Cost-Effectiveness Analysis in Health Program Evaluation

Abstract

The growing demand for prospective evaluation enhances the popularity of cost-effectiveness analysis, a technique for identifying best uses of scarce resources. Defined in diverse ways during its short history, cost-effectiveness analysis is now seen as the evaluative comparison of monetary and nonmonetary dimensions of impact. The cost-effectiveness ratio for health programs divides monetary effects by health effects. Decisions on competing alternative programs should be resolved by regarding cost-effectiveness ratios on the differences between programs. urrent concern over the limited resources available to fund añ -~ increasing number of public programs and the need to extract maximum benefit from each dollar spent have brought about changesin program evaluation. The traditional emphasis on retrospective = evaluation, in which program performance is addressed after the fact, has been subtly shifted toward prospective evaluation: assessing program capabilities before implementation. Tools of prospective evaluation include decision analysis, benefit-cost analysis, and cost-effective-AUTHORS' NOTE: The authors thank

Priority setting and policy advocacy by nursing associations: A scoping review and implications using a socio-ecological whole systems lens

“…Seven frameworks for priority setting by organizations were identified from the non-nursing literature [15,16,22,68,70,74,75] and one tool was identified from the nursing literature [76]. The frameworks were developed from theoretical, empirical, and practice evidence and depicted macro-level decisions.…”

“…Although variably defined [16,22,70], priority setting at the macro-level referred to the future allocation of resources across diverse program areas or sectors and included decisions about investments in population issues, health conditions, interventions, and/or services. The frameworks incorporated principlebased approaches, which used economic [15,70,75] and ethical [76] criteria to guide decisions. A process-focused approach was also proposed, which depicted conditions for fair and legitimate choice-making [74].…”

Healthcare Rationing by Proxy

“…[1] To achieve this, a complete assessment of the healthcare budget, or what we can refer to as resource allocation, was required. The application of the resource allocation problem involves considering all interventions and the aggregate maximization of outcomes, previously life-years, but now more commonly QALYs, are determined by the consideration of all possible allocations given a fixed budget.…”

“…[19] There are a number of political benefits to the programme evaluation approach: it is infinitely simpler, allows evaluators to focus only on new (costly) interventions and avoids the politically problematic issue of disinvestment (that is, the cancelling of a programme that has become obsolete). [20] The programme evaluation approach does have one significant downfall; it requires the valuation of things that we might ''prefer not to value monetarily'' [1] as it requires that the researcher or decision maker define a threshold of acceptability. In the absence of any real science to consider what an appropriate threshold might be in the US, a $US50 000 per QALY rule of thumb emerged.…”

Integrating costs and outcomes

“…At least one source suggests that multiple outcome measures can be incorporated into the cost-effectiveness approach by use of a ratio with three or more terms (Thompson and Fortess, 1980). As the terms are used here, costs are the resources consumed by a mental health program while outcomes are the intended and unintended effects of the program.…”