Pharmacoeconomic Analysis Pt2

Question 1

Cost and benefits and points of view

Answer 1

• Generally seek to get the most benefits with the lowest cost; but this depends on ones point of view (perspective)
  a) Providers: health regions, hospitals, practitioners
  
  • Clinical outcomes and service funding
    b) Payers: insurers both public and private
  • Economic outcomes and sources of revenue
    c) Patients: patients and their families
  • Humanistic outcomes and OOP expenses

Question 2

What are the different viewpoints and costs

Answer 2

• Costs are affected by the scope of the perspective
  a) hospitals
  
  • costs associated with treating (wages, drugs, supplies) patients associated with the patients stay in the hospital
    B) Ministry of health
  • Include all out of hospital care costs (such as visits to family doctor)
    c) Society
  • Includes costs to other public agencies, costs to patients or families and costs to society due to lost of production

Question 3

What viewpoints are best

Answer 3

• Broader viewpoints
  
  • This avoids cost shifting: putting the cost on another viewpoint rather then the one that affects you

Question 4

What is discounting

Answer 4

• Costs and benefits of an action happen at different times
  
  • The timing of costs and benefits affects how we value them in relative terms
  • Discounting is adjusting future plans as they are not as valued

Question 5

• Two types of gratification

Answer 5

a) Delayed gratification
- Pay first and wait to benefit later
b) Immediate gratification
- Pay later and benefit now

Question 6

• What is the purpose of discounting

Answer 6

• To adjust the value of costs and benefits to reflex how we value them at the moment
  a) Time preference: tend to prefer benefits sooner and costs later
  
  • Causes loan interest

Question 7

• What is the time-value trade off

Answer 7

• You get delayed gratification for an interest price

Question 8

How to set the discount rate

Answer 8

• r,
  
  • Saving and lending markets reflect consumer time preference

Question 9

What are the implications of a higher discount rate

Answer 9

• The discount rate increase the relative value of long term benefits and costs will decline

Question 10

What is sensitivity analysis

Answer 10

a) A one way or univariate analysis
- Change one variables on the evaluate conclusions (best and worse case scenarios)

Question 11

Scenario or multivariate analysis

Answer 11

• Impact of changing two or more variables (best and worse case scenarios)
  
  • Creates a single distribution curve which is based on probability distribution of each variable

Question 12

What is the decision plane

Answer 12

a) Inferior: less effective and more costly
b) Dominant: more effective and less costly

Question 13

• What is the cost effective threshold

Answer 13

• Tells whether it is the new therapy will be cost effective

Question 14

• What happens when economic analysis collides with real world decisions

Answer 14

• Objective of economic analysis is not cost containment, but rather to maximize efficiency (based on comparing new therapies with those with established effectiveness
  
  • A tool should intended to assist decision making (it shouldn’t be used to replace judgement)

Question 15

What is the Oregon plan

Answer 15

• A project that ranked things based on utility x time (and cost) to make a rating but this was useless as it didn’t tell us anything
  
  • Rather picked the most important things to treat and ranked them after