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. Author manuscript; available in PMC: 2026 Feb 28.
Published in final edited form as: J Pediatr. 2022 Dec 5;256:11–17.e2. doi: 10.1016/j.jpeds.2022.11.032

Cost-Effectiveness of Management Strategies in Recurrent Acute Otitis Media

Kathleen A Noorbakhsh 1, Hui Liu 1, Marcia Kurs-Lasky 1, Kenneth J Smith 2, Alejandro Hoberman 1, Nader Shaikh 1
PMCID: PMC12947165  NIHMSID: NIHMS2142851  PMID: 36470464

Abstract

Objective

To evaluate the cost-effectiveness of tympanostomy tube placement vs nonsurgical medical management, with the option of tympanostomy tube placement in the event of treatment failure, in children with recurrent acute otitis media (AOM).

Study design

A Markov decision model compared management strategies in children ages 6-35 months, using patient-level data from a recently completed, multicenter, randomized clinical trial of tympanostomy tube placement vs medical management. The model ran over a 2-year time horizon using a societal perspective. Probabilities, including risk of AOM symptoms, were derived from prospectively collected patient diaries. Costs and quality-of-life measures were derived from the literature. We performed one-way and probabilistic sensitivity analyses, and secondary analyses in predetermined low- and high-risk subgroups. The primary outcome was incremental cost per quality-adjusted life-year gained.

Results

Tympanostomy tubes cost $989 more per child than medical management. Children managed with tympanostomy tubes gained 0.69 more quality-adjusted life-days than children managed medically, corresponding to $520 855 per quality-adjusted life-year gained. Results were sensitive to the costs of oral antibiotics, missed work, special childcare, the societal cost of antibiotic resistance, and the quality of life associated with AOM. In probabilistic sensitivity analyses, medical management was favored in 66% of model iterations at a willingness-to-pay threshold of $100 000/quality-adjusted life-year. Medical management was preferred in secondary analyses of low- and high-risk subgroups.

Conclusions

For young children with recurrent AOM, the additional cost associated with tympanostomy tube placement outweighs the small improvement in quality of life. Medical management for these children is an economically reasonable strategy.

Trial registration

ClinicalTrials.gov number, NCT02567825.


Acute otitis media (AOM) is the most common pediatric infection for which antibiotics are prescribed in the US.1 Recurrent AOM, defined as 3 or more episodes of AOM in a 6 month period or 4 in a 12 month period, is associated with considerable economic burden and decreased quality of life.25 There was no difference in the yearly rate of episodes of AOM over a 2-year period among children with recurrent AOM who were randomized to surgical intervention with placement of tympanostomy tubes or to nonsurgical medical management with tympanostomy tube placement in the event of treatment failure.6 An aim of that study was to collect detailed data during the 2-year follow-up period that would allow a comparison of the costs and associated quality of life for each of the management strategies.

In this investigation, we use decision modeling techniques to evaluate the cost-effectiveness of tympanostomy tube placement and medical management of recurrent AOM in young children using data collected in the above-mentioned trial. In a secondary analysis, we investigated the cost-effectiveness of each strategy in high- or low-risk subgroups.

Methods

Study Design

We created a decision-analytic Markov model to simulate a hypothetical cohort of children 6-35 months of age with a history of recurrent AOM. We collected data prospectively as part of the randomized clinical trial, Efficacy of Tympanostomy-tubes for Children With Recurrent AOM (ClinicalTrials.gov number, NCT02567825).7 The protocol, which included the design for the cost-effectiveness analysis conducted here, was approved by the participating institutional review boards at University of Pittsburgh Medical Center Children’s Hospital of Pittsburgh; Children’s National Medical Center in Washington, D.C.; and Kentucky Pediatric and Adult Research in Bardstown, Kentucky. The decision model was programmed in TreeAge Pro 2016 (TreeAge Software, Inc).

