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Theories of Health Care Cost-Effectiveness Analysis


  • Ernst, Richard


The core of health care cost-effectiveness analysis is a set of decision rules for enabling public health care agencies to choose the most socially beneficial treatments to provide to or insure for their patient communities. Inappropriate versions of these rules are used by the national and provincial health services of the UK and several of the commonwealth countries, and they are also commonly used in published cost-effectiveness analyses. Here the correct decision rules are derived from standard utilitarian welfare premises and two different models of the optimizing behavior of a rational health care agency. The methods of probabilistic cost-effectiveness are discussed, and statistical tests are proposed for applying the decision rules under conditions of uncertainty.

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  • Ernst, Richard, 2017. "Theories of Health Care Cost-Effectiveness Analysis," SocArXiv gjbcp, Center for Open Science.
  • Handle: RePEc:osf:socarx:gjbcp
    DOI: 10.31219/

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    References listed on IDEAS

    1. Eugene M. Laska & Morris Meisner & Carole Siegel & Joseph Wanderling, 2002. "Statistical determination of cost‐effectiveness frontier based on net health benefits," Health Economics, John Wiley & Sons, Ltd., vol. 11(3), pages 249-264, April.
    2. Daniel Polsky & Henry A. Glick & Richard Willke & Kevin Schulman, 1997. "Confidence Intervals for Cost–Effectiveness Ratios: A Comparison of Four Methods," Health Economics, John Wiley & Sons, Ltd., vol. 6(3), pages 243-252, May.
    3. Elisabeth Fenwick & Karl Claxton & Mark Sculpher, 2001. "Representing uncertainty: the role of cost‐effectiveness acceptability curves," Health Economics, John Wiley & Sons, Ltd., vol. 10(8), pages 779-787, December.
    4. Michał Jakubczyk & Bogumił Kamiński, 2010. "Cost‐effectiveness acceptability curves – caveats quantified," Health Economics, John Wiley & Sons, Ltd., vol. 19(8), pages 955-963, August.
    5. Magnus Tambour & Niklas Zethraeus, 1998. "Bootstrap confidence intervals for cost‐effectiveness ratios: some simulation results," Health Economics, John Wiley & Sons, Ltd., vol. 7(2), pages 143-147, March.
    6. Gray, Alastair M. & Clarke, Philip M. & Wolstenholme, Jane L. & Wordsworth, Sarah, 2010. "Applied Methods of Cost-effectiveness Analysis in Healthcare," OUP Catalogue, Oxford University Press, number 9780199227280.
    7. Eugene M. Laska & Morris Meisner & Carole Siegel, 1997. "Statistical Inference for Cost–Effectiveness Ratios," Health Economics, John Wiley & Sons, Ltd., vol. 6(3), pages 229-242, May.
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