Health Economics Flashcards
Why does health spending increase as a proportion of GDP
- Better consume expectations
- Ageing population
- Increased private health insurance
- Increased labour costs
- Advances in technology
a) Describe hte conceptof efficiency
b) Name the 3 concepts of efficiency
a) When resources are scarce it is important to evaluate how well they are being used to achieve a desired outcome
- Technical efficiency
- Productive efficiency
- Allocative efficiency
a) Describe the concept of technical efficiency
b) When is it achieved?
a) The effectiveness with which a given set of inputs (resources) is used to achieved desired output (health outcome)
b) Achieved when the maximum possible improvement in a health outcome is achieved from a combination of available resources
Describe the concept of productive efficiency
Involves assessing the relative value for money of different interventions, which have outcomes that are directly comparable
The concept of productive efficiency is, therefore, to minimize the cost of resources for a given healthcare outcome or maximize the outcome for a given cost
Describe the concept of allocative efficiency
Involves measuring the extent to which the available resources are allocated to individuals or (a group of people) who will benefit the most
a) What is econmic evaluation?
b) What is the purpose of economic evaluation
a) The process of systematic identification, measurement and valuation of the inputs and outcomes of two alternative activites, and the subsequent comparative analysis of these
b) To inform different types of decision-makers about the efficient allocation of health care resources
What are the different types of economic evaluation?
- Cost-effective analysis
- Cost-utility analysis
- Cost-benefit analysis
Describe the three stages of cost analysis
- Identification - what resoruces might be affected by the programme turn out
- Measurement- How will we monitor the level of resource used?
- Valuation - What is the value of the resource used
What are the outcomes measured in:
a) Cost-effectiveness analysis
b) Cost-utility analysis
c) Cost-benefit analysis
a) Single “natural” unit outcome measure e.g. Cases prevented, years of life saved
b) Quality adjusted life years (QALYs)
b) Money
a) What is the average cost-effectivences ratio (ACER)?
b) When is this used?
b) Independant interventions
a) What is the incremental cost effective ratio equation (ICER)
b) What is it for?
b) For mutually exclusive programs
Draw the cost-effectiveness plane
How do you decice which non-dominant (questionable) intervention is most cost-effective? E.g. costs more and is more effective vs costs less and less effective
Calculate the incremental cost-effectiveness ratio
What are the principles of calculating ICERs
- Rank interventions from least to mostly costly
- Exclude dominant interventions e.g. intervention is more effective and less costly
- Calculate the ICER for each successive intervention: incremental cost/incremental QALYs
- Identify interventions that are subject to extended dominance: less effective, higher ICER
- Recalculate the ICERs after excluding interventions which are subejct to extended dominance
a) Calculate the ICER
b) Which intervention is most cost-effective
a) Exclude B as it is dominated by A
ICER = (£20,000-£10,000) - (2.8-2) = £12,500
b) C is best as society is WTP £20,000 per QALY
