Case 3: Economic evaluation of health interventions
Learning goals
1. Why do we need to conduct economic evaluation of healthcare innovations?
2. What is an economic evaluation and what are the types of economic evaluations?
3. How do we present and interpret the results of an economic evaluation?
4. Describe the two main methods of economic evaluation (i.e., model-based and trial-based
economic evaluation)
a. What are the pros and cons of each method?
Keywords of the case
Cost benefit analysis, cost-effectiveness analysis, cost-minimisation analysis, cost-utility analysis,
cost-effectiveness plane, economic evaluation, model-based economic evaluation, trial-based
economic evaluation, QALY, incremental cost-effectiveness ratio and cost-effectiveness thresholds.
Literature
- Chisholm D, Evans D. Economic evaluation in health: saving money or improving care? Journal of
Medical Economics 2007; 10: 325–337
- Drummond M, Sculpher M, Claxton K, Stoddart G, Torrance G. Methods for the economic
evaluation of health care programmes. 2015. Fourth edition. Oxford. Chapter 1 and Chapter 4 (until
4.3.2 included)
- Evers, S. M., Goossens, M. E., Ament, A. J., & Maarse, J. A. (2001). Economic evaluation in stroke
research. An introduction. Cerebrovasc Dis, 11(2), 82-91.
- Kernick DP. Introduction to health economics for the medical practitioner. Postgrad Med J. 2003
Mar;79(929):147-50.
- Petrou S, Gray A. Economic evaluation alongside randomised controlled trials: design, conduct,
analysis, and reporting. BMJ. 2011 Apr 7;342:d1548.
- Petrou S, Gray A. Economic evaluation using decision analytical modelling: design, conduct, analysis,
and reporting. BMJ. 2011 Apr 11;342:d1766
- Sculpher MJ, Claxton K, Drummond M, McCabe C. Whither trial-based economic evaluation for
health care decision making? Health-Econ. 2006 Jul; 15(7): 677-87
,1. Why do we need to conduct economic evaluation of healthcare innovations?
Importance of economic evaluations
There is a tension between:
- Limited financial possibilities
à Healthcare budget constraint
- Unlimited needs/ Increase of healthcare needs (costs)
à New expensive treatments/ interventions/ innovations
There are not enough resources to meet all of society’s needs and therefore, choices have to be
made.
Importance of health economic evaluation
- Increased attention to issues of costs and efficiency
- Increased use of economic data in decision about the reimbursement or pricing of health
technologies
- Formal use of economic data (e.g., drug reimbursement)
à Fourth hurdle to market access
Goal of decision makers
- To efficiently allocate scarce healthcare resources
- To maximise health of the population with limited resources
Health Technology Assessment
“HTA is a multidisciplinary process that summarizes information about the medical, social, economic,
and ethical issues related to the use of health technology in a systematic, transparent, unbiased,
robust manner” (European Commission). Its aims are:
- To inform decision making
- To improve the quality of care by promoting an appropriate and rational use of health
technologies
- To facilitate planning for the introduction and diffusion of new technologies
Economic evaluation
An economic evaluation is a branch of HTA, as for instance epidemiological, judicial, ethical and
social aspects. Economic evaluation looks at the costs and effects of (new) interventions.
à Provide a framework for identifying and comparing the costs and benefits of different options.
à Inform decision makers about efficient healthcare allocation
, Uncertainty in economic evaluation
- Structural uncertainty (assumptions, methods)
- Parameter uncertainty (e.g., treatment effect)
- Heterogeneity (sex, age, subgroups)
Because this still needs to be addressed, a sensitivity analysis can be performed (one-way vs.
probabilistic)
Key payer requirements
Criteria used to assess medicinal products
Learning goals
1. Why do we need to conduct economic evaluation of healthcare innovations?
2. What is an economic evaluation and what are the types of economic evaluations?
3. How do we present and interpret the results of an economic evaluation?
4. Describe the two main methods of economic evaluation (i.e., model-based and trial-based
economic evaluation)
a. What are the pros and cons of each method?
Keywords of the case
Cost benefit analysis, cost-effectiveness analysis, cost-minimisation analysis, cost-utility analysis,
cost-effectiveness plane, economic evaluation, model-based economic evaluation, trial-based
economic evaluation, QALY, incremental cost-effectiveness ratio and cost-effectiveness thresholds.
Literature
- Chisholm D, Evans D. Economic evaluation in health: saving money or improving care? Journal of
Medical Economics 2007; 10: 325–337
- Drummond M, Sculpher M, Claxton K, Stoddart G, Torrance G. Methods for the economic
evaluation of health care programmes. 2015. Fourth edition. Oxford. Chapter 1 and Chapter 4 (until
4.3.2 included)
- Evers, S. M., Goossens, M. E., Ament, A. J., & Maarse, J. A. (2001). Economic evaluation in stroke
research. An introduction. Cerebrovasc Dis, 11(2), 82-91.
- Kernick DP. Introduction to health economics for the medical practitioner. Postgrad Med J. 2003
Mar;79(929):147-50.
- Petrou S, Gray A. Economic evaluation alongside randomised controlled trials: design, conduct,
analysis, and reporting. BMJ. 2011 Apr 7;342:d1548.
- Petrou S, Gray A. Economic evaluation using decision analytical modelling: design, conduct, analysis,
and reporting. BMJ. 2011 Apr 11;342:d1766
- Sculpher MJ, Claxton K, Drummond M, McCabe C. Whither trial-based economic evaluation for
health care decision making? Health-Econ. 2006 Jul; 15(7): 677-87
,1. Why do we need to conduct economic evaluation of healthcare innovations?
Importance of economic evaluations
There is a tension between:
- Limited financial possibilities
à Healthcare budget constraint
- Unlimited needs/ Increase of healthcare needs (costs)
à New expensive treatments/ interventions/ innovations
There are not enough resources to meet all of society’s needs and therefore, choices have to be
made.
Importance of health economic evaluation
- Increased attention to issues of costs and efficiency
- Increased use of economic data in decision about the reimbursement or pricing of health
technologies
- Formal use of economic data (e.g., drug reimbursement)
à Fourth hurdle to market access
Goal of decision makers
- To efficiently allocate scarce healthcare resources
- To maximise health of the population with limited resources
Health Technology Assessment
“HTA is a multidisciplinary process that summarizes information about the medical, social, economic,
and ethical issues related to the use of health technology in a systematic, transparent, unbiased,
robust manner” (European Commission). Its aims are:
- To inform decision making
- To improve the quality of care by promoting an appropriate and rational use of health
technologies
- To facilitate planning for the introduction and diffusion of new technologies
Economic evaluation
An economic evaluation is a branch of HTA, as for instance epidemiological, judicial, ethical and
social aspects. Economic evaluation looks at the costs and effects of (new) interventions.
à Provide a framework for identifying and comparing the costs and benefits of different options.
à Inform decision makers about efficient healthcare allocation
, Uncertainty in economic evaluation
- Structural uncertainty (assumptions, methods)
- Parameter uncertainty (e.g., treatment effect)
- Heterogeneity (sex, age, subgroups)
Because this still needs to be addressed, a sensitivity analysis can be performed (one-way vs.
probabilistic)
Key payer requirements
Criteria used to assess medicinal products
