The death of cost-minimization analysis?

Briggs, A.H. and O'Brien, B.J. (2001) The death of cost-minimization analysis? Health Economics, 10(2), pp. 179-184. (doi:10.1002/hec.584)

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Publisher's URL: http://dx.doi.org/10.1002/hec.584

Abstract

Four different types of evaluation methods, cost-benefit analysis (CBA), cost-utility analysis (CUA), cost-effectiveness analysis (CEA) and cost-minimization analysis (CMA), are usually distinguished. In this note, we pronounce the (near) death of CMA by showing the rare circumstances under which CMA is an appropriate method of analysis. We argue that it is inappropriate for separate and sequential hypothesis tests on differences in effects and costs to determine whether incremental cost-effectiveness (or cost-utility) should be estimated. We further argue that the analytic focus should be on the estimation of the joint density of cost and effect differences, the quantification of uncertainty surrounding the incremental cost-effectiveness ratio and the presentation of such data as cost-effectiveness acceptability curves. Two examples from recently published CEA are employed to illustrate the issues. The first shows a situation where analysts might be tempted (inappropriately) to employ CMA rather than CEA. The second illustrates one of the rare circumstances in which CMA may be justified as a legitimate form of analysis.

Item Type:Articles
Keywords:CEA, CMA.
Status:Published
Refereed:Yes
Glasgow Author(s) Enlighten ID:Briggs, Professor Andrew
Authors: Briggs, A.H., and O'Brien, B.J.
Subjects:R Medicine > RA Public aspects of medicine
R Medicine > R Medicine (General)
H Social Sciences > HG Finance
College/School:College of Medical Veterinary and Life Sciences > Institute of Health and Wellbeing > Health Economics and Health Technology Assessment
College of Medical Veterinary and Life Sciences
Journal Name:Health Economics
Publisher:Wiley
ISSN:1057-9230
Copyright Holders:Copyright © 2001Wiley
First Published:First published in Health Economics 10(2):179-184
Publisher Policy:Reproduced in accordance with the copyright policy of the publisher.

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