Health Economics

Question 1

Distinguishing characteristics of health care evaluation*

Answer 1

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1) Are both costs (inputs) and consequences (outputs) of the alternatives examined?
- NO Examines only consequences

Is there comparison of two or more alternatives?
- NO 1A PARTIAL EVALUATION: Outcome
Description
- YES 3A PARTIAL EVALUATION Efficacy or effectiveness evaluation

2) Are both costs (inputs) and consequences (outputs) of the alternatives examined?
- NO Examines only costs

Is there comparison of two or more alternatives?
- NO 1B PARTIAL EVALUATION: Cost
Description
- YES 3B PARTIAL EVALUATION Cost analysis

3) Are both costs (inputs) and consequences (outputs) of the alternatives examined
- YES
Is there comparison of two or more alternatives?
- NO 2 PARTIAL EVALUATION Cost-outcome description

4) Are both costs (inputs) and consequences (outputs) of the alternatives examined
- YES
Is there comparison of two or more alternatives?
- YES 4 FULL ECONOMIC EVALUATION
Cost-minimisation analysis
Cost-effectiveness analysis
Cost-utility analysis
Cost-benefit analysis

Question 2

Important concepts

Answer 2

Perspective
Incremental cost
Discounting
Sensitivity analysis

Question 3

Should we use the drugs below?*

Answer 3

• A new drug is equally effective and has similar adverse event profile to the old drug but costs less?
• A new drug is equally effective and has similar adverse event profile to the old drug but costs more?
• “Cost-minimisation analysis”
• A new drug is more effective and has similar adverse event profile to the old drug and costs the same?
• A new drug is less effective and has similar adverse event profile to the old drug and costs the same?
• “Cost-effectiveness analysis”

Question 4

Comparable units of outcome are required

Answer 4

• If two treatments reduce mortality then Life Years Gained (LYG) can be used to compare across diseases. This does not capture QoL
• If two treatments alter QoL we need to know how important the outcomes are to the patient, i.e. their utility to the patient.

Utility is measured on a scale of 0 (death) to 1 (full health)

-A combined measure is required for treatments that lengthen life and affect the QoL (QALY)

Question 5

Results: consider*

Answer 5

What unit has been used for the outcome/s? (e.g. life-years, QALYs, natural units of effectiveness e.g. pain relief, monetary)
Has the incremental cost and the incremental benefit over the comparator treatment/s been calculated?
What does this show?
Do the conclusions change with a sensitivity analysis?

Question 6

Results: sensitivity analysis*

Answer 6

• Data in economic evaluations will contain uncertainties:
• Costs
• Clinical effectiveness
• Utilities
• Probabilities
• Discounting
• Extrapolation beyond existing data

-These can lead to different conclusions and should be tested in a sensitivity analysis