Cost-Benefit Analysis versus Cost-Effectiveness Analysis from a Societal Perspective in Healthcare.

Cost-effectiveness analysis (CEA) is the main way that economic evaluations are carried out in the health care field. However, CEA has limited validity in deciding whether any health care evaluation is socially worthwhile and hence justifies funding. Cost-Benefit Analysis (CBA) is the economic evaluation method that should be used to help decide what to invest in when the objective is to record the impact on everyone in society. Cost-utility analysis (CUA), which has its roots in CEA, can be converted into CBA under certain circumstances that are not general. In this article, the strengths and weaknesses of CEA relative to CBA are analyzed in stages, starting in its most classical form and then proceeding via CUA to end up as CBA. The analysis takes place mainly in the context of five actual dementia interventions that have already been found to pass a CBA test. The CBA data is recast into CEA and CUA terms in tabular form in order that the contrast been CEA and CBA is most transparent. We find that how much of the fixed budget that is used up to fund other alternatives determines how much is left over to fund the particular intervention one is evaluating.

Behavioral versus Biological Definitions of Dementia Symptoms: Recognizing that Worthwhile Interventions already Exist.

BACKGROUND: The 2018 Alzheimer's Disease Facts and Figures special report includes two new guidelines for measuring dementia symptoms. The first requires that a biomarker (biological factor) be added to a doctor's clinical judgment of the cause of symptoms when determining whether dementia is present. The second involves identifying four stages of dementia: normal cognition, preclinical, MCI and dementia. Now only those with defining brain pathologies and significant symptoms will be judged to be persons with stage 4 dementia. This article examines the implications of adopting these two new guidelines. The implications are in terms of whether worthwhile dementia interventions can be said to exist, and the extent to which symptoms have to change for an intervention to be judged to have reduced the prevalence of dementia. METHODS: A cost-benefit framework is used to examine the implications of the new guidelines. To undertake a cost-benefit analysis (CBA) a measure of dementia symptoms change is required for any intervention to be judged effective. A behavioral measure of dementia symptoms is thought more useful than a biological one. The instrument that is recommended and explained is the clinical dementia rating (CDR) scale, which is measured on a 0-to-18 interval. Using this instrument, three CBAs can be shown to exist, and from a contracted version of the CDR, estimates of the prevalence rates for the four stages of dementia are derived. The implications for future dementia research of using the full CDR instrument is presented in the discussion section. RESULTS: The three CBAs that are reported and explained are years of education, Medicare eligibility and hearing aids. For each intervention, the analysis is in terms of demonstrating that it is effective, beneficial and socially worthwhile. CONCLUSIONS: By using a behavioral rather than a biological definition of dementia symptoms, we can show that worthwhile interventions already exist.

A Cost-Benefit Analysis of Hearing Aids, Including the Benefits of Reducing the Symptoms of Dementia.

We carried out a CBA of hearing aids (HAs) in which we estimated the direct utility benefits, and included the indirect utility benefits working through a reduction in dementia symptoms. The benefits methodology involved using QALYs as the outcome measure and then applying the price of a QALY to convert the outcome measure into monetary terms. The price of a QALY was derived from an age specific VSL estimate. The effects of HAs on utility were estimated from a fixed effects regression on a large national panel data set provided by NACC where we used a negative proxy for the QoL. We also used a fixed effects regression for the estimate of the indirect benefits involving HAs reducing dementia symptoms. We found that the total benefits, mainly coming from the direct benefits, were extremely large relative to the costs, with benefit-cost ratios over 30.

Estimating the monetary benefits of medicare eligibility for reducing the symptoms of dementia.

We adopt a three-component method based on the idea of cost-saving for estimating the monetary benefits of Medicare eligibility for reducing dementia symptoms. The method involves Medicare eligibility lowering dementia symptoms, which reduces the need for dependent living, which in turn lowers caregiving costs. We use the Regression Discontinuity approach to establish a causal link between Medicare eligibility and dementia. The novel aspect of the study comes from using a quality-of-life proxy measure for the utility function to derive the marginal rate of substitution between dementia symptoms reduction and dependent living arrangements.

The value of a year's general education for reducing the symptoms of dementia.

We present a method for estimating the benefits of years of education for reducing dementia symptoms based on the cost savings that would accrue from continuing independent living rather than relying on formal or informal carers. Our method for estimating the benefits of education involves three steps: first taking a year of education and seeing how much this lowers dementia, second using this dementia reduction and estimating how much independent living is affected and third applying the change in caregiving costs associated with the independent living change. We apply our method for estimating education benefits to a National Alzheimer's Coordinating Center sample of 17,239 participants at 32 US Alzheimer's disease centres over the period September 2005 and May 2015.

The value of reducing HIV stigma.

HIV-stigma is a major reason why HIV continues to be a global epidemic. Interventions targeting HIV-stigma are therefore necessary. To find an intervention that is worthwhile, a Cost-Benefit Analysis is needed which compares costs and benefits. There are many documented costs of HIV-stigma. What is missing is a valuation of the benefits of reducing HIV-stigma. The purpose of this paper is to present a general method that can be used to value the benefits of stigma reduction programs. The method involves estimating the marginal rate of substitution (MRS) between stigma and income in the utility function of older people with HIV. To illustrate how our framework can be used, we applied it to a sample of just over 900 people coming from the 2005-06 ROAH study (Research on Older Adults with HIV) in New York City.

The effects of HIV medications on the quality of life of older adults in New York City.

A three-equation model is used to estimate the multiple effects of antiretroviral medications (ARVs) on the quality of life (QoL) of the elderly with HIV in New York City. The transmission mechanism involves the ARVs having a direct effect on QoL via the side effects of the medications and