Stage 4: Health Economics Flashcards
Definition of opportunity cost
Cost of any choice in terms of next best alternative forgone
Which of the following is true?
Priority setting = Deciding what to fund/ invest in
Rationing = Deciding what to fund/ invest in
Priority setting = Deciding what to fund/ invest in
But when you prioritise 1 thing, you will ration the other
How to calculate QALYs (quality adjusted life years)
QALY = Utility value x Life expectancy in that state
Calculate the QALY gain in the following situation
Obese person’s current utility value is 0.5, would be 0.7 if he exercised
His current life expectancy is 4 years, would be 10 years if he exercised.
What are the QALYs gained in exercising?
Current: 0.54 = 2
Exercise: 0.710 = 7
QALY gain = 5
Which of the following compares interventions with the SAME single outcome
- Cost-Effectiveness Analysis
- Cost-Benefit Analysis
- Cost-Utility Analysis
- Cost-Consequence Analysis
- Cost-Minimization Analysis
- Cost-Effectiveness Analysis
Which of the following compares interventions using QALYs
- Cost-Effectiveness Analysis
- Cost-Benefit Analysis
- Cost-Utility Analysis
- Cost-Consequence Analysis
- Cost-Minimization Analysis
- Cost-Utility Analysis
What unit does Cost-Benefit Analysis compare interventions in?
What about Cost-Utility Analysis?
Cost-Benefit: monetary value
Cost-Utility: QALYs
What unit does Cost-Effectiveness Analysis compare interventions in?
Incremental Cost-effectiveness ratios (ICER)
Small ICER is better than large ICER
Equity vs Efficiency
Equity: Fairness of how resources are allocated
Efficiency: Maximising benefits in face of budgets
Most common Analysis approach used in clinical practice
Cost effectiveness analysis
Negatives of cost effectiveness analysis
Public health programmes are likely to have multiple components and therefore multiple potentially beneficial (or harmful) outcomes
CEA only focuses on a single outcome dimension
It ignores all other effects and if some of these are important then it is possible that the conclusions drawn will be wrong
Can not compare interventions if the single simple outcome is not common across interventions
Negatives of cost benefit analysis
Often just report costs so may ignore benefits or problems with treatment.
Difficult to implement into the NHS due to not valuing health via monetary perspective
