Economic evaluation in obstetrics and gynaecology: principles and practice

Greater attention in health care over the last 2 decades has been placed on determining how best to spend the resources available. Economic evaluation is a commonly used tool to compare health-care services and treatments on the basis of costs and benefits. However, the principles on which economic evaluations are based are not well understood, and guidelines for conducting such evaluations in practice are often not followed. This paper describes the overarching principle of opportunity cost, and highlights the implication that decision-making in health care should necessarily be based on both costs and benefits. Two notions of efficiency, technical and allocative, are also presented, and the important point is made that the specific type of economic evaluation chosen must be based not on the unit of benefit in the given study, as is commonly done, but rather on the type of efficiency being addressed. The 3 primary types of economic evaluation are outlined, and a common pitfall in economic evaluation, the incremental cost-effectiveness ratio, is critiqued. Finally, a number of methodological considerations when conducting economic evaluations in practice are presented.