Using cost-effectiveness/cost-benefit analysis to allocate health resources: a level playing field for prevention?

Important note: Information in this article was accurate in 1997. The state of the art may have changed since the publication date.

Using cost-effectiveness/cost-benefit analysis to allocate health resources: a level playing field for prevention?

Am J Prev Med. 1997 Jan-Feb;13(1):18-25. Unique Identifier : AIDSLINE MED/97189066
Phillips KA; Hotlgrave DR; Department of General Internal Medicine Institute for Health Policy; Studies, School of Medicine, University of California, San Francisco,; USA.

Abstract: INTRODUCTION: Prevention is being promoted as a means to improve health status and to save health care costs. Economic evaluations of prevention (i.e., cost-effectiveness and cost-benefit analyses) indicate that some prevention activities, like many treatments, do not save money, although many are relatively cost-effective. It has been suggested, however, that prevention is held to a higher standard than treatment because prevention programs are expected to demonstrate cost savings, and that the methods of economic evaluation understate the cost-effectiveness of prevention. Although the converse assertion is less commonly made, economic evaluations may also overstate the cost-effectiveness of prevention. The purpose of this article is to examine how the methods of economic evaluation may systematically understate, or overstate, the cost-effectiveness or net benefits) of prevention. METHODS: We examine three key methods: (1) how future costs and benefits are valued discounting"), (2) how costs and benefits to people beyond those who are the users of prevention are valued externalities"), and (3) how nonmonetary costs and benefits to individuals are valued ("intangibles"). RESULTS: We discuss several recommendations for each key method, and we use a hypothetical example of the cost-effectiveness of a vaccine to prevent human immunodeficiency virus (HIV) to illustrate our points. CONCLUSIONS: We conclude that the methods of economic evaluation may both understate and overstate the cost-effectiveness of prevention.

Keywords: *Cost-Benefit Analysis/METHODS *Health Care Rationing/ECONOMICS *Preventive Health Services/ECONOMICS
970730
M9772165

AEGiS is a 501(c)3, not-for-profit, tax-exempt, educational corporation. AEGiS is made possible through unrestricted funding from Boehringer Ingelheim, Bridgestone/Firestone Charitable Trust, Bristol-Myers Squibb Company, Elton John AIDS Foundation, Gill Foundation, the National Library of Medicine, Quest Diagnostics, Roche and Trimeris, and donations from users like you. Always watch for outdated information. This article first appeared in 1997. This material is designed to support, not replace, the relationship that exists between you and your doctor.

AEGiS presents published material, reprinted with permission and neither endorses nor opposes any material. All information contained on this website, including information relating to health conditions, products, and treatments, is for informational purposes only. It is often presented in summary or aggregate form. It is not meant to be a substitute for the advice provided by your own physician or other medical professionals. Always discuss treatment options with a doctor who specializes in treating HIV.

Copyright ©1980, 1997. AEGiS. All materials appearing on AEGiS are protected by copyright as a collective work or compilation under U.S. copyright and other laws and are the property of AEGiS, or the party credited as the provider of the content. .