We used intention-to-treat data for our primary analysis. Using these data, we constructed a hypothetical cohort of 1000 children and followed them over a 2-year period. We chose a 2-year time horizon because the trial followed enrolled children for 2 years and collected detailed data on costs and resource utilization. Per the trial protocol, parents used an electronic diary to record, on a daily basis, their child’s symptoms and any instance of adverse drug events. Use of medical and nonmedical resources was recorded during the trial.7

We considered the following health states: (1) well, (2) symptomatic with AOM, (3) symptomatic with otorrhea, or (4) hospitalized. Children in the simulated population were initially categorized as well and assigned to either tympanostomy tube placement or medical management with tympanostomy tubes placed in the event of treatment failure. Children who underwent tympanostomy tube placement did so at the start of the model. Over time, children in each strategy experienced episodes of AOM or otorrhea, underwent medical evaluations, received antibiotic treatment and additional medical procedures, and their caregivers missed work or required special childcare secondary to their children’s illnesses. Frequency of these events was drawn from trial data described above. To calculate days with AOM or otorrhea, we used patient diaries that were prospectively collected whenever patients were feeling unwell during the 2-year follow-up period. Days with AOM symptoms were defined by the presence of any symptom of AOM in a child with otoscopically confirmed AOM (ie, a score of ≥1 on the acute otitis media severity of symptom scale, version 4.0, for that day). Otorrhea and antibiotic use were also recorded daily on the electronic diary. Accordingly, quality-adjusted life days (QALDs) were calculated for each child included in the study using data provided prospectively by parents in daily diaries.

Model Inputs

Input measures for probabilities, costs, and outcomes are presented in Tables I and II. For variables based on clinical trial data and for variables drawn from the literature, we included a 95% probability range. For cost variables or variables for which a probability range was not reported, a probability range was estimated.

Table I.

Costs and utilities

Variable Point value Range
Costs ($)
 Hour of work8 29 15-45
 Primary care office visit912 157 36-307
 Urgent care visit9,13 270 250-511
 Otolaryngology office visit11,12 279 200-400
 Emergency department visit9,14 520 385-555
 Tympanostomy-tube placement procedure12,15 739 700-2065
 Adenectomy16,17 1151 480-1822
 Tonsillectomy1618 1222 480-2385
 Adenotonsillectomy16,17 1355 1029-2385
 Ear wick19 7 5-9
 Hospitalization9,20 1630 1205-13 236
 Ibuprofen oral suspension, per mL21 0.04 0.03-0.08
 Nystatin topical cream, per gm21 0.42 0.35-0.80
 Ofloxacin 0.3% otic suspension, per mL21 17 14-20
 Amoxicillin-clavulanate oral suspension, per mL21 0.20 0.06-0.51
 Societal cost of antibiotic resistance, per prescription22 14 3-95
Utilities
 Acute otitis media10 0.79 0-100
 Otorrhea 0.90 0-100
 Diarrhea10 0.88 0-100
 Diaper dermatitis10 0.99
 Hospitalization23 0.88 0-100
Other
 Hours in a workday 8 6-12
 Cycle length 1 day

Table II.

Clinical parameters used in the base case model

Variable Medical management
Tympanostomy-tubes
Point value 95% CI Point value 95% CI
Proportion of children undergoing tympanostomy-tube placement 0.45 0.36, 0.53 0.90 0.85, 0.95
Proportion of children undergoing second tympanostomy-tube placement 0.02 0.00, 0.05 0.09 0.04, 0.15
Days per child per y
 Otorrhea 2.83 1.28, 4.37 7.96 5.79, 10.14
 AOM-SOS ≥1 8.33 7.17, 9.49 2.00 1.44, 2.57
 Protocol-defined diarrhea* 0.79 0.48, 1.10 0.60 0.22, 0.97
 Diaper dermatitis 1.55 0.94, 2.16 0.99 0.48, 1.49
 Systemic antibiotics 12.92 11.13, 14.71 8.76 6.89, 10.63
 Otic antibiotic drops 6.92 4.37, 9.48 19.43 15.61, 23.26
 Oral analgesics 1.27 0.83, 1.71 0.90 0.44, 1.35
 Antifungal cream 1.37 0.88, 1.85 0.96 0.46, 1.47
 Hospitalization 0.01 0.00, 0.03 0.00 0.00, 0.01
Outpatient medical encounters per child per y
 Primary care physician 2.13 1.92, 2.35 2.06 1.83, 2.28
 Urgent care 0.34 0.24, 0.44 0.36 0.27, 0.44
 Emergency department 0.44 0.32, 0.57 0.54 0.39, 0.69
 Otolaryngology (excluding postoperative follow-up) 0.24 0.16, 0.32 0.34 0.24, 0.43
Days missed work for illness per child per y 2.73 2.04, 3.42 2.71 2.18, 3.24
Days special childcare for illness per child per y 2.56 1.84, 3.27 3.16 2.38, 3.94
Additional otolaryngology procedures per study period
 Adenoidectomy 1  0, 2 7  5, 9 
 Tonsillectomy 0  0, 1 1  0, 2 
 Adenotonsillectomy 1  0, 2 1  0, 2 
 Wick placement 2  1, 3 3  2, 4 

AOM-SOS, acute otitis media severity of symptom scale.

