Economic Evaluation

Question 1

What makes health economics difficult?4

Answer 1

3rd party involved so lots of uncertainty
Health care interventions have high prices
New treatments only show small improvement
Can’t do everything

Question 2

When are economic analysis tools needed?

Answer 2

When decisions have to be made about scarce resources

Question 3

3 points about demand for healthcare

Answer 3

Never enough to satisfy everyone’s need - economic good
Most systems provide it free or highly subsidised
Patients wish to consume resources where perceived individual benefit is higher than cost to individual

Question 4

What is the result of health economics conditions?

Answer 4

Imbalance: patient’s demands are > system able to provide

Question 5

Opportunity cost:

Answer 5

Benefit that would be derived from using a resource in its next best alternative use -> benefit forgone

Question 6

What are the 2 things economic evaluation in healthcare require? what is this needed for?

Answer 6

Comparison of two or more options
examination of costs and outcomes
Needed for licensing by NICE

Question 7

What does economic evaluation not involve?

Answer 7

Just choosing the cheaper option

Question 8

Four different types of economic evaluation:

Answer 8

1. Cost effectiveness analysis 2. Cost utility analysis 3. Cost minimisation analysis 4. Cost benefit analysis

Question 9

What is cost effectiveness analysis?

Answer 9

Finds cost per extra outcome gained (eg. per extra MI avoided)

Question 10

Cost utility analysis:

Answer 10

Uses QALYs as outcome

Question 11

Cost minimisation analysis:

Answer 11

Looks at cost difference if outcomes are the same

Question 12

Cost benefit analysis:

Answer 12

How much are we willing to pay per gain in outcome (eg per QALY.

Question 13

What are the four outcomes in different analysis scenarios?

Answer 13

Effect, utility, cost minimisation, cost benefit analysis

Question 14

Net monetary benefit formula:

Answer 14

(willingness to pay x delta outcomes)- delta cost

Question 15

Formula for number of QALYs

Answer 15

utility weight of health state x time spent in that state

Question 16

What properties must utility weights have?

Answer 16

Interval properties and be anchored (death and perfect health)

Question 17

How to assure to preferences:

Answer 17

Always be such that people have higher utility

In order to value different health states, we must know people’s preferences

Question 18

Two types of preference - what to use in health care?

Answer 18

Revealed and stated, can only use stated in health care

Question 19

Ways to elicit health state preferences:

Answer 19

Rating scale, standard gamble, time trade off, persons trade off

Question 20

Time trade-off idea

Answer 20

How many years of life would you give up to enjoy full health rather than in current state

Question 21

What is the time tradeoff formula for w:

Answer 21

w=(T-M)/T

Question 22

Two limitations to TTO and choice based measurement techniques:

Answer 22

1. Results likely to be affected by participant’s time preference - not everyone views life expectancy the same way
2. Based on stated preference - not guaranteed to be accurate

Question 23

4 other patient reported outcome measures:

Answer 23

SF 6D, HUI2, 15 D, AQoL

Question 24

3 questions for incremental cost effectiveness ratio:

Answer 24

1. Does treatment cost more or less compared to another option
2. Does treatment result in better or worse outcomes compared to another option
3. What is cost per outcome gained?

Question 25

ICER formula

Answer 25

cost for new -cost for old/QALY new- QALY old

Question 26

2 questions to ask when using the WTP threshhold:

Answer 26

• Does health benefit from extra effectiveness justify extra cost?
• Could we achieve greater health benefit by using those extra resources in another way within the health system?

Question 27

What is NICE’s position in regards to ICER?

Answer 27

30k - need a very strong case

Question 28

What are the differences in perspective of NHS and personal social services vs Societal view;

Answer 28

NHS and PSS only look at the intervention itself, other drugs and surgical costs etc, service use costs
Societal perspective also looks at out of pocket costs, time off work, social services, cost to judicial system, loss of life and QALYs

Question 29

How is data over costs collected in the UK

Answer 29

tend to use NHS +PSS unless clear societal effect
GP attendance from patients
Other info from patients

Question 30

Sensitivity analysis use :

Answer 30

Every piece of data has some uncertainty so check and see what effect this has on end results - how robust are these and what assumptions had to be made

Question 31

What to use in sensitivity analysis to convince decision makers?

Answer 31

Probabilistic sensitivity analysis

Question 32

5 limitations to economic evaluation:

Answer 32

It only provides one piece of info in the healthcare decision making process
Precision of results (e.g. missing data not always appropriately dealt with)
Consistency of results
Inappropriate use of resources saved
ethics?