Health Economics

Question 1

What is health economics?

Answer 1

Drug development and use in perspective to health and incentives/constraints on clinical decision makers

Question 2

What are the primary methods of funding health systems?

Answer 2

Taxation of the state
Social health insurance
Voluntary of private health insurance
Out of pocket payments
Donations to charities

Question 3

What is healthcare equity?

Answer 3

Fair system of sharing health benefit and cost across community

Question 4

What are the 3 concepts of efficiency?

Answer 4

Technical efficiency
Productive efficiency
Allocative efficiency

Question 5

What is technical efficiency?

Answer 5

No resources wasted

Highest possible therapeutic benefit for given amount of drug

Question 6

What is productive efficiency?

Answer 6

Compares alternative interventions for maximum benefits

Question 7

What is allocative efficiency?

Answer 7

How resource is allocated to those who will benefit the most.

Question 8

What is horizontal equity?

Answer 8

Equal treatment of equals

People viewed as equal in terms of need are able to access and benefit from a healthcare intervention

Question 9

What is a vertical equity?

Answer 9

Unequal treatment of unequals

People viewed as unequal in terms of need may be offered different types of treatment

Question 10

What are financial costs (direct) to the intervention?

Answer 10

Provider costs - drugs, staff

Capital costs - buildings, equipment

Question 11

What are non-financial (indirect) costs involved with the intervention?

Answer 11

Patient costs - travel, prescription charges
Stress, pain, side effects
Productivity costs

Question 12

What are the 5 basic methods of economic evaluation?

Answer 12

Cost minimisation analysis 
Cost effectiveness analysis 
Cost utility analysis
Cost benefit analysis 
Cost consequence analysis

Question 13

What is the cost minimisation method?

Answer 13

When outcomes are the same so select lowest cost

Question 14

What is cost effectiveness analysis method?

Answer 14

Single outcome measures.

Natural units - life years gained, deaths avoided

Question 15

What is the cost effectiveness ratio?

Answer 15

CER = costs of intervention / Health effects produced (eg life years gained)

Question 16

What is incremental cost effectiveness ratio?

Answer 16

ICER = difference in costs between programmes 1 and 2 / difference in health effects between programmes 1 and 2

Question 17

What does the ICER value mean?

Answer 17

Larger ICERs indicate that the cost of obtaining a unit of outcome is higher
Negative ICER means that improvement in outcome and reduction in costs

Question 18

What is the most common measure used in utility (CUA)?

Answer 18

QUALY - combines survival periods (quantity of life) + health status valuations (quality of life).

1 QUALY = 1 year in perfect health

Question 19

What are the advantages and disadvantages on CUA? (Cost Utility Analysis)

Answer 19

Advantages
Allows comparisons for interventions for different conditions
No need to put a monetary value on health state
Can evaluate morbidity and mortality

Disadvantages
Cannot discriminate in mild conditions
Assumption do not hold in chronic conditions
Utility attached to health is often dependent on person experiencing health state

Question 20

What is risk ratio (RR)?

Answer 20

Ratio of two absolute risks

The probability of an outcome in an exposed group to the probability of an outcome in the control group

Question 21

What does a RR of 1 mean?

Answer 21

There is no difference between risk in each group

Question 22

What does a RR < 1 mean?

Answer 22

Event is less likely to occur in the experiment group than in control group

Question 23

What does a RR of > 1 mean?

Answer 23

Event is more likely to occur in the experimental group and than the control group

Question 24

What does NNT mean?

Answer 24

It is the average number of patients treated for one to benefit compared to a control group.
Ideal NNT = 1
Measures the effectiveness of the intervention

Question 25

What is a confidence interval?

Answer 25

Indicate the likely range of results in which a real value is likely to be.

Usually quoted at 95%

Question 26

What is clinical significance?

Answer 26

It is the importance of treatment effect

Question 27

What is statistical significance?

Answer 27

An assessment of the probability that an intervention produces an effect
A p value lower than 5% then result is statistically significant.