Learning Objectives

• Identify theoretical and methodological differences between different economic evaluation techniques.

• Understand the concepts of summary measures of health, including quality-adjusted life years (QALYs) and disability-adjusted life years (DALYs).

• Be familiar with the steps of valuing costs in economic evaluations.

Outline

• Introduction to Economic Evaluations

  • Types of Economic Evaluations

  • Who Uses Economic Evaluations

• Valuing Health Outcomes

  • QALYs (briefly)

  • DALYs (focus of lecture)

• Valuing Costs

Economic Evaluation

• Relevant when decision alternatives have different costs and health consequences.

• We want to measure the relative value of one strategy in comparison to others.

• This can help us make resource allocation decisions in the face of constraints (e.g., budget).

Features of Economic Evaluation

Cost analysis

• Only looks at healthcare costs

• Relevant when alternative options are equally effective (provide equal benefits)

  • Rarely the case in reality!

• Costs are valued in monetary terms (e.g., U.S. dollars)

• Decision criterion: often to minimize cost

Cost-Effectiveness Analysis (CEA)

• Costs are valued in monetary terms ($)
• Benefits are valued in terms of clinical outcomes (e.g., cases prevented or cured, lives saved, years of life gained, quality-adjusted life years gained)
• Results often reported as a cost-effectiveness ratio

Cost-Effectiveness Analysis

Cost-Utility Analysis

Cost-Benefit Analysis

https://pubmed.ncbi.nlm.nih.gov/28183740/

Cost-Benefit Analysis

https://www.cambridge.org/core/product/identifier/S2194588818000271/type/journal_article

CEA components

\[ \frac{\text{(Cost Intervention A - Cost Intervention B)}}{\text{(Benefit A - Benefit B)}}\]

Why summary measures of health?

• QALYs and DALYs both provide a summary measure of health

• Allows comparison of health attainment / burden across diseases

  • Across diseases

  • Across populations

  • Across interventions

  • Over time etc.

QALYs

QALY: A metric that reflects both changes in life expectancy and quality of life (pain, function, or both)

1 = perfect health; 0= death;
Sum of weight*duration of life = quality-adjusted life expectancy

Example: Patient with coronary heart disease (with surgery)

Example: Patient with coronary heart disease (with surgery)

Example: Patient with coronary heart disease (without surgery)

Example: Patient with coronary heart disease

• With surgery: 7.875 QALYs
• Without surgery: 6.625 QALYs
• Benefit from surgery intervention:

  • In QALYs: 7.875 – 6.625 QALYs = 1.25 QALYs

  • In life years: 10 years – 10 years = 0 LYs

Off-the-shelf numbers for your own CEAs?

• Large scale utility studies
• Balancing trade offs between different measures
  • Sensitivity analyses!
• Tufts CEA registry
• Alongside Randomized Clinical Trials

DALYs

QALY: “0” = death; “1” = perfect health

DALY: “0” = perfect health; “1” = death

• QALY measures the number of healthy years gained (uses preference-based utility weights)
• DALY measures the number of healthy years lost (uses standardized disability weights)

DALYs

DALYs

DALYs = YLL + YLD

• Approach depends on purpose of study

  • Synthetic life table: Quantify disease burden across countries in relation to normative benchmark and/or in light of global justice and resource re-allocation to low-income countries
  • Country-specific life table: Assessing alternative disease interventions in Uganda; & want to quantify how many expected years of life are lost due to a disease in conditions specific to Uganda.

DALYs Example: Burden of HIV

DALYs = YLL + YLD

• Now let’s look at the DALY effect of treatment

• YLL: Providing HIV treatment extends life by 20 years compared to no treatment (an individual with HIV now lives until 70 years on treatment)

  • YLL?

Synthetic, Reference Life Table

Synthetic, Reference Life Table

DALYs = YLL + YLD

DALYs = YLL + YLD

DALYs: Another Example

• Years Lived with Disability (YLD): calculated similar to QALYs, utility weight ≈ 1 - disability weight

• YLD example: Effective asthma control for 10 years

  • Disability weight (uncontrolled asthma) = ?

  • Disability weight (controlled asthma) = ?

DALYs = YLL + YLD

DALYs for CEA

Back to CEA components

\[ \frac{\text{(Cost Intervention A - Cost Intervention B)}}{\text{(Benefit A - Benefit B)}}\]

• A common outcome is: Cost per DALY averted

• Next up: Costs; though just briefly & then we will move on to CEA thresholds

Identifying costs (continued)

• In practice, we count what is likely to matter

  • Exclude what is likely to have little effect or equal effects across alternatives

• Any exclusion must be noted & possible bias examined

• We are constrained by what data are available

Whose perspective?

CEA Thresholds

CEA Thresholds

• Different ways thresholds have been estimated: - “supply-side” (UK & Europe) - “demand-side” (US) - per capita consumption (US/LMICs)

• LMICs have often defined thresholds in terms of per capita consumption - consistent with the idea that people living in countries with higher incomes are able and willing to pay more for health - which makes intuitive sense

CEA Thresholds in LMICs

CEA Thresholds in LMICs

CEA Thresholds in LMICs

CEA Thresholds in LMICs

CEA Thresholds in LMICs

• Until we come up with a better measure, the DSP3 (Disease Control Priorities, LSHTM) & other academics have estimated more conservative thresholds (previous slide) that I would use for LMICs & would NOT use the per capita assumptions

Useful Resources

Useful Resources