METHODS

Data Sources and Search Strategies

The following databases were searched for candidate articles: Medline (1990 to 2005), electronic abstracts from the annual meetings of the Society for Pediatric Research (1998 to 2005), Econlit (1990 to 2005), and the Proquest dissertation and theses full-text index (1990 to 2005). The Science citation index was searched for articles citing any of the first authors of included studies. The bibliographies of other systematic or informal reviews were scanned (1–7). The websites of organizations known to be involved in similar research were also scanned; these included the websites of the March of Dimes, the Alan Guttmacher Institute, and the Centers for Disease Control and Prevention. The search strategies were intentionally broad to ensure optimal sensitivity. The intersection of the exploded MeSH headings “infant, newborn” and “costs and cost analysis” was used for Medline searches. For other databases, the keywords “econom*” OR “cost*” AND “infant” were used. The titles and abstracts of the articles retrieved with these strategies were manually screened to determine whether they met the inclusion criteria described above.

Cost Projections

Cost estimates were inflated to 2005 constant dollars by using both the medical component of the consumer price index (8) and the hospital producer price index (9). Currencies were converted to U.S. dollars by using purchasing power parities (10). Per-patient estimates of cost were projected to the U.S. birth cohort by multiplying by the number of infants in a given gestational age or birth weight category, according to the 2002 natality file of the National Center for Vital Statistics (11). State-level population cost estimates were projected to the U.S. birth cohort by dividing by the ratio of the state’s birth cohort to the total number of births nationally for 2002 (the most recent year for which such statistics were available).

YIELD OF SEARCH STRATEGY

The manual screening of titles and abstracts from the initial literature searches yielded 170 articles. Of these, the majority were eliminated because they were review articles or economic evaluations of interventional studies, were based on data from middle-income or developing countries, were studies at the neonatal intensive care unit level not stratified by birth weight or gestational age, or had cohort dates prior to 1990 for short-run cost reports or 1980 for long-run cost reports. Descriptions and methodological assessment of the short-run (12–27) and the long-run (15, 27–41) cost studies retrieved are shown in Tables D-1 and D-2, respectively.

Table

TABLE D-1A Studies of Costs During Initial Hospitalization.

Table

TABLE D-2A Studies of Costs Following Discharge from Initial Hospitalization.

METHODOLOGICAL LIMITATIONS OF STUDIES RETRIEVED

Studies of Costs Following Discharge from the Initial Hospitalization

The longer-run costing studies were similarly methodologically variable. Several of these limitations overlapped with those of the short-run studies.

Most of the studies were secondary analyses of data collected for other purposes. One study was a randomized trial with prospective data collection (28), six used linked governmental vital statistics and administrative or survey databases (27, 29, 31, 33, 34, 38), four used commercial or governmental claims databases (15, 36, 37, 41), three used clinical data (35, 39, 40), and two collected primary data through patient interviews (27, 30, 32). For preexisting data sets, validation was generally not described.

The majority of long-run studies were from broadly representative cohorts. These geographically based cohorts were at the regional (27, 33–35, 39, 40), state (36, 38), and national (29, 31) levels. Only six smaller studies used convenience or hospital-specific samples (15, 28, 30, 32, 37, 41).

There were, however, other problems with generalizability. Six of the 16 long-run studies were from countries other than the United States (27, 33–35, 39, 40). Of note, these were all geographical cohorts and represented the only studies in the review with assessment of direct medical costs beyond 2 years of age. Generalizability was also compromised by the broad time range of the studies. As noted above, the literature search was restricted only to studies conducted after 1980, given that postdischarge care is not as technologically sophisticated and therefore not as rapidly changing. This decision also allowed the inclusion of longer periods of follow-up. The cohort dates of these studies, however, ranged from 1980 to 2001; and the degree of comparability or applicability of earlier studies to the current context is unclear. Most studies did specify the birth weight and gestational age inclusion criteria for the samples, which allowed projection of the results for health policy. Studies that relied on claims databases used DRG designations, which must be applied with a degree of discretion, thus limiting external validity (15, 41).

In contrast to the studies of initial neonatal hospitalization, the sample sizes of most of these studies were adequate, possibly because of the greater reliance on administrative data. Four of the 16 studies had sample sizes of >20,000 infants (15, 31, 33, 34). Although these were heavily weighted toward full-term controls, the sizes of the subsamples of infants born preterm still comprised several hundred to several thousand infants. Only five studies had sample sizes of <150 infants (27, 30, 32, 35, 40). Although the confidence intervals around the cost estimates are consequently broad, most of these studies involved direct patient interviews or questionnaires and yielded unique information that would otherwise not have been obtainable.

