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Confidence Intervals for Cost-Effectiveness Ratios: A Comparison of Four Methods

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Author Info
Daniel Polsky (Division of General Internal Medicine and Leonard Davis Institute of Health Economics, University of Pennsylvania, USA)
Henry A. Glick (Division of General Internal Medicine and Leonard Davis Institute of Health Economics, University of Pennsylvania, USA)
Richard Willke (Pharmacia and Upjohn, Inc., Kalamazoo, USA)
Kevin Schulman (Clinical Economics Research Unit, Division of General Internal Medicine, Georgetown University Medical Center, Washington, DC, USA)
Abstract

We evaluated four methods for computing confidence intervals for cost-effectiveness ratios developed from randomized controlled trials: the box method, the Taylor series method, the nonparametric bootstrap method and the Fieller theorem method. We performed a Monte Carlo experiment to compare these methods. We investigated the relative performance of each method and assessed whether or not it was affected by differing distributions of costs (normal and log normal) and effects (10% absolute difference in mortality resulting from mortality rates of 25% versus 15% in the two groups as well as from mortality rates of 55% versus 45%) or by differing levels of correlation between the costs and effects (correlations of −0.50, −0.25, 0.0, 0.25 and 0.50). The principal criterion used to evaluate the performance of the methods was the probability of miscoverage. Symmetrical miscoverage of the intervals was used as a secondary criterion for evaluating the four methods.

Overall probabilities of miscoverage for the nonparametric bootstrap method and the Fieller theorem method were more accurate than those for the other the methods. The Taylor series method had confidence intervals that asymmetrically underestimated the upper limit of the interval. Confidence intervals for cost-effectiveness ratios resulting from the nonparametric bootstrap method and the Fieller theorem method were more dependably accurate than those estimated using the Taylor series or box methods. Routine reporting of these intervals will allow individuals using cost-effectiveness ratios to make clinical and policy judgments to better identify when an intervention is a good value for its cost. © 1997 by John Wiley & Sons, Ltd.

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Publisher Info
Article provided by John Wiley & Sons, Ltd. in its journal Health Economics.

Volume (Year): 6 (1997)
Issue (Month): 3 ()
Pages: 243-252
Download reference. The following formats are available: HTML (with abstract), plain text (with abstract), BibTeX, RIS (EndNote, RefMan, ProCite), ReDIF
Handle: RePEc:wly:hlthec:v:6:y:1997:i:3:p:243-252

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Web page: http://www3.interscience.wiley.com/cgi-bin/jhome/5749

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  1. Daniel F. Heitjan, 2000. "Fieller's method and net health benefits," Health Economics, John Wiley & Sons, Ltd., vol. 9(4), pages 327-335.
  2. Simon Eckermann & Andrew R. Willan, 2009. "Globally optimal trial design for local decision making," Health Economics, John Wiley & Sons, Ltd., vol. 18(2), pages 203-216. [Downloadable!]
  3. Elamin H. Elbasha, 2005. "Risk aversion and uncertainty in cost-effectiveness analysis: the expected-utility, moment-generating function approach," Health Economics, John Wiley & Sons, Ltd., vol. 14(5), pages 457-470. [Downloadable!]
  4. Martin W. McIntosh & Scott D. Ramsey & Kristin Berry & Nicole Urban, 2001. "Parameter solicitation for planning cost effectiveness studies with dichotomous outcomes," Health Economics, John Wiley & Sons, Ltd., vol. 10(1), pages 53-66.
  5. Andrew R. Willan & Andrew H. Briggs & Jeffrey S. Hoch, 2004. "Regression methods for covariate adjustment and subgroup analysis for non-censored cost-effectiveness data," Health Economics, John Wiley & Sons, Ltd., vol. 13(5), pages 461-475. [Downloadable!]
  6. Raymond C. W. Hutubessy & Louis W. Niessen & Rob F. Dijkstra & Ton F. Casparie & Frans F. Rutten, 2005. "Stochastic league tables: an application to diabetes interventions in the Netherlands," Health Economics, John Wiley & Sons, Ltd., vol. 14(5), pages 445-455. [Downloadable!]
  7. Joseph C. Gardiner & Marianne Huebner & James Jetton & Cathy J. Bradley, 2000. "Power and sample assessments for tests of hypotheses on cost-effectiveness ratios," Health Economics, John Wiley & Sons, Ltd., vol. 9(3), pages 227-234.
  8. Murillo Fort, Carles & González López-Valcárcel, Beatriz, 2006. "Potencialidades Y Limitaciones De Las Ligas De Calidad De Los Proveedores Sanitarios/Quality Ranking Of Health Care Providers: Potential And Limitations," Estudios de Economía Aplicada, Estudios de Economía Aplicada, vol. 24, pages 777-788, Diciembre. [Downloadable!] (restricted)
  9. Andrea Manca & Neil Hawkins & Mark J. Sculpher, 2005. "Estimating mean QALYs in trial-based cost-effectiveness analysis: the importance of controlling for baseline utility," Health Economics, John Wiley & Sons, Ltd., vol. 14(5), pages 487-496. [Downloadable!]
  10. Stephen Palmer & Peter Smith, 1999. "Incorporating option values into the economic evaluation of health care technologies," Working Papers 166chedp, Centre for Health Economics, University of York. [Downloadable!]
  11. Jeffrey S. Hoch & Andrew H. Briggs & Andrew R. Willan, 2002. "Something old, something new, something borrowed, something blue: a framework for the marriage of health econometrics and cost-effectiveness analysis," Health Economics, John Wiley & Sons, Ltd., vol. 11(5), pages 415-430. [Downloadable!]
  12. F. J. Vázquez-Polo & M. A. Negrín Hernández & B. González López-Valcárcel, 2005. "Using covariates to reduce uncertainty in the economic evaluation of clinical trial data," Health Economics, John Wiley & Sons, Ltd., vol. 14(6), pages 545-557. [Downloadable!]
  13. P. Sendi & A. Gafni & S. Birch, 2002. "Opportunity costs and uncertainty in the economic evaluation of health care interventions," Health Economics, John Wiley & Sons, Ltd., vol. 11(1), pages 23-31. [Downloadable!]
  14. Andrew R. Willan & Bernie J. O'Brien, 1999. "Sample size and power issues in estimating incremental cost-effectiveness ratios from clinical trials data," Health Economics, John Wiley & Sons, Ltd., vol. 8(3), pages 203-211.
  15. Daniel F. Heitjan & Huiling Li, 2004. "Bayesian estimation of cost-effectiveness: an importance-sampling approach," Health Economics, John Wiley & Sons, Ltd., vol. 13(2), pages 191-198. [Downloadable!]
  16. J. G. Hirschberg, J. N. Lye & D. J. Slottje, 2008. "Confidence Intervals for Estimates of Elasticities," Department of Economics - Working Papers Series 1053, The University of Melbourne. [Downloadable!]
  17. Daniel F. Heitjan & Alan J. Moskowitz & William Whang, 1999. "Bayesian estimation of cost-effectiveness ratios from clinical trials," Health Economics, John Wiley & Sons, Ltd., vol. 8(3), pages 191-201.
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