Economic Evaluation Flashcards
There are four basic methods of economic evaluation that you need to be familiar with:
cost-effectiveness analysis (CEA)
cost-benefit analysis (CBA)
cost-utility analysis (CUA)
cost-minimisation analysis (CMA)
Cost-effectiveness analysis (CEA)
CEA compares a number of interventions by relating costs to a single clinical measure of effectiveness (e.g. symptom reduction, improvement in activities of daily living).
cost-effectiveness ratio = total cost / units of effectiveness
For example consider this study on anorexia which compared the costs of three approaches to treatment (inpatient, specialist outpatient, and general outpatient) per improvement on the MorganRussell Average Outcome Scale (Byford, 2007).
Other examples:
�’s spent per lives saved
�’s spent per each depression free day
CEA is generally done when CBA cannot be performed due to the inability to monetise benefits.
Combining both costs and effects, the findings of a CEA are usually reported as an incremental cost-effectiveness ratio (ICER).
ICER intervention A versus intervention B = (costs A - costs B) / (effects A - effects B)
A treatment that is found to be BOTH more costly AND less effective is said to be dominated by the other treatment.
The advantage of expressing health outcomes in natural units is that these are often observable, relatively easy to measure and, often, meaningful to clinicians. The disadvantage, however, is that they limit the scope of comparisons. For example, cost-effectiveness analyses using outcomes such as depression-free days achieved only allow comparisons with other interventions that can be expressed using exactly the same metric. Survival-related outcomes such as life years gained allow comparisons over a broader range of conditions, but they disregard morbidity and quality of life.
Cost-benefit analysis (CBA)
CBA is a technique in which all the costs and benefits of an intervention are measured in terms of money. A CBA is used to establish which of the alternatives has the greatest net benefit.
CBA requires that all the consequences of an intervention, such as life-years saved, treatment side-effects, symptom relief, disability, pain and discomfort, are allocated a monetary value.
CBA is relatively rarely used in mental health service evaluation mainly due to the difficulty in converting benefits from mental health programmes into monetary values.
Cost-utility analysis (CUA)
CUA is a special form of CEA in which health benefits / outcomes are measured in broader, more generic ways enabling comparisons between treatments for different diseases and conditions.
Multidimensional health outcomes are measured by a single preference- or utility-based index such as the QALY.
Quality-Adjusted-Life-Years (QALYs). QALYs are a composite measure of gains in life expectancy and health-related quality of life. One QALY is equal to 1 year of life in perfect health. QALYs are calculated by estimating the years of life remaining for a patient following a particular treatment or intervention and weighting each year with a quality-of-life score (on a 0 to 1 scale). The quality of life score can be negative in situations where the outcome is considered to be worse than death (death = 0 on the scale).
CUA offers something that CEA cannot, which is to compare across treatments for different conditions. In principle, it is possible to compare treatments for, say, cancer with, say, schizophrenia to determine which is the most efficient at producing health gain in the form of QALYs.
Findings of CUA are often reported as an incremental cost-utility ratio (ICUR).
ICUR intervention A versus intervention B = (costs A - costs B) / (QALYs gained by A - QALYs gained by B)
Byford (2007) Economic evaluation of a randomised controlled trial for anorexia nervosa in adolescents. The British Journal of Psychiatry Oct, 191 (5) 436-440.
Cost-minimisation analysis (CMA)
An economic evaluation in which consequences of competing interventions are the same and in which only inputs, that is, costs are taken into consideration. The aim is to decide the least costly way of achieving the same outcome.
There are three main types of costs in economic evaluation studies:
Direct - those associated directly with the healthcare intervention (e.g. staff time, medical supplies, cost of travel for the patient, childcare costs for the patient, costs falling on other social sectors such as domestic help from social services)
Indirect - those incurred by the reduced productivity of the patient (e.g. time of work, reduced work productivity, time spent caring for the patient by relatives)
Intangible - those that are difficult to measure (e.g. pain or suffering on the part of the patient)
