Using Cost-Effectiveness Analysis to Address Health Equity Concerns

Abstract

This articles serves as a guide to using cost-effectiveness analysis (CEA) to address health equity concerns. We first introduce the "equity impact plane," a tool for considering trade-offs between improving total health—the objective underpinning conventional CEA—and equity objectives, such as reducing social inequality in health or prioritizing the severely ill. Improving total health may clash with reducing social inequality in health, for example, when effective delivery of services to disadvantaged communities requires additional costs. Who gains and who loses from a cost-increasing health program depends on differences among people in terms of health risks, uptake, quality, adherence, capacity to benefit, and—crucially—who bears the opportunity costs of diverting scarce resources from other uses. We describe two main ways of using CEA to address health equity concerns: 1) equity impact analysis, which quantifies the distribution of costs and effects by equity-relevant variables, such as socioeconomic status, location, ethnicity, sex, and severity of illness; and 2) equity trade-off analysis, which quantifies trade-offs between improving total health and other equity objectives. One way to analyze equity trade-offs is to count the cost of fairer but less cost-effective options in terms of health forgone. Another method is to explore how much concern for equity is required to choose fairer but less cost-effective options using equity weights or parameters. We hope this article will help the health technology assessment community navigate the practical options now available for conducting equity-informative CEA that gives policymakers a better understanding of equity impacts and trade-offs.

E‐learning and health inequality aversion: A questionnaire experiment

“…One strand of this literature in the health field has investigated health inequality aversion, that is, social attitudes towards trade-offs between improving sum total health and reducing socioeconomic inequality in health (Abasolo & Tsuchiya, 2004;Ali, Tsuchiya, Asaria, & Cookson, 2017;Cropper, Krupnick, & Raich, 2016;Dolan & Tsuchiya, 2011;Edlin, Tsuchiya, & Dolan, 2012;Robson, Asaria, Cookson, Tsuchiya, & Ali, 2016), in the context of a wider literature on equity and the economic evaluation of health programs (Baker et al, 2010;Cookson, Griffin, & Nord, 2014;Cookson et al, 2017;Donaldson et al, 2011;Lancsar, Wildman, Donaldson, Ryan, & Baker, 2011). In these studies, health inequality aversion can be quantified using a parameter in a social welfare function.…”

Methods for public health economic evaluation: A Delphi survey of decision makers in English and Welsh local government

“…For taking account of inequalities, the Delphi panel obtained moderate agreement that economic evaluation should not focus exclusively on maximizing outcome or on minimizing inequality and should take a more balanced approach. This is interesting as distributional consequences are not often formally considered within economic evaluations for health technology assessment (McCabe, ) although some methodological advances for inclusion of equity effects have been made over recent years (Cookson et al, ). When asked about the methods for how economic evaluation should consider distributional effects, the panel was in high agreement for a formal weighting of outcomes by population subgroup; however, there was a cautionary note revealed by one participant who felt the weighting needs to be flexible and transparent: “perhaps the tools could suggest a weighting based on consensus and also allow the user to vary this to their local setting.”…”

Should health technology assessment be more patient centric? If so, how?

“…Even more controversially, treatments for patients with rare conditions may be more expensive to treat, so offering equal opportunity for care to these patients would have a substantial budgetary impact and consequent restrictions of care to other patients if the budget is fixed [22]. Clearly, there are a number of considerations in these cases, but there is a growing literature on how efficiency-equity choices could be addressed in conducting economic evaluations as part of HTA [23].…”