Outcomes In Cost-effectiveness Analyses Research Articles

The role of cost-effectiveness analysis in health and medicine. Panel on Cost-Effectiveness in Health and Medicine

To develop consensus-based recommendations guiding the conduct of cost-effectiveness analysis (CEA) to improve the comparability and quality of studies. The recommendations apply to analyses intended to inform the allocation of health care resources across a broad range of conditions and interventions. This article, first in a 3-part series, discusses how this goal affects the conduct and use of analyses. The remaining articles will outline methodological and reporting recommendations, respectively. The Panel on Cost-Effectiveness in Health and Medicine, a nonfederal panel with expertise in CEA, clinical medicine, ethics, and health outcomes measurement, was convened by the US Public Health Service (PHS). The panel reviewed the theoretical foundations of CEA, current practices, and alternative procedures for measuring and assigning values to resource use and health outcomes. The panel met 11 times during 2 1/2 years with PHS staff and methodologists from federal agencies. Working groups brought issues and preliminary recommendations to the full panel for discussion. Draft recommendations were circulated to outside experts and the federal agencies prior to finalization. The panel's recommendations define a "reference case" cost-effectiveness analysis, a standard set of methods to serve as a point of comparison across studies. The reference case analysis is conducted from the societal perspective and accounts for benefits, harms, and costs to all parties. Although CEA does not reflect every element of importance in health care decisions, the information it provides is critical to informing decisions about the allocation of health care resources.

The Role of Cost-effectiveness Analysis in Health and Medicine

Objective. —To develop consensus-based recommendations guiding the conduct of cost-effectiveness analysis (CEA) to improve the comparability and quality of studies. The recommendations apply to analyses intended to inform the allocation of health care resources across a broad range of conditions and interventions. This article, first in a 3-part series, discusses how this goal affects the conduct and use of analyses. The remaining articles will outline methodological and reporting recommendations, respectively. Participants. —The Panel on Cost-Effectiveness in Health and Medicine, a nonfederal panel with expertise in CEA, clinical medicine, ethics, and health outcomes measurement, was convened by the US Public Health Service (PHS). Evidence. —The panel reviewed the theoretical foundations of CEA, current practices, and alternative procedures for measuring and assigning values to resource use and health outcomes. Consensus Process. —The panel met 11 times during 21/2 years with PHS staff and methodologists from federal agencies. Working groups brought issues and preliminary recommendations to the full panel for discussion. Draft recommendations were circulated to outside experts and the federal agencies prior to finalization. Conclusions. —The panel's recommendations define a costeffectiveness analysis, a standard set of methods to serve as a point of comparison across studies. The reference case analysis is conducted from the societal perspective and accounts for benefits, harms, and costs to all parties. Although CEA does not reflect every element of importance in health care decisions, the information it provides is critical to informing decisions about the allocation of health care resources.

Health-related quality of life assessment and the pharmaceutical industry.

Concerns about cost containment in healthcare and interest in the impact of medical treatment on patient health status and well-being have increased the emphasis on health-related quality of life (HRQOL) research. HRQOL assessment as part of the development and evaluation of pharmaceuticals is a reality and is likely to increase over time. HRQOL studies may assist industry in the regulatory approval process, for marketing purposes, and to assist physicians and healthcare managers in making decisions about alternative drug therapies. HRQOL studies provide physicians with complete information about the benefits and risks of drug treatments in terms of patient physical, psychological, and social functioning and well-being. HRQOL measures, especially health utility assessments, can contribute to defining health outcomes in cost-effectiveness analyses. HRQOL studies need to be planned early in the drug development process and careful attention must be made to selecting comparative medical treatments, instrumentation, data collection protocols, length of follow-up, and sample size for these studies. It is important to address issues of investigator and other sources of bias. There is evidence that the pharmaceutical industry is increasing the use of HRQOL outcomes in clinical studies. Healthcare decision-makers, physicians and patients are demanding that industry demonstrate the impact of a new drug on patient HRQOL in addition to safety and efficacy. Clearly, HRQOL represents an important indicator of the benefit of pharmaceuticals.

A Survey of Recent Research in Health Economics

The difference between these two often confused approaches is discussed by Weinstein and Stason [21]. Cost-benefit analysis must value all out comes, including human lives and quality of life, in dollar terms. On the other hand, a cost-effective ness analysis places priorities on alternative ex penditures without requiring that the dollar value of life and health be assessed. Health outcomes in cost-effectiveness analysis must be expressed in commensurate units but not necessarily in dollars. While it is obviously difficult to measure benefits with precision, it is not necessarily any easier to measure costs. Klarman [10] points out that while the ability to measure with precision is taken for granted, this is only true when a firm produces a single good or service. In the case of joint production, it is possible to calculate mar ginal cost for each product, but not its average cost. Changes in technology also introduce a heightened degree of uncertainty concerning future benefits and costs. Further complicating the question of are some of the very disturbing costs of being sick: pain, discomfort, and grief. None of these carries a price tag, and lack of these problems represents intangible benefits which accrue to patients, as well as their friends, relatives, and society at large. Often, humanitarians oppose cost-benefit analy sis because it sets a price on human life. Grosse [6] argues that this results from a misunderstanding of the true nature of as they are considered in decisionmaking. One does not measure the cost of saving a human life in dollars but rather in terms of alternative lives to be saved or other social values sacrificed. There are many possible ways to measure health benefits, such as reduction of disabling con ditions, reduction of premature death, or postpone ment of death. The inability to measure benefits in commensurable units means that while can still be measured and compared, judgments and political processes must be utilized to make the final choices. Despite the potential usefulness of cost-benefit analysis, many such studies remain uncompleted due primarily to lack of data, particularly data regarding benefits of past and existing programs and projects. Another pitfall in the use of cost benefit analysis is the tendency to regard the single number derived as a result (the cost-benefit ratio) as being more precise than it actually is. It must be remembered that all of the limitations noted above are contained in this final result Cost-benefit analy sis should be used with extreme care and full knowledge of its advantages and shortcomings. A higher value could be placed on the use of this analytical technique for health services if better and more complete data were available.