Ten of the studies stated that they used costs derived from cost-to-charge ratios or other cost-accounting systems. None of the authors conducted primary costing research, and direct validation of preexisting cost-accounting systems was not presented; however, in at least some of the studies, these appear to be well-established and accepted systems (33, 34). The validity of patient-reported costs is equally difficult to ascertain. None of the studies presenting data from patient interviews, diaries, or questionnaires provided validation of these sources (27, 30, 32).

Uncertainty was again assessed inconsistently. Seven of the studies presented no information on sampling or parameter uncertainty, either through descriptive statistics or sensitivity analysis (15, 31, 35, 36, 39–41).

The assessment of costs for premature infants over the longer term is a more complex exercise, requiring the assembly of data from multiple sources. In some studies, this led to a large number of assumptions regarding the applicability of data, the choice of unit costs, and natural history (29, 31). Although these assumptions were well explained, it is very difficult to know the extent to which they are valid.

Unlike the assessment of initial hospital costs, the study of postdischarge resource utilization ideally tracks costs over several years. Most individuals have a positive rate of time preference; that is, they prefer to receive benefits sooner rather than later and to defer negative factors such as costs. To take account of this preference, economists apply a discount rate to reduce the weight of future investments in a stream of costs over time. This is variably set at 0 to 5 percent, with a 3 percent rate generally being considered reasonable for application in the base case. Only 5 of the 16 studies in the present review applied a discount rate (28, 29, 35, 39, 40).

CONTENT LIMITATIONS OF RETRIEVED STUDIES

Studies of Costs Following Discharge from the Birth Hospitalization

CHARACTERIZATION AND ESTIMATES OF COSTS OF INITIAL HOSPITALIZATION

Direct Medical Costs

Despite the heterogeneity of methods, designs, and sources, estimates of the per-patient cost are moderately consistent. The second column of Table D-3 shows the per-patient costs derived from the studies, expressed in 2005 U.S. dollars. For infants with birth weights of 500 to 999 grams, cost estimates ranged from $67,027 to $221,450, with four of six estimates in the range $84,847 to $126,380 per infant.

TABLE D-3

Direct Medical Costs During Initial Hospitalization.

There are several potential sources of variability in cost estimates. First, the studies were performed with cohorts spanning a 15-year period. The characteristics of the adjusters for differences over time are therefore significant. The results are reported with both the medical component of the consumer price index (CPI), which relies on charges and may therefore overestimate charges, and the hospital producer price index (PPI), which used the actual net costs of resources, purchased by both public and private sources. As shown in Table D-3, use of these indices had a minimal effect on the results, suggesting that the source of variation lies elsewhere. A second potential source of variability in estimates is in the geographic diversity of the cohorts. International comparisons are facilitated to some extent by the Organisation for Economic Co-operation and Development purchasing power parity, although this accounts only for differences in price and not differences in practice style. Within the United States, neonatal care is fairly homogeneous, so it is likely that price differences will outweigh geographic practice style differences. An adjustment for geographic differences was not made because of the difficulty in defining the location of care for most of the cohorts, which were often either at the state level or at institutions in several states. Finally, variability arises because of the authors’ choices of which types of costs to include. Unfortunately, most authors did not disaggregate costs into components, thus making an assessment of the contributions of these choices to the cost estimates difficult to quantify. Table D-3 presents neonatal costs separately from maternal costs, showing a greater degree of variability for the former.

Because it is difficult to fully address variability in prices, an attempt was also made to describe resource utilization independent of its price. Table D-3 shows the length of stay (LOS) and the number of days of assisted ventilation for the studies reviewed. Although not all studies reported these measures, the variability in the direct markers of resource utilization appears to be somewhat less than that for cost. The LOSs for infants with birth weights of 500 to 999 grams ranged from 64 to 106 days in six studies, with four studies showing LOSs in the narrow range of 73 to 82 days.

