Economic Evaluation of Health Care

Transcription

1 Economic Evaluation of Health Care (Evaluasi Ekonomi untuk Pelayanan Kesehatan) Getting the best value for health spending Prof. dr. Bhisma Murti, MPH, MSC, PhD Institute of Health Economic and Policy Studies (IHEPS), Department of Public Health, Faculty of Medicine, Universitas Sebelas Maret

2 What is Economic Evaluation? Economic evaluation is the comparative analysis of alternative courses of action in terms of both their costs and consequences Cost (resources, inputs A,B,C) Health care (intervention or program A,B,C) Consequence (benefit, utility, outcome, effect A,B,C)

3 Non-health care The Rationale for Economic Evaluation in Health Care Resources are scarce (budget constraint, limited number of health care staff, lack of medicine, etc.) so they must be used efficiently and equitable Clinical decision making has cost implication to patient, insurance company, and government that pay for the health care provided Economic evaluation provides a scientific tool for selecting the most costeffective health intervention Health care Budget constraint Budget relaxed

4 How Do We Do Economic Evaluation? Competing alternatives (saling bersaing) Limited budget Intervention A? Intervention B? Intervention C? Decision rule: Choose the most costeffective intervention (the best value for limited budget) Cost-effective intervention Budget Population health

5 Technical Efficiency (Efisiensi Teknis) Produce the same level of output with less cost or higher level of output with the same cost (cost-efficiency) Intervention A costs Rp 100,000,000 Choose Intervention B costs Rp 200,000,000 Choose intervention A because it costs less to produce the same level of output as intervention B

6 Non-health programs Allocative Efficiency (Efisiensi Alokatif) Resources are allocated such that community welfare at large is maximized Allocative efficiency can be achieved if all parties across sectors produce efficiently Allocatively efficient because resources allocated meet the highest utility to the community) Health programs Utility (welfare) to the community at large Allocatively inefficient (too much health program)

7 Types of Economic Evaluation Types of economic evaluation: 1. Cost-effectiveness analysis (CEA) Cost-Minimization Analysis (CMA) 2. Cost-utility analysis (CUA) 3. Cost-benefit analysis (CBA) Full economic evaluation compares both costs and consequences of two or more alternatives (Drummond et al. 2005)

8 Cost-Effectiveness Analysis Compares alternative interventions where costs are measured in monetary term and benefits in natural units: Number of patients showing better clinical outcome Number of infants immunized (note: both the above examples refer to an immediate outcome of health care intervention) Number of child death averted Years of life gained, etc. Can be used to address technical efficiency Where the level of health benefits of all alternatives are equal, so only costs of the alternatives to be compared, this CEA is called Cost-Minimization Analysis (CMA)

9 Cost-Utility Analysis Compare alternative interventions where health benefits are measured in QALYs, DALYs, HYEs, HALYs, etc Quality-Adjusted Life Year (QALYs) are valued on a utility (U) index where U=1 represents perfect health and U=0 represents death Example of QALYs: 5 years of perfect health = 5 QALYs 3 years of perfect health followed by 2 years in a state valued to be 0.8 of perfect health= (3 years x 1U) + (2 years x 0.8U) = 4.6 QALYs Can address both technical efficiency and allocative efficiency

10 What is QALY? Quality-adjusted life year (QALY) is a measure of health benefit or health state that combines the quantity and quality of life Quality of life 1 Improved quality of life with program QALY without program Improved quantity of life with program 0 Time

11 Cost-Benefit Analysis Comparing alternatives where both costs and benefits are measured in monetary terms Valuation method of health benefits: 1. Human capital approach 2. Willingness to pay (WTP) Can compare two or more interventions across different sectors (e.g., health, education, transportation) according to their net effects on community welfare Can address allocative efficiency Costs Health benefits

12 Basic Model of Decision Making Program A Probability A Consequences CHOICE Consequence A Program B Probability B Consequences An economic evaluation can be performed within the context of an experiment or other studies, a simulation model, or their combination Consequence B

13 Decision Rule Choose alternative intervention with lower C/E Ratio (CER) CER+ CER++++ Choose Intervention A

14 CEA for Independent Interventions For example: Oral Rehydration Therapy and Immunization are independent programs, each aims to avert child mortality For independent intervention, calculate the cost-effectiveness ratios (CERs): CER= C/E C= cost of intervention E= effectiveness of intervention CER of each intervention implies comparison with do-nothing alternative Draw a table comparing the alternatives List the alternatives from the most effective to the least effective one Compare the CERS, select the most cost-effective alternative

15 CEA for Mutually Exclusive Interventions For example: current immunization program and immunization plus nutrition program are mutually exclusive. Added nutrition element is called incremental. For mutually exclusive programs, calculate the incremental costeffectiveness ratio (ICER): ICER= (C1 C2) / (E1 - E2) C1= cost of program 1 C2= cost of program 2 E1= effectiveness of program 1 E2= effectiveness of program 2 Draw a table comparing the alternatives List the alternatives from the least effective to the most effective one Compare the ICERS, exclude the dominated alternative Redraw a new table until 2 alternatives left

16 Cost difference (ΔC), How To Compare and Choose the More Cost-Effective One among Alternative Interventions New intervention more costly, less effective ( Excluded ) New intervention less costly, but also less effective ( Questionable ) Current Intervention New intervention more costly, more effective ( Cost-effective ) New intervention less costly, more effective ( Dominance ) Effectiveness difference (ΔE) Cost-effectiveness plane demarcates acceptable ICER Alternative with ICER below and to the right of the plane are likely to be acceptable. *Bell et al., 2006

17 Summary (Ringkasan) Resources are scarce, so they must be used efficiently and equitably Economic evaluation provides a scientific tool for clinicians and health planners to choose the most efficient health intervention to attain the highest possible health status of the patient and community

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