Economic Evaluation of Health Programmes

Economic Evaluation of Health Programmes

·       Economic evaluation in healthcare helps policymakers, administrators, and stakeholders assess the efficiency and effectiveness of health programs.

·       Various methods and techniques are used to compare costs and outcomes of different health interventions.

1. Cost-Minimization Analysis (CMA)

Concept:

• Used when two or more health interventions achieve the same outcome, and the goal is to determine the least costly option.
• It assumes equal effectiveness between interventions and focuses solely on cost comparison.

Example:

• Generic vs. Branded Drugs: If a hospital is considering whether to procure a generic version of a drug instead of a branded version (both having the same therapeutic effect), a cost-minimization analysis would help in choosing the more cost-effective option.

2. Cost-Effectiveness Analysis (CEA)

Concept:

• Compares costs and health outcomes in terms of natural units, such as life-years gained, reduction in disease incidence, or improvement in health status.
• Used when outcomes are not easily expressed in monetary terms.

Example:

• Screening for Hypertension: A program to screen and treat hypertension in a community may be evaluated based on the cost per life-year gained or the cost per case of hypertension detected and treated.

3. Cost-Utility Analysis (CUA)

Concept:

• A form of cost-effectiveness analysis that considers quality of life by using Quality-Adjusted Life Years (QALYs) or Disability-Adjusted Life Years (DALYs).
• Helps in comparing interventions that impact both quality and length of life.

Example:

• Dialysis vs. Kidney Transplant: A cost-utility analysis can compare the cost per QALY gained in patients undergoing long-term dialysis versus those receiving a kidney transplant to determine which option provides better quality-adjusted life years per cost spent.

4. Cost-Benefit Analysis (CBA)

Concept:

• Both costs and benefits are measured in monetary terms, allowing direct comparison of different interventions.
• If benefits exceed costs, the intervention is considered economically justified.

Example:

• Immunization Programmes: A CBA may compare the cost of administering a vaccination program with the financial benefits of reduced hospitalizations, improved productivity, and lower healthcare costs due to prevented diseases.

5. Cost-Consequence Analysis (CCA)

Concept:

• Presents costs alongside multiple outcomes but does not combine them into a single measure like QALYs or DALYs.
• Useful when decision-makers need a broader perspective on costs and outcomes.

Example:

• Community Health Programs: An evaluation of a community-based intervention for diabetes management may include cost analysis, number of hospitalizations prevented, reduction in blood glucose levels, and improvement in patient satisfaction—all presented separately.

6. Budget Impact Analysis (BIA)

Concept:

• Assesses the affordability of an intervention by estimating its impact on a healthcare budget over a specific time.
• Helps in financial planning and decision-making.

Example:

• Introducing a New Cancer Drug: Before approving a new cancer drug in a public health insurance scheme, a budget impact analysis would estimate the expected costs for the government or insurance provider over the next five years.

Choosing the Right Economic Evaluation Method

Method	Outcome Measurement	Best Used When	Example
CMA	Identical outcomes	Choosing the least costly alternative	Generic vs. branded drugs
CEA	Natural units (life-years, cases prevented)	Comparing interventions with similar goals	Cancer screening program
CUA	QALYs or DALYs	Considering quality & length of life	Dialysis vs. kidney transplant
CBA	Monetary values	Comparing interventions with different outcomes	Immunization program
CCA	Multiple separate outcomes	Providing a broad comparison	Diabetes management programs
BIA	Budget estimates	Evaluating financial feasibility	Government funding for a new drug

 

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