Studies that reported both birth weight- and gestational age–specific costs show that these are consistent. Gilbert et al. give a per-patient cost of $202,700 for a survivor born at 25 weeks gestation and a per-patient cost of $224,400 for a survivor born with a birth weight of 500 to 750 grams (18). For survivors born at 30 weeks gestation, the per-patient cost is $46,400, whereas for a survivor with a birth weight of 1,250 to 1,499 grams, the per-patient cost is $51,900. These authors excluded infants whose birth weights and gestational ages did not match; the birth weight-specific costs may therefore be less biased, as the gestational age on vital statistics records is more often likely to be inaccurate. Across all studies, under the assumption that DRG Code 387 for extreme prematurity corresponds to gestational ages of <28 weeks, costs ranged from $70,451 to $100,389, similar to those for the corresponding birth weight range of 500 to 999 grams.

When the costs were projected to the U.S. population, the range for infants born at <37 weeks gestation was $4.62 billion to $13.38 billion, with the latter estimate derived from a study based on charges (15). For infants with birth weights of 500 to 999 grams, the costs ranged from $1.53 billion to $5.06 billion, with the range for the U.S. population being $2.72 billion to $5.06 billion.

Full-term controls had per-patient costs of $734 to $4,303. If the stud ies that used charges or failed to specify this were excluded, the range for the U.S. population was $1,545 to $1,900. Corresponding population projections were $2.37 billion to $6.58 billion.

The previously noted inverse relationship between costs and gestational age or birth weight was observed in all studies. The marked right skew of the cost data was also noted in those studies that reported means and medians (23–25, 27).

Direct Nonmedical Costs and Lost Productivity

Table D-4 describes studies that assessed parental out-of-pocket expenditures and lost productivity. In the single study that examined both non-medical direct costs and productivity losses, parental mean costs before discharge for extremely low birth weight infant were €2,755, or 4 percent of total costs (27). These were composed of 64 percent travel costs, 30 percent lost earnings, and 6 percent accommodation. An earlier interview study of travel costs for mothers of 109 low-birth-weight infants in Britain showed that 36 percent of families traveled more than 21 miles, that 88 percent of families visited the infants daily, and that the median total expenditure was between £101 and £200 (in 1990 United Kingdom pounds sterling), with a maximal expenditure of £1,000 (22). More recently, Gennaro observed the families of 224 infants born at less than 37 weeks of gestational age discharged from a single center between 1990 and 1994 (30). That study did not detail the productivity losses during the initial hospitalization. The average mother in that study used 4 weeks of maternity leave during the initial hospitalization. Out-of-pocket expenses averaged $433, with the largest category being transportation.

Table

TABLE D-4 Parental Out of Pocket Expenses and Lost Productivity During Initial Hospitalization.

CHARACTERIZATION AND ESTIMATES OF COSTS FOLLOWING DISCHARGE FROM THE BIRTH HOSPITALIZATION

Direct Medical Costs

Estimates of direct medical resource utilization and costs following discharge from the birth hospitalization are given in Table D-5. There was a greater degree of heterogeneity compared with that in the studies of initial hospitalization, in large degree because of the various time horizons and costs included. For this reason, it is problematic to provide a single estimate or range of estimates for these costs. As for short-run costs, costs and resource utilization were inversely related to gestational age. In addition, in studies with longer follow-ups, the majority of the costs accrued in the first year of life. In studies that measured both outpatient and rehospitalization costs, the latter accounted for the majority of costs in the first year of life, with a range of 54 to 60 percent of the costs in the non-U.S. studies and 70 to 86 percent of the costs in the U.S. cohorts.

TABLE D-5

Direct Medical Expenses Following Discharge from the Initial Hospitalization.

Petrou examined factors associated with higher rehospitalization costs (33). These included maternal conditions, such as hospitalization, age >35 or <20 years, or smoking; perinatal factors, such as instrumental delivery or delivery complications; demographic factors, such as lower socioeconomic status; and prematurity.

Educational Costs

Details of studies assessing educational costs are given in Table D-6. As noted above, the assessment of educational costs was inconsistent with respect to both the study methodology and the age at the time of the assessment. After controlling for medical, economic, and social factors, Chaikind and Corman found a 49 percent relative risk for special education placement in low-birth-weight infants (29). This translated to a net present value of $1,240 (in 1988 U.S. dollars) per low birth weight infant, or $370 million per year for special education costs alone. Roth et al. found that infants with birth weights of <1,000 grams had kindergarten costs 60 percent higher than those for normal birth weight controls (38). However, the authors noted that low levels of maternal education and poverty accounted for more than three quarters of the total excess costs of kindergarten, whereas low birth weight accounted for only 1 percent of the total excess costs because of the relative numbers of children with these predisposing conditions.

Table

TABLE D-6 Educational Expenditures Following Discharge from Initial Hospitalization.