*

Protocol-defined diarrhea was the occurrence of at least 3 watery stools on 1 day or at least 2 watery stools on 2 consecutive days.

Diaper dermatitis was defined as dermatitis resulting in topical antifungal treatment.

Costs included direct costs of medical evaluations, diagnostic testing, and medical treatment. We based costs of outpatient medical evaluations and procedures on prior publications,919 and costs of hospitalization on prior publications and median value for pediatric hospitalizations, as reported by the Health care Cost and Utilization Project.9,20 We based medication costs on the National Average Drug Acquisition Cost, as reported by the Centers for Medicare & Medicaid Services.21 Each prescription for systemic antibiotics was assigned an additional cost to account for the societal cost of antibiotic resistance associated with antibiotic use in the US22 Costs of missed work and special childcare were based on average hourly wages from the US Bureau of Labor Statistics.8 We adjusted costs to 2020 US dollars based on the medical cost component of the Consumer Price Index,24 and selected 2020 as this was the last year of clinical trial data collection.

Health state utility values were drawn from the literature and QALDs were calculated as the duration in health states multiplied by the utility of that state.10,23 We used an estimate of quality-of-life utility for otorrhea of 0.9, as no data were available in the literature. Costs and utilities were not discounted given the 2-year time horizon.

Cost-effectiveness Analysis

We conducted our cost-effectiveness analysis from a societal perspective, considering health expenditure costs as well as missed work and additional child care.25 Primary outcomes we evaluated included cost, effectiveness (days without symptoms of AOM), and cost-effectiveness. We ranked strategies by cost then compared them in terms of cost, effectiveness, and incremental cost-effectiveness ratio (ICER). We assumed a willingness-to-pay of $100 000/quality-adjusted life-year (QALY) gained a commonly cited threshold for the US health care system.25

Subgroup Analysis

To determine whether the cost-effectiveness of tympanostomy tubes may be different for children at higher risk of recurrent AOM, we conducted a secondary analysis focusing on high- and low-risk cohorts. We determined risk level a priori using a 16-point scale that assessed age of onset of AOM and quantity and severity of prior infections. We defined high-risk for recurrent AOM as a score ≥8. This scale is described in detail in the final version of the protocol.6

Sensitivity Analyses

We conducted one-way sensitivity analyses to determine if varying any individual measure across its listed range substantially changed results. Threshold analyses were performed to determine the point at which changes to certain input measures resulted in a substantial change in the preferred strategy. We then performed probabilistic sensitivity analyses in which all measures could vary simultaneously; we ran these models 1000 times and report findings as a cost-effectiveness acceptability curve,26 which shows the likelihood that strategies would be favored over a range of cost-effectiveness willingness-to-pay (or acceptability) thresholds from $0 to $200 000/QALY gained. For the probabilistic sensitivity analysis, we randomly chose values for each measure from the provided distributions. We used β distributions for probabilities and quality adjustments and γ distributions for costs.

Results

In the primary analysis, medical management was the less expensive strategy (cost approximately $1000 less than tympanostomy tube placement over the 2-year period). The tympanostomytube placement strategy was more effective; children undergoing surgery had a gain of approximately 0.69 days of perfect health over 2 years. Accordingly, compared with the medical management strategy, the tympanostomy tube placement strategy cost an additional $1427/QALD gained (Table III and Table IV; available at www.jpeds.com). This approximates to $520 855 per QALY, which exceeds the commonly cited $100 000/QALY willingness-to-pay threshold for the US health care system.

Table III.

