Background: Relative effectiveness has become a key concern of health
policy. In Europe, this is because of the need for early information to guide
reimbursement and funding decisions about new medical technologies. However, ways that
effectiveness (does it work?) and efficacy (can it work?) might differ across health
systems are poorly understood.Methods: This study proposes an analytical framework, drawing on production
function theory, to systematically identify and quantify the determinants of relative
effectiveness and sources of variation between populations and healthcare systems. We
consider how methods such as stochastic frontier analysis and data envelopment analysis
using a Malmquist productivity index could in principle be used to generate evidence on,
and improve understanding about, the sources of variation in relative effectiveness
between countries and over time.Results: Better evidence on factors driving relative effectiveness could:
inform decisions on how to best use a new technology to maximum effectiveness; establish
the need if any for follow-up post-launch studies, and provide evidence of the impact of
new health technologies on outcomes in different healthcare systems.Conclusions: The health production function approach for assessment of
relative effectiveness is complementary to traditional experimental and observational
studies, focusing on identifying, collecting, and analyzing data at the national level,
enabling comparisons to take place. There is a strong case for exploring the use of this
approach to better understand the impact of new medicines and devices for improvements in
health outcomes.