Introduction
Cost-effectiveness analysis (CEA) is a form of economic analysis that compares the relative costs and outcomes/effects of two or more scenarios. The CEA is typically expressed as a ratio, where the denominator is a gain in health using a natural unit of measurement (years of life, cases of flu prevented, etc.) and the numerator is the cost associated with that health gain.
Most clinical studies express gains in health in terms of disease-specific measures, such as number of heart attacks avoided or cases of influenza prevented. Although this is useful for particular treatments related to those health conditions, those measures do not allow for comparison across diseases. To solve this, the concept of quality-adjusted life years
The National Health Service (NHS) provides preventive medicine, primary care, and hospital services, and UK residents can use NHS health care for essentially nothing except for some co-payments for prescriptions and dental care. Alternatively, the national programs in the US are Medicare, Medicaid, and programs that cover military veterans and federal government employees. A large proportion of people have private insurance through their employer. While some private insurers in the US have imposed CEA rules, cost per QALY is a mandated decision-making tool concerning coverage and reimbursement in the
In the past CEA has shown that it should have a place in our discourse, such as showing that prevention programs typically do not produce cost savings and that high-tech interventions can provide good value for the money spent (Neumann, 2004).
CEA proponents believe that the country’s increased health care spending and desire for the best in medical technology will eventually force us to strongly consider using CEA as a possible solution to our problems. Perhaps a middle ground would be to use CEA as one tool of many when it comes to health policymaking. It does provide a tool to inform decision making in a clear, explicit way. In addition to the many countries that use CEA, medical journals here in the US routinely publish them. CEA would be able to help managed care organizations, insurers, and policy makers make informed decisions. Supporters are optimistic that the increased involvement by the federal government in comparative effectiveness research will eventually lead to increased acceptance and the use of QALYS as a
A cost-benefit analysis is “whenever people decide whether the advantages of a particular action are likely to outweigh its drawbacks” (Benefit-Cost Analysis, n.d.). The analysis estimates the economic value placed upon a
Green (2005) identifies that, “Using evidence from reliable research, to inform healthcare decisions, has the potential to ensure best practice
K. Stremikis, C. Schoen, and A.-K. Fryer. A Call for Change: The 2011 Commonwealth Fund Survey of Public Views of the U.S. Health System, The Commonwealth Fund, April 2011. Retrieved April 26th, 2011 from web site: http://www.commonwealthfund.org/Content/Publications/Issue-Briefs/2011/Apr/Call-for-Change.aspx
A simple comparison to the US system is difficult considering the multitude of insurance plans with variable premiums and the wide array of coverage depending on company size and other factors. Different from the French system, American employers do not buy insurance based on a percentage system and the money does not flow into a few National Health insurance funds, rather...
Healthcare in the U.S. has recently been affected by implementation of the Affordable Care Act (ACA) of 2010. The intent is to create a healthca...
The United States (U.S.) has a health care system that is much different than any other health care system in the world (Nies & McEwen, 2015). It is frequently recognized as one with most recent technological inventions, but at the same time is often criticized for being overly expensive (Nies & McEwen, 2015). In 2010, President Obama signed the Patient Protection and Affordable Care Act (ACA) (U. S. Department of Health & Human Services, n.d.) This plan was implemented in an attempt to make preventative care more affordable and accessible for all uninsured Americans (U.S. Department of Health & Human Services, n.d.). Under the law, the new Patient’s Bill of Rights gives consumers the power to be in charge of their health care choices. (U.S. Department of Health & Human Services, n.d.).
It is very important that we utilize cost control methods in the health care field. The reason being is that about 10% of the population, usually with chronic to severe problems, use approximately 70% of the total spending (Shi, & Singh, 2008). If we didn’t monitor the costs and spending we wouldn’t be using the money efficiently. To avoid potential problems we frequently use six different cost control methods to monitor what medical services are necessary, the most cost efficient way for these services to be provided, and keep an up to date chart of the patient’s condition to offer only treatment deemed necessary.
West, S. L., & O'Neal, K. K. (2004). Project D.A.R.E. outcome effectiveness revisited. American Journal of Public Health. doi:10.2105/AJPH.94.6.1027
spends about 15% of its gross domestic product on healthcare, thereby making it the largest sector of the economy” (Goldman, D., & McGlynn, E., 2005). “Americans are not healthier than some of the other developed nations, regardless of these extensive costs” (WHO, 2010). “Almost 40 million Americans are uninsured and about 18% of Americans under the age of 65 receive half of the recommended healthcare services” (Goldman, D., & McGlynn, E., 2005). “Though, quality of care was noted not to vary much in cities with respect to lack of insurance, poverty, penetration of managed care and availability of physicians and hospital beds” (Goldman, D., & McGlynn, E., 2005).
One of the policies that ACA made to improve healthcare quality is to provide free preventive screening, immunization, and wellness visit. Since this policy took place, 76 million Americans now receive free preventive care. Moreover, under this policy doctors will get paid more so they can take more proactive approach to patient care and making sure patients are healthy, rather than only treating them when they are sick. Also by making the healthcare recorders electronic that increased the quality of healthcare. Creating EHRs decreased healthcare errors, decreased the amount of time spent on documenting and increased space capacity. Moreover, by creating EHRs this gave the healthcare providers extra time to spend with their
Berwick, D. M. (2002). A user's manual for the IOM's 'quality chasm' report. Health Affairs,
Cost-benefit analysis is an economic approach decision making that compares the strengths and weaknesses of each choice in order to determine which option will provide the most amount of benefits and the least amount of costs. This method is often applied to decisions that concern the environment as an attempt to determine the value of the environment before following through with decisions to preserve or utilize the environment for resources. Although many economists believe that cost-benefit analysis is an efficient way to make most decisions, some philosophers suggest that certain things, including the environment, have innumerable values, therefore, cost-benefit analysis may not be a reliable method to make decisions regarding these things.
A quality-adjusted life year (QALYs) is one of the most widely used measures for measuring the quality of life and is used for the assessment of health outcomes. Health is a function of length of life and quality of life (Prieto and Sacristán, 2003) and this measure serves as composite indicator which allows quantity and quality of life in a single ind...
The meaning of quality is “the right care for the right person at the right time”. Quality can be well-defined as the value, efficiency, consistency, and outcome of the care being provided. The Center for Medicare and Medicaid Service’s (CMS) stated “an rise in health care spending from $2.34 trillion in 2008 to $ 2.47 trillion in 2009, the largest one year increase since 1960” (Pickert, 2010). “The action to improve the American health care delivery system as a whole, in all of its quality dimensions such as efficiency, effectiveness, equitability, timeliness, patient-centeredness, and safety for all Americans” (IOM, 2011). This paper aims to find out the relationship between cost and quality relating to health care.