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Budgetary policies and available actions: a generalisation of decision rules for allocation and research decisions

Author

Listed:
  • Claire McKenna

    (Centre for Health Economics, University of York, UK)

  • Zaid Chalabi

    (Department of Public Health and Policy, London School of Hygiene and Tropical Medicine, London, UK)

  • David Epstein

    (Centre for Health Economics, University of York, UK)

  • Karl Claxton

    (Centre for Health Economics, University of York, UK)

Abstract

The allocation problem in health care can be characterised as a mathematical programming problem but attempts to incorporate uncertainty in costs and effect have suffered from important limitations. A two stage stochastic mathematical programming formulation is developed and applied to a numerical example to explore and demonstrate the implications of this more general and comprehensive approach. The solution to the allocation problem for different budgets, budgetary policies, and available actions are then demonstrated. This analysis is used to evaluate different budgetary policies and examine the adequacy of standard decision rules in cost-effectiveness analysis. The research decision is then considered alongside the allocation problem. This more general formulation demonstrates that the value of further research depends on: i) the budgetary policy in place; ii) the realisations revealed during the budget period; iii) remedial actions that may be available; and iv) variability in parameters values.

Suggested Citation

  • Claire McKenna & Zaid Chalabi & David Epstein & Karl Claxton, 2008. "Budgetary policies and available actions: a generalisation of decision rules for allocation and research decisions," Working Papers 044cherp, Centre for Health Economics, University of York.
    • Handle: RePEc:chy:respap:44cherp
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    Cited by:

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    3. Michael Fairley & Lauren E. Cipriano & Jeremy D. Goldhaber-Fiebert, 2020. "Optimal Allocation of Research Funds under a Budget Constraint," Medical Decision Making, , vol. 40(6), pages 797-814, August.
    4. Lahav, Yael & Herbon, Avi & Spiegel, Uriel, 2023. "The cost-benefit approach to an optimal charging scheme for an embryo storage service," Operations Research Perspectives, Elsevier, vol. 10(C).
    5. Paul Revill & Simon Walker & Valentina Cambiano & Andrew Phillips & Mark J Sculpher, 2018. "Reflecting the real value of health care resources in modelling and cost-effectiveness studies—The example of viral load informed differentiated care," PLOS ONE, Public Library of Science, vol. 13(1), pages 1-13, January.
    6. H. Koffijberg & G. A. de Wit & T. L. Feenstra, 2012. "Communicating Uncertainty in Economic Evaluations," Medical Decision Making, , vol. 32(3), pages 477-487, May.
    7. Tom L. Drake & Yoel Lubell & Shwe Sin Kyaw & Angela Devine & Myat Phone Kyaw & Nicholas P. J. Day & Frank M. Smithuis & Lisa J. White, 2017. "Geographic Resource Allocation Based on Cost Effectiveness: An Application to Malaria Policy," Applied Health Economics and Health Policy, Springer, vol. 15(3), pages 299-306, June.
    8. Claire McKenna & Karl Claxton, 2011. "Addressing Adoption and Research Design Decisions Simultaneously," Medical Decision Making, , vol. 31(6), pages 853-865, November.
    9. Kurth, Margaret & Keisler, Jeffrey M. & Bates, Matthew E. & Bridges, Todd S. & Summers, Jeffrey & Linkov, Igor, 2017. "A portfolio decision analysis approach to support energy research and development resource allocation," Energy Policy, Elsevier, vol. 105(C), pages 128-135.
    10. Nadia Demarteau & Thomas Breuer & Baudouin Standaert, 2012. "Selecting a Mix of Prevention Strategies against Cervical Cancer for Maximum Efficiency with an Optimization Program," PharmacoEconomics, Springer, vol. 30(4), pages 337-353, April.

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