Cost-effectiveness analysis

Strategy Cost ($) Incremental cost ($) Effectiveness (QALDs) Incremental effectiveness (QALDs gained) ICER ($/QALD) ICER ($/QALY)
Primary analysis
 Medical management 4497 - 725.07 - - -
 Tympanostomy-tubes 5486 989 725.76 0.69 1427 520 855
High risk cohort
 Medical management 4455 - 725.21 - - -
 Tympanostomy-tubes 6008 1553 725.38 0.17 9065 3 308 725
Low risk cohort
 Medical management 4433 - 724.99 - - -
 Tympanostomy-tubes 4782 349 726.20 1.21 287 104 755

Table IV.

Breakdown of costs and utilities per person by strategy over 2 years, base-case analysis

Variable Medical management Tympanostomy-tubes
Costs per person over 2 y ($)
 Tympanostomy tube placement 342 729
 Otic antibiotic drops 117 330
 Systemic antibiotics 41 28
 Societal cost of antibiotic resistance 37 25
 Primary care office visits 668 668
 Emergency department visits 457 509
 Urgent care visits 183 176
 Otolaryngology office visits 134 196
 Hospitalizations 40 13
 Special childcare 1188 1466
 Missed work 1266 1258
 Additional otolaryngologic surgery 20 88
 Ear wick <1 <1
 Ibuprofen 1 1
 Nystatin topical cream 2 2
 TOTAL 4497 5486
  Additional cost 989
QALDs lost over 2 y
 AOM symptoms 4.14 2.47
 Otorrhea 0.56 1.59
 Protocol-defined diarrhea 0.19 0.16
 Diaper dermatitis 0.03 0.02
 Hospitalization 0.006 0.002
 TOTAL lost 4.93 4.24
QALDs experienced over 2 y*
 Total QALD 725.07 725.76
 Additional QALDs 0.69
ICER (Cost/QALD) $1427
ICER (Cost/QALY) $520 855

Bold text indicates the additional cost or QALDs accrued with the tympanostomy-tubes strategy compared to medical management.

*

Calculated by subtracting total QALDs lost over the 2 years from the maximum possible QALD (ie, 730).

One-way sensitivity analyses demonstrated that the model was sensitive to the cost of oral antibiotics, the societal cost of antibiotic resistance, the quality of life associated with AOM, and the duration of missed work and special childcare associated with each strategy (Table V). The results of the probabilistic sensitivity analysis were consistent with the findings from the primary analysis; medical management was the preferred strategy at all willingness to pay thresholds from $0 to 200 000/QALY. At a willingness-to-pay threshold of $100 000/QALY, the medical management strategy was preferred in 66% of model iterations (Figure).

Table V.

One-way sensitivity analysis

Variable Base-case value Threshold value Preferred strategy
Below threshold Above threshold
Cost of oral antibiotics, per d  1.60 97.90 Medical management Tympanostomy-tubes
Societal cost of antibiotic resistance, per prescription 14.45 97.74 Medical management Tympanostomy-tubes
Utility of acute otitis media  0.79  0.42 Tympanostomy-tubes Medical management
D of special child care per y
 Medical management  2.56  4.28 Medical management Tympanostomy-tubes
 Tympanostomy-tubes  3.16  1.44 Tympanostomy-tubes Medical management
D of missed work per y
 Medical management  2.73  4.45 Medical management Tympanostomy-tubes
 Tympanostomy-tubes  2.71  0.99 Tympanostomy-tubes Medical management

Figure.

Figure.

Probabilistic sensitivity analysis. Results are shown as cost-effectiveness acceptability curves, depicting cumulative probability (y-axis) that the cost-effectiveness of a strategy will be less than or equal to a given willingness-to-pay threshold (x-axis).

Subgroup Analyses

In the subgroup analysis, medical management was the preferred strategy for individuals at high-risk of recurrent AOM. Tympanostomy tube placement cost an additional $1553 for an additional 0.17 QALDs per patient over 2 years, resulting in an ICER of $9065 per QALD gained. The ICER in terms of cost per QALY gained exceeded the $100 000 per QALY gained willingness-to-pay threshold (Table III). One-way sensitivity analyses demonstrated that this model was sensitive to parental missed work and special childcare required (Table VI; available at www.jpeds.com). Probabilistic sensitivity analyses demonstrated that at a willingness-to-pay threshold of $100 000/QALY, medical management was the preferred strategy for patients in the high-risk cohort in 76% of model iterations.

