Economic Aspects of Evaluation - Evaluation Methods in Biomedical Informatics - page 311

at a slightly higher level of detail, in which the costs of an entire depart-
ment (say radiology) are calculated based on what portion of the overall
hospital budget is attributable to the department (salaries, capital equip-
ment costs, overhead, etc.), and these costs compared to the total charges
for the product produced (billed) by that department. This global cost-to-
charge ratio is then applied to the charge for each individual product or
service produced by that department to estimate the cost of that item. More
detail regarding costing methodology is found in Drummond et al., 10
Chapter 4.
Macro-costing techniques use truly global measures of the costs (or pay-
ments) for services. For example, in the United States, the Centers for
Medicare and Medicaid Services (CMS) has calculated (through a very
complicated resource-based analysis) the estimated average cost for every
physician service from office visits to various procedures to the costs of hos-
pitalization for all categories of diagnoses. For hospitals, these are called
diagnostic related groups (DRGs). They not only represent what the federal
government will pay for particular services, but also are designed to repre-
sent the average true cost of that service or procedure. In the U.S., for indi-
vidual providers, CMS pays practitioners according to the Resource-Based
Relative Value Scale (RBRVS), which represents a complex calculation of
the education, training, difficulty, and risk of various services and proce-
dures. More information on cost analyses are available in Drummond et
al., 10 Chapter 4, Gold et al., 3 and at the NICE Web site.
Often, cost analyses do not need to be conducted at a level of detail that
requires knowledge of the costs of every component of a health care
provider or hospital's cost structure. This is especially true in determining
the costs of information systems, when the costs may be dictated by market
forces (a particular vendor sells a system for a particular price). Costs
savings (in terms of decreased need for personnel, changes in pharmaceu-
tical costs, changes in maintenance fees) can also often be calculated from
data derived from vendors, personnel files, and current hospital contracts.
However, if a portion of the costs or benefits are measured in changes in
the quantity of services, procedures, or clinical outcomes, a rigorous analy-
sis of the true cost of those components needs to be accomplished.
Definition and Measurement of Outcomes and Benefits
With the exception of studies in which the clinically important outcomes
are assumed to be equivalent, economic analyses in health care must have
a mechanism for measuring and quantifying the outcome of interest. One
of the most difficult aspects of this task is making sure that the various out-
comes are measured using the same metric, that is, that the units of mea-
surement for all possible choices or strategies are the same. The simplest
cases are those in which the mortality and morbidity outcomes of a partic-