we may find an identical number of procedures performed but possibly different

We may find an identical number of procedures

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we may find an identical number of procedures performed, but possibly different costs. The principle decision rule is focused on the costs per procedure successfully performed, where the least cost course of action is determined to be the efficient choice (Drummond et al., 1997).
FIGURE 14-1 Economic evaluation Source: Data from Drummond, MF et al., (1997) Economic Evaluations of Health Care Programmes, Oxford: Oxford University Press. Cost-Effectiveness Analysis In this case, the output of the courses of action is common across alternatives, but the alternatives have varying degrees of success in achieving the output. An example would be the comparison of different diabetes prevention programs (Gray, 2000 ; Elixhauser, 1989 ). The decision rule is based on the cost per unit of output or output per unit of costs. The decision maker selects the course of action that yields the most output per dollar spent or the least cost per output. The latter decision is used when the decision maker is working within a given budget. This implies that there is a single, common affect that is constrained, and that the alternatives are within the same range of scale. This analysis can be done considering any courses of action with a common output. The worth of the courses of action is assumed to be positive. Here, we assume that the courses of action have value for the population and are efficacious (Drummond et al., 1997). TABLE 14-2 Summary of Economic Evaluation Methods. Method Measure of costs of courses of action Identification of outputs Measurement of outputs Cost- minimization analysis Dollars Identical across alternatives None
Method Measure of costs of courses of action Identification of outputs Measurement of outputs Cost- effectiveness analysis Dollars Single, common output among alternatives, achieved in varying degrees Natural units, e.g., disability days reduced or reduction in blood glucose levels Cost-utility analysis Dollars Single or multiple outputs, not necessarily common across alternatives, and achieved in varying degrees Healthy days or QALYs Cost-benefit analysis Dollars Single or multiple outputs, not necessarily common across alternatives, and achieved in varying degrees Dollars The outputs can be health effects directly or measures that show improvements in health status. For instance, one can compare a prevention program versus a chronic care program in terms of disability days saved per dollar invested in each program (Hatzriandreou et al., 1988; Tengs et al., 1995). In cost-effectiveness analysis, there is a dominant dimension of success that is considered. If there is an equivalent level of effectiveness, it is best to perform a cost-minimization analysis. Also, it is important to be open to the possibility of using more sophisticated analyses, such as cost- benefit analysis, if there is more that one dimension of effectiveness.

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• Spring '17
• Rusnak,J
• Economics