Economic Aspects of Evaluation - Evaluation Methods in Biomedical Informatics - page 303

FIGURE 11.1. Basic structure of an economic analysis. In general, all types of eco-
nomic analyses follow this structure. A new program or strategy that can be intro-
duced to replace an existing strategy produces a stream of costs and outcomes that
are different from the stream of costs and outcomes produced by the alternative.
CIS, clinical information system.
the costs required to achieve a given change in outcomes. It is important to
emphasize that economic analyses can rarely if ever indicate the “correct”
choice; they can only provide estimates of the likely economic and clinical
consequences of various choices. Whether a particular outcome gain is
worth the costs involves political, ethical, and other concerns that are spe-
cific to the situation.
There has been recent increasing interest, both in the United States and
abroad, in the development of formal, consistent standards for the conduct
of economic analyses in health care. In the United States, prompted by the
realization that economic analyses were quite variable and had differing
adherence to even minimal standards of analysis and reporting, 2 the Public
Health Service commissioned the Panel on Cost Effectiveness in Health
and Medicine, which consisted of experts who developed a series of re-
commendations regarding the conduct of cost-effectiveness analyses in
health care. 3 Their recommendations, although not entirely complete, have
become the de facto standards for conducting, analyzing, and reporting
cost-effectiveness analyses in the United States. In the United Kingdom, a
similar effort and structure has been put forward by the National Institute
for Clinical Excellence (NICE), which carries out cost-effectiveness studies
on novel medical technologies using a procedures manual published on its
Web site: www.nice.org.uk. Over the past 5 years the NICE organization
has completed dozens of effectiveness and cost-effectiveness analysis of
medical procedures, which are used in coverage and reimbursement decisions
by the U.K. National Health Service and other services around the world.
Types of Cost Studies
There are several types of economic evaluation that are used to compare
the effects of different choices and options in a health care setting. Table
11.1 provides a brief description of the various types of analysis and how
they differ in terms of the measure of outcomes. The characteristic that dif-
ferentiates most economic analyses is the metric used to evaluate the ben-