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Normative issues in cost effectiveness analysis

S D Goold1, S Vijan

  • 1Department of Internal Medicine, University of Michigan Medical Center, Ann Arbor 48109-0376, USA.

The Journal of Laboratory and Clinical Medicine
|November 21, 1998
PubMed
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Cost-effectiveness analysis (CEA) and cost-utility analysis guide health care resource allocation. Methodologic choices in CEA influence policy decisions, highlighting its value and limitations in resource allocation.

Area of Science:

  • Health economics
  • Health services research
  • Decision science

Background:

  • Cost-effectiveness analysis (CEA) and cost-utility analysis are vital tools for resource allocation in healthcare.
  • These analyses inform policy decisions across governmental, payer, and clinical health system levels.

Purpose of the Study:

  • To discuss methodologic choices in CEA and their normative assumptions.
  • To illustrate how these choices influence policy decisions using adult-onset diabetes treatment as a case example.

Main Methods:

  • Discussion of various methodological choices in CEA.
  • Case example: treatment of adult-onset diabetes.
  • Examination of perspective, cost inclusion/exclusion, and benefit measurement.
Keywords:
Health Care and Public Health

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Main Results:

  • Methodologic choices and value assumptions in CEA can implicitly shape policy outcomes.
  • The analysis demonstrates the impact of CEA on individuals and groups.

Conclusions:

  • CEA is a valuable information source for healthcare resource allocation.
  • CEA is not a "technologic fix" for complex resource allocation problems.