Early intervention costs may also be significant. A recent study of statelevel data in Massachusetts assessed costs from birth to age 3 years for early intervention services by gestational age. Infants born at less than 28 weeks of gestation had early intervention costs of $7,182 (in 2003 U.S. dollars), whereas the early intervention costs were $613 for those delivered at 40 weeks of gestation or more (53).

Direct Nonmedical Costs and Lost Productivity

Table D-7 shows the costs associated with postdischarge parental out-of-pocket expenses and lost productivity. Tommiska et al. documented firstyear parental wage losses of €5,990 for infants with birth weights of <1,000 grams, whereas the loss was €880 for controls. These costs increased to €8,175 in the second year for the parents of children born with low birth weights (27). Similar data are not available for the United States.

Table

TABLE D-7 Out-of-Pocket Expenses and Lost Productivity Following Discharge from Initial Hospitalization.

SUMMARY OF COST STUDIES FOR PREMATURITY

Several themes emerged from this systematic review of cost-of-illness studies:

1. Most studies had significant methodological limitations. These included a reliance on administrative data sets without adequate checks on data validity, small sample sizes and possible selection bias, a lack of quantification of uncertainty through the use of descriptive statistics or sensitivity analysis, the use of charges or inadequately described costing, the lack of a control group, and a failure to discount appropriately for longer studies.
2. All cost estimates in the literature omitted at least some potentially important components of costs and are therefore likely to underestimate true resource use. These omissions included professional fees, hospital costs for transferred infants, costs for nonsurviving infants, and out-of-pocket costs for parents. There is almost no information on the lost earnings of parents and no information on the productivity losses of the infants themselves. Maternal costs for the delivery hospitalization and the costs of antenatal admissions were omitted by most studies. The analysis of infants and mothers separately risks both an underestimation of the costs of prematurity and the possibility of missed shifting of costs between the two groups. Very few studies have addressed educational costs, and these do not provide adequate information across the spectrum of school age and disability.
3. Most authors did not disaggregate costs into their components, making it problematic to target the sources and predictors of high costs.
4. Studies confirmed the previously noted inverse relationship of maternal, neonatal, and postdischarge costs with birth weight and gestational age.
5. Although the per-patient cost for moderately preterm infants is lower than that for extremely preterm infants, the larger numbers of these infants results in population costs of similar magnitudes in both groups. This has important implications for the setting of policy, as interventions that ameliorate moderate prematurity may be as cost-effective as the more difficult interventions that would eliminate extreme prematurity.
6. The time horizon for economic follow-up is inadequate. Very few studies have followed infants beyond 5 years, and none have documented the implications of prematurity in young adulthood, despite the availability of appropriate cohorts.
7. Most of the studies with longer time horizons or more comprehensive methods of cost ascertainment have been from countries other than the United States. The appropriateness of generalizing these cost estimates to the United States is uncertain.

RECOMMENDATIONS FOR POLICY AND FURTHER RESEARCH

The findings summarized above have direct implications for policy and research:

1. Because policy makers are likely to accept the dollar estimates of the costs of illness without adequately assessing the quality of the underlying studies, it is important that the peer review process identify the more significant methodological limitations, such as the use of unadjusted charges or the lack of assessment of uncertainty.
2. In light of the prominence of the economic implications on health policy decision making for this population, it is essential that a U.S. study with a societal perspective be performed. This should include a comprehensive assessment of productivity losses and parental out-of-pocket expenditures in the U.S. context.
3. Studies with longer time horizons should be undertaken and should preferably use an incidence approach rather than a prevalence approach to costing. At a minimum, these should extend well into school age. The implications of prematurity as young adults enter the work force should be examined, as should lifetime labor force implications.
4. Because of the interactions between socioeconomic status and outcome, costing studies should include specific analyses of the increased burden on particular racial and ethnic populations.
5. The focus of short-run costing studies should be shifted toward a perinatal perspective, in which the unit of analysis is the maternal-infant dyad. This is now feasible with improved data linkage.
6. Attention should be directed toward the economic implications of moderate prematurity, in addition to extreme prematurity.
7. A longitudinal analysis of the economic implications of prematurity to the educational system should be undertaken.
8. A comprehensive longitudinal study of the long-term economic implications of prematurity should be undertaken.

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Footnotes

1

John A. F. Zupancic MD, ScD, Department of Pediatrics, Harvard Medical School, Boston, Massachusetts.