Lecture 1: Introduction to Health Economic Evaluation

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Lecture 1 Introduction to Health Economic
Evaluation

• Yot Teerawattananon, M.D., Ph.D.
• yot_at_ihpp.thaigov.net

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• Health economics how to make decisions based on
  scarcity of resources

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???? 10 ?? 10

• 1) ??? 30 ?? ?????????????????????????????? 20 ??
  100

3) ??? 2 ?? ?????????????????????? ??????????????
50/50
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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

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Economic evaluation
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What counts as an economic evaluation?
Often confusion with economic evaluation
Clinical studies or trials
Source Drummond et al 2005
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Type of economic evaluation
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To compare therapy A vs. therapy B
Cost (A) Outcome (A)
Cost (B) Outcome (B)
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Cost (A) - Cost (B) Outcome (A) - Outcome (B)
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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

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• 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
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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)

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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

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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

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Numbers of Thai economic evaluation publications,
international and domestic, 1982-2005
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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 200725(6)467-79.
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Sources of finance for economic evaluation
studies in Thailand
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Teerawattananon et al. A Systematic Review of
Economic Evaluation Literature in Thailand Are
the Data Good Enough to be Used by Policy-Makers?
Pharmacoeconomics 200725(6)467-79.
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Comparison of the proportion of overall disease
burden and the economic evaluation publications
in Thailand
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Teerawattananon et al. A Systematic Review of
Economic Evaluation Literature in Thailand Are
the Data Good Enough to be Used by Policy-Makers?
Pharmacoeconomics 200725(6)467-79.
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Economic evaluation of provider-initiated HIV
counseling and testing at health care settings in
Thailand

• Yot Teerawattananon M.D., Ph.D.

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Rationale

• Early detection for unknown HIV infection
• Individual to provide proper care, e.g.
  prophylaxis of opportunistic infections,
  antiretroviral treatment
• Population to prevent horizontal and /or
  vertical HIV transmission
• Provider-initiated voluntary HIV counselling
  testing (VCT)--no enough evidence on its
  effectiveness and value for money

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Approaches

• Effectiveness
• Cluster (pair-matched) randomised study ?
  acceptance rate of HIV testing and HIV infection
  detection rate
• Efficiency
• Economic evaluation (cost-effectiveness analysis)

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Scope of the study

• Settings community hospitals with low and high
  HIV prevalence
• Target population 13-64 year-old visiting OPD
• Intervention
• Information sheet
• 7-minute VDO for group counselling
• Anonymous system for HIV testing

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First randomization
Second randomization
MAP OF THAILAND
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Control period
Intervention period
NE
C
S
there were high- and low- HIV prevalence stratums
Aug 07
Dec 07
Oct 07
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Results
PPP USD international US dollar ICER
Incremental cost-effectiveness ratio
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Who Uses Economic Evidence?

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A 2007 survey amongst decision makers on the
potential use of economic evaluation in Thailand
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Chaikledkaew et al. A national survey on human
capacity for health technology assessment in
Thailand (a draft manuscript for submission to
international journal)
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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??

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CEA, CUA for allocative efficiency

• Tubular approach ? League tables
• 2) Threshold value approach

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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

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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
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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

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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

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PBACs threshold
Implicit threshold
Incremental cost/extra QALY gained
Evaluations
Source Towse and Pritchard, 2002
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Is there a NICEs threshold?
Source Towse and Pritchard, 2002
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Whats about Thailand? Cost-effectiveness league
table of selected interventions
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