Objective. - To quantify the trade-off between the expected increased short- and long-term costs and the expected increase in quality-adjusted life expectancy (QALE) associated with total hip arthroplasty (THA) for persons with functionally significant hip osteoarthritis. Design. - A cost- effectiveness study was performed from the societal perspective by constructing stochastic tree, decision analytic models designed to estimate lifetime functional outcomes and costs of THA and nonoperative managements. Main Outcome Measures. - A modified four-state American College of Rheumatology functional status classification was used to measure effectiveness. These functional classes were assigned utility values to allow the relative effectiveness of THA to be expressed in quality-adjusted life years (QALYs). Lifetime costs included costs associated with primary and potential revision surgeries and long-term care costs associated with the functionally dependent class. Data Used in the Coat-effectiveness Model. - Probability and incidence rate data were summarized from the literature. The THA hospital cost data were obtained from local teaching hospitals' cost accounting systems. Estimates of recurring medical costs for functionally significant hip osteoarthritis and for custodial care were derived from the literature. Results. - The THA cost-effectiveness ratio increases with age and is higher for men than for women. In the base-case scenario for 60-year- old white women who have functionally significant but not dependent hip osteoarthritis, the model predicts that THA is cost saving because of the high costs of custodial care associated with dependency due to worsening hip osteoarthritis and that the procedure increases QALE by about 6.9 years. In the base-case scenario for men aged 85 years and older, the average lifetime cost associated with THA is $9100 more than nonoperative management, with an average increase in QALE of about 2 years. Thus, the THA cost-effectiveness ratio for men aged 85 years and older is $4600 per QALY gained, less than that of procedures intended to extend life such as coronary artery bypass surgery or renal dialysis. Worst-case analysis suggests that THA remains minimally cost-effective for this oldest age category ($80 000/QALY) even if probabilities, rates, utilities, costs, and the discount rate are simultaneously varied to extreme values that bias the analysis against surgery. Conclusions. - For persons with hip osteoarthritis associated with significant functional limitation, THA can be cost saving or, at worst, cost- effective in improving QALE when both short- and long-term outcomes are considered. Further research is needed to determine whether this procedure is actually being used in this cost-effective manner, especially in older age categories.
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