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Lecture 1: Introduction to Health Economic Evaluation. Yot Teerawattananon, M.D., Ph.D. yot@ihpp.thaigov.net. Health economics: how to make decisions based on scarcity of resources. 2. ท่านเลือกช่วยใคร ?. 1) เอก 30 ปี ยาต้านไวรัสช่วยให้มีอายุยืนยาว 20 ปี 100%.

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lecture 1 introduction to health economic evaluation

Lecture 1: Introduction to Health Economic Evaluation

Yot Teerawattananon, M.D., Ph.D.

yot@ihpp.thaigov.net

slide3
ท่านเลือกช่วยใคร?

1) เอก 30 ปียาต้านไวรัสช่วยให้มีอายุยืนยาว 20 ปี 100%

2) ชูใจ 40 ปีแม่ของน้องเดชอายุ 5 ปี โรคมะเร็งปากมดลูก ยาใหม่โอกาสรอด เกิน 5 ปี 80% เกิน 10 ปี 10%

3) ปอง 2 ปีโรคหัวใจพิการแต่กำเนิด ผ่าตัดโอกาสรอด 50/50

3

john stuart mills
John Stuart Mills

Utilitarianism

  • Happiness was the greatest goods
  • Happiness and unhappiness can be measured in discrete units and calculated mathematically e.g. sum of happiness, subtracting the pain
  • The goal is the production of maximal happiness, or utility

4

what counts as an economic evaluation
What counts as an “economic” evaluation?

Often confusion with economic evaluation

Clinical studies or trials

Source: Drummond et al 2005

6

to compare therapy a vs therapy b
To compare therapy A vs. therapy B

Cost (A)

Outcome (A)

Cost (B)

Outcome (B)

1

Cost (A) - Cost (B)

Outcome (A) - Outcome (B)

2

the need for incremental thinking
The need for incremental thinking

Marginal analysis: requires assessment of relative costs and benefits of each marginal addition or reduction in production/consumption

1975 article from Neuhauser and Levicky: “what do we gain from the sixth stool-guaic” (N Engl J Med) on stool tests do detect colonic cancer

9

slide11

D

A

C

  • Cost-effectiveness plane

more costly

B

Intervention is more

effective and more costly

Intervention is less

effective and more costly

decrease in health effects

increase in health effects

Intervention is more

effective and less costly

Intervention is less

effective and less costly

less costly

11

key elements major recommendations
Key elements & major recommendations

Defining the scope of the study and selection of comparator(s)

Defining the type of evaluation

“comparators”: common practice, the most effective, known cost-effective, the least expensive

Cost-utility analysis (Baht/QALY)

12

key elements major recommendations1
Key elements & major recommendations

Measuring of costs

Measuring clinical effects

Societal perspective and include opportunity cost

Using local data

Systematic review and meta-analysis of RCT

Clinical endpoints, not surrogate outcomes

Modelling is allowed

13

key elements major recommendations2
Key elements & major recommendations

Handling time

Handling uncertainty

Long enough to capture the full costs and effects of the interventions

3% discount rate

Mandatory requirement

Probabilistic sensitivity analysis

14

numbers of thai economic evaluation publications international and domestic 1982 2005
Numbers of Thai economic evaluation publications, international and domestic, 1982-2005

15

slide16
Extent to which the published economic evaluations set in Thailand met the standard recommendations for good reporting

Teerawattananon et al. A Systematic Review of Economic Evaluation Literature in Thailand: Are the Data Good Enough to be Used by Policy-Makers? Pharmacoeconomics 2007;25(6):467-79.

16

sources of finance for economic evaluation studies in thailand
Sources of finance for economic evaluation studies in Thailand

17

Teerawattananon et al. A Systematic Review of Economic Evaluation Literature in Thailand: Are the Data Good Enough to be Used by Policy-Makers? Pharmacoeconomics 2007;25(6):467-79.

slide18
Comparison of the proportion of overall disease burden and the economic evaluation publications in Thailand

18

Teerawattananon et al. A Systematic Review of Economic Evaluation Literature in Thailand: Are the Data Good Enough to be Used by Policy-Makers? Pharmacoeconomics 2007;25(6):467-79.

a 2007 survey amongst decision makers on the potential use of economic evaluation in thailand
A 2007 survey amongst decision makers on the potential use of economic evaluation in Thailand

27

Chaikledkaew et al. A national survey on human capacity for health technology assessment in Thailand (a draft manuscript for submissionto international journal)

how make decisions based on health economic evaluation results
How make decisions based on health economic evaluation results?
  • Technical efficiency
    • cheapest option CMA
    • Lowest incremental cost-effectiveness ratio CEA, CUA
  • Allocative efficiency
    • cost savings exceed the cost of the interventionCBA
    • CEA, CUA??
cea cua for allocative efficiency
CEA, CUA for allocative efficiency
  • Tubular approach  League tables
  • 2) Threshold value approach
tubular approach league tables
Tubular approach (League tables)
  • Ideal for maximizing health benefit  selecting programs to be adopted in sequence from the top down until a line where the budget is exhausted
  • familiar to decision makers & general population
slide25

Budget

10,000

20,000

15,000

35,000

10,000

15,000

20,000

5,000

10,000

10,000

10,000

10,000

Limited budget = 100,000

disadvantage of league tables
Disadvantage of league tables
  • Enormous work of analysis of possible options
  • Review  methodology differences e.g.perspective used, time-horizon, comparator(s), discount rate, type of cost and outcome estimation
  • Usually, not taking into account about uncertainty
threshold approach
Threshold approach
  • Originated by Weinstein & Zeckhauser 1973  the need of consistency decisions
    • determine the maximum price that society is willing to pay for unit of health effects
  • Level of cost and effects that an interventions must achieve to be acceptable for in a given healthcare system
  • Threshold may be implicit or explicit
pbac s threshold
PBAC’s threshold

Implicit threshold

Incremental cost/extra QALY gained

Evaluations

Source: Towse and Pritchard, 2002

is there a nice s threshold
Is there a NICE’s threshold?

Source: Towse and Pritchard, 2002