Lecture 9: Introduction to health Economics Flashcards
(37 cards)
What is healthcare economics the study of?
how choices in health and healthcare should be made between competing needs for resources
What are the four key concepts of economics?
1) opportunity cost
2) efficiency
3) marginal analysis
4) equity
What is opportunity cost?
the value of forgone benefit which could be obtained from a resource in its next best alternative use
What is efficiency in economics?
maximising the benefit for the resources used
What is technical efficiency?
meeting a given objective at the least cost (when comparing alternatives with similar outcomes)
What is allocative efficiency?
a situation in which consumers are all paying the lowest prices possible and all the producers capable of supplying at that price are doing so
What is marginal analysis?
analysis that involves comparing marginal benefits (next step up or down) and marginal costs
What is marginal benefit?
what you gain by adding or subtracting one more unit
What is marginal cost?
the cost of adding or subtracting one unit
What is equity (in economics)?
fairness or justice of the distributions of costs and benefits
What is cost-consequence analysis?
disaggregated study that looks at consequences measured in a variety of natural units (e.g. days of extra life) paired with their costs
Give 3 pros of cost-consequence analysis:
1) can see all outcomes
2) in natural terms
3) disaggregated (few assumptions)
Give 2 cons of cost-consequence analysis:
1) assumes decision maker capacity
2) no indication of relative importance of outcomes
Cost-effectiveness analysis:
compares the relative cost and outcomes of different courses of action (results are in terms of cost per unit effect e.g. £1K per life saved
Give two instances where cost-effectiveness analysis should not be used:
1) health programmes can have multiple objectives
2) health programmes may not have a main outcome
True or false: cost-effective analyses look at one clinical outcome (no secondary outcomes)
True
What is cost-minimisation analysis?
Chooses cheapest option between treatments that have identical outcomes
What is cost-benefit analysis?
a systemic process for calculating and comparing benefits and costs of an intervention in terms of monetary unit
True or false: cost-benefit analysis cannot be used for comparisons with other public sector expenditure
True
What is cost utility analysis?
Specialized form of cost-effectiveness analysis that includes a quality of life component associated with morbidity using common health indices such as quality-adjusted life (QALYs) and disability-adjusted life years (DALYs)
Give two instances where cost utility would not be used:
1) when an effectiveness measure is already captured by another variable
2) when effectiveness shows a programme has dominance
What NICE-approved standardised questionnaire is used to calculate QALY?
EQ-5D
What are the 5 factors assessed in the EQ-5D questionnaire?
1) mobility
2) selfcare
3) usual activity
4) pain/ discomfort
5) anxiety/ depression
(each is given a level from 1-3 with 1 being no problems and 3 being extreme problems)
What does a QALY score of 1 mean?
full year of quality life
