Health Economics Exam (Part 2)

Question 1

T/F: Economic evaluation is one input into the decision-making process

Answer 1

T
Other considerations
* Efficacy
* Effectiveness
* Safety
* Burden of Disease
* Equity
* Ethics
* Patient engagement * Budget (affordability)

Question 2

economic cost vs budget

Answer 2

A budget is comprised of financial costs (i.e. costs that will require a financial transaction)
* Economic costs are inclusive of ALL costs regardless of whether a financial transaction is involved
Economic costs =
Financial costs + Other opportunity costs

Other costs:
Productivity costs (i.e. opportunity costs), where applicable
o Opportunity costs of volunteer time o Opportunity costs of unpaid training o Lost productivity of clients/patients o Other relevant opportunity costs

Costs incurred/saved in other organizations and/or sectors o To other organizations
o Costs incurred by partner organizations to deliver the program (For example, if another organization donates space, the opportunity cost of the donated space can be estimated)
o Costs to the publicly funded health care payer (i.e. healthcare costs funded by the government that are reduced by the program)
o Cost savings in the publicly funded health care sector (For example, cost savings from reduced emergency department visits, reduced hospitalization, reduced need to access primary health care services)
o Costs to the government payer beyond health care (i.e. costs of social services or other government funded programs)
o Cost savings in other publicly financed sectors (for example, reduced policing costs, reduced social services costs)
Costs to clients/patients and informal caregivers
o Cost savings reducing out of pocket expenditures for clients/patients and families

Question 3

productivity costs

Answer 3

Productivity costs (or time costs) of patients/clients, unpaid caregivers (volunteers, family members), unpaid healthcare workers (i.e. volunteers)
– Value of lost or impaired ability to do work, due to… *Poor health
*Time spent accessing health services
–Visiting a clinician’s office –Visiting the public health unit –Length of stay in hospital
*Time spent in transportation
– Value of lost leisure for patients/clients, unpaid caregivers and/or volunteers (controversial)

Question 4

cost analysis overview

Answer 4

• Step 1: Identification of resources
  – Identify cost items

Dependsondecisionproblem,alternatives,timehorizon,categories,perspective
* Step 2: Measurement of resource use (q) – Model-basedestimation
– Clinicaltrialsorotherprospectivestudies – Retrospectivereviewofdata
* Step 3: Valuation of resources (p) – Costversusprice
– Productivitycosts
– Discounting
– Inflation
– PurchasingPowerParityconversion(timepermitting)
* Step 4: Perform cost analysis (p x q)

Question 5

cost categories

Answer 5

Costs to:
1) Organization
2) Publicly funded healthcare payer
3) Private insurers
4) Government payer beyond healthcare
5) Costs to client/caregivers
6) Productivity costs

Question 6

for measurement of resource use (q) we can use:

Answer 6

model-based estimation or within-trial data collection

Question 7

allocation of overhead

Answer 7

simple vs complex

Question 8

simple allocation for administrative and other staff

Answer 8

Hourly wage rate x Number of hours allocated to the program
– Full time equivalent (F.T.E) x Annual salary

Question 9

Simple allocation for utilities, housekeeping

Answer 9

square metres of space required by the program x per square metre cost, which represents
* Utilities(heat,electricity)
* Housekeeping

Question 10

capital should be allocated according to _____.

Answer 10

usage

For example, a shared vehicle should be allocated according to the expected mileage

Question 11

For the valuation of resources, we have market and non market items. For market items use the _______ price.

For non market items, these include ______.

Answer 11

market

items with no financial transaction involved (i.e., lost productivity of patients/clients, caregivers, volunteer time, unpaid training time, leisure time, non-market time)

Question 12

To determine opportunity cost related to non-market time, use

Answer 12

shadow price

Question 13

Discounting is a decision making tool that quantifies

Answer 13

societal time preference

Question 14

discount rate quantifies

Answer 14

rate of time preference

Question 15

apply discount rate to calculate present value of

Answer 15

A cost that will be incurred in the future or
A benefit that will be realized in the future