The Broader Opportunity Costs in the Broader Cost-Effectiveness Analysis Framework

Area of Science:

• Health Economics
• Decision Analysis
• Public Health Policy

Background:

• Traditional cost-effectiveness analysis (CEA) focuses narrowly on healthcare system budgets and population health.
• Extensions to CEA are needed to incorporate non-health sector impacts, broader outcomes, and equity considerations.
• Existing alternatives like the "impact inventory" and "beyond-the-QALY" offer partial solutions.

Purpose of the Study:

• To develop a comprehensive framework for cost-effectiveness analysis.
• To integrate key extensions of CEA, including non-health impacts and equity.
• To enable a unidimensional measure of cost-effectiveness results.

Main Methods:

• Building on prior research, a novel framework is proposed.
• The framework explicitly incorporates the full opportunity costs of including additional dimensions and distributional concerns.
• A hypothetical example illustrates the framework's application.

Main Results:

• Operationalizing the framework necessitates system-wide data on selected dimensions and their opportunity costs.
• Quantifying equity weights and the monetary valuation of non-monetary metrics are crucial.
• Estimates for beneficiaries and losers meeting equity considerations are required.

Conclusions:

• Extending CEA requires a broader measurement of opportunity costs for funding decisions.
• This endeavor presents significant conceptual and empirical challenges.
• Further research is proposed to address these challenges and facilitate framework implementation.