Table VI.

Subgroup one-way sensitivity analyses

Variable Base-case value Threshold value Preferred strategy
Below threshold Above threshold
High-risk cohort
 D of missed work per y
  Medical management 2.84 6.20 Medical management Tympanostomy-tubes
 D of special childcare per y
  Medical management 2.62 6.09 Medical management Tympanostomy-tubes
  Tympanostomy-tubes 3.59 0.01 Tympanostomy-tubes Medical management
Low-risk cohort
 Cost of oral antibiotics, per d 1.60 2.98 Medical management Tympanostomy-tubes
 Societal cost of antibiotic resistance, per prescription 1.45 2.82
 Cost of otic antibiotics per d 8.5 7.7 Tympanostomy-tubes Medical management
 Cost of tympanostomy procedure 739 706 Tympanostomy-tubes Medical management
 Cost of emergency department visit 520 452
 Cost of urgent care visit 270 373
 Utility of acute otitis media 0.79 0.78 Tympanostomy-tubes Medical management
 Utility of otorrhea 0.90 0.91 Medical management Tympanostomy-tubes
 Utility of diaper dermatitis 0.99 0.96
 Utility of diarrhea 0.88 0.81
 D of missed work per y
  Medical management 2.66 2.70 Medical management Tympanostomy-tubes
  Tympanostomy-tubes 2.09 2.05 Tympanostomy-tubes Medical management
 D of special childcare per y
  Medical management 2.52 2.56 Medical management Tympanostomy-tubes
  Tympanostomy-tubes 2.53 2.49 Tympanostomy-tubes Medical management

In the low-risk cohort, tympanostomy tube placement cost an additional $349 per patient with 1.2 additional QALDs over 2 years, yielding an ICER of $287/QALD gained. One-way sensitivity analyses demonstrated that this model was sensitive to the costs of oral and otic antibiotics, tympanostomy tube placement, missed work, and special childcare; and the quality of life associated with both AOM and otorrhea (Table VI). The ICER exceeded the $100 000 per QALY gained willingness-to-pay threshold. For the low-risk cohort, medical management was the preferred strategy in 51% of model iterations.

Discussion

We performed a cost-effectiveness analysis to compare tympanostomy tube placement and medical management in children with recurrent AOM and found that medical management provided economically reasonable outcomes compared with tympanostomy tube placement. Medical management was the preferred strategy in both high- and low-risk subgroups. The main determinants of these results were the higher cost for tympanostomy tube placement, childcare, and otic antimicrobial agents in the tympanostomy tube group which were not accompanied by a similar increase in each child’s quality of life.

We found that model results were robust. Although results were sensitive to the cost of oral antibiotics, the utility of AOM, and the duration of missed work and special childcare, in every case, the threshold values needed for surgical management to become the favored strategy was far from the base case values, which, in almost all cases, were derived directly from the trial data or from the literature.

We included the societal cost of antimicrobial resistance in this model. Studies examining community antimicrobial resistance suggest that antibiotic prescriptions may contribute to the development of antibiotic resistant pathogens.27 The true cost of resistance on an individual prescription basis is difficult to assess. Our selection of $14 per prescription was based on the literature and assigned on a per prescription basis.22 There were more antibiotic prescriptions in the medical management strategy. Thus, the model included a higher burden of societal cost of antibiotic resistance for this strategy. In the trial from which data for this study were drawn, there were no significant between-group differences in the percentage of children with nasopharyngeal colonization with any penicillin-nonsusceptible pathogen. Moreover, conditional odds ratios, measuring community-wide effects antibiotic treatment on antibiotic resistance, did not differ between the treatment groups, suggesting that societal impact of antibiotic prescriptions was not significantly different between the 2 treatment arms.28 In our model, one-way sensitivity analyses demonstrated that the societal cost of antibiotic resistance would need to be greater than $97 per prescription in order for the tympanostomy tubes management strategy to be preferred. Given the trial findings of no between-group differences in measures of the effect of antibiotic prescriptions on antimicrobial resistance, it is likely that the assignment of societal cost of antibiotic resistance by antibiotic prescription biased the model against the medical management strategy. Topical antibiotics also contribute to community antibiotic resistance, although likely on a smaller scale than systemic antibiotics.29 The decision to not assign a societal cost of antimicrobial resistance to these prescriptions again biased our results against the medical-management strategy. Despite this, the medical management strategy was the preferred strategy in all 3 versions of the model.

