Introduction To Health Economics Flashcards
What is opportunity cost
The opportunity cost of an activity is the sacrifice in terms of the benefits forgone from not allocating resource to the next best activity
For example-
To spend resource on on activity such as heart transplants means a sacrifice in terms of a lost opportunity cost elsewhere such as fewer hip replacements
What is economic efficiency
It can be achieved when resources are allocated between activities in such a way as to maximise the benefit
What is the economic evaluation
Economic evaluation is the assessment of efficiency
It is a comparative study of the costs and benefits of alternative health care interventions for some given disease
Costs and benefits are evaluated
How do we measure health benefit
Natural units
QALYs
Monetary Value
What does QALY stand for
The Quality-adjusted life year
What does QALYs combine
It combines the length of life with quality of life
What is the most commonly used metric for economic evaluation
QALYs
What is meant by monetary value
The willingness to pay, so how much is someone willing to pay for the health benefit
How do we measure health costs
Monetary units
All relevant costs should be measured eg- drug treatment, hospital stays, appointments, managing adverse effects, scans and imaging
What costs does it being to the NHS
What are the 4 types of economic evaluation
Cost-effectiveness analysis
Cost-utility analysis
Cost-benefit analysis
Cost-minimisation analysis
What are the outcomes measured in cost-effectiveness analysis
Outcomes are measured in natural units
What are the outcomes measure in the cost-utility analysis
Outcomes measured in QALYs
What are the outcomes measured in the cost-benefit analysis
Outcomes are measured in monetary units
What are the outcomes measured in for the cost-minimisation analysis
Outcomes are measured in any units
Just minimise the costs
What is the incremental cost effectiveness ratio
Difference in costs / difference in benefits