We found that patients in the predefined low-risk group saw the most benefit and lowest relative costs from tympanostomy tube placement, a finding which was counterintuitive. This outcome was impacted by differences in both cost and quality of life. Children assigned to the tympanostomy tubes strategy in the high-risk cohort required more medical and nonmedical resources than those assigned to the medical management strategy, and gained 0.17 QALDs, the equivalent of 4 symptom-free hours, in 2 years. In contrast, although those assigned to the tympanostomy tubes strategy in the low-risk cohort, did incur more costs of both medical and nonmedical resources than those assigned to medical management, the difference was smaller than that in the high-risk cohort. Low-risk patients in the tympanostomy tubes strategy also accrued 1.2 additional QALDs over the 2-year time period. However, the cost for this additional benefit exceeded the $100 000/QALY willingness-to-pay threshold.

By simulating the experience of large patient populations, Markov analyses identify strategies that benefit the most individuals most often and lend themselves to broader interpretations. Our study findings may also inform shared decision-making discussions. Previous studies have cited that illness symptoms, missed work, and use of medical resources contribute to the individual burden associated with recurrent AOM.5,30 Patients in both treatment strategies experienced subsequent episodes of AOM and use of both non-medical and medical resources. Individual experience of AOM symptoms or otorrhea may differ from that of a population, making either strategy more or less valuable on an individual basis.

This study has a number of strengths. Data were drawn from a randomized-control trial of young children with recurrent AOM, all of whom had received the pneumococcal conjugate vaccine, and included cost-effectiveness analysis as an aim. Episodes of AOM were diagnosed by trained otoscopists and treated according to a standardized protocol. Quality of life information was collected with daily electronic symptom diaries using validated scales for rating symptoms severity and functional outcomes. Resource utilization was documented at regular intervals, allowing for a comprehensive assessment of individual quality-of-life experiences.

This study has several limitations. We could not find a quality-of-life utility value for otorrhea in the literature. However, utility of otorrhea did not influence the conclusions of the primary analysis; at no utility value for otorrhea did tympanostomy tubes placement become the preferred strategy. Patients who did not complete the full 2 years of the original trial were assumed to have medical costs and quality of life that did not vary significantly from those experienced during trial participation, an assumption that could bias results toward either management strategy. The 2-year time horizon was based on the 2 years of trial data collected. Given the decreasing frequency of AOM with age and the self-limited nature of tympanostomy tubes, it was not reasonable to extrapolate beyond the 2 years available follow-up data. Additionally, the model does not account for long-term impacts of recurrent AOM in childhood. Given the age of patients enrolled, it is likely that the model captures the time period when individuals are most likely to experience AOM, and AOM to benefit from medical or surgical interventions. Adverse antibiotic events can include diarrhea, vomiting, candidiasis, non-candidal rash, other allergic reaction, and unspecified adverse events.31 Given the trial design, it is possible that adverse events other than protocol-defined diarrhea and diaper dermatitis which were not brought to medical attention may not have been included in the model. We attempted to include utilization of nonmedical resources by including both missed work and special childcare needs but were unable to account for the costs of informal childcare arrangements or missed school. Diagnosis of AOM in the trial was made by trained otoscopists. This model does not account for overdiagnosis of AOM, which is estimated to occur in up to 25% of AOM diagnoses.32 The trial was conducted in 2 large children’s hospitals and thus data may not be directly applicable to other settings.

The additional costs associated with the tympanostomy tube placement strategy and limited benefit suggest that non-surgical medical management is the economically preferred strategy.

Glossary

AOM

Acute otitis media

ICER

Incremental cost-effectiveness ratio

QALD

Quality-adjusted life-day

QALY

Quality-adjusted life-year

US

United States

Footnotes

A.H. reports owning stock in Kaizen Bioscience, holding patent 9, 636, 007 B2 on a method and apparatus for aiding diagnosis of otitis media by classifying tympanic-membrane images, and holding patent 9, 987, 257 B2 on pediatric oral-suspension formulation of amoxicillin–clavulanate potassium and the method for use, licensed to Kaizen Bioscience. The other authors declare no conflicts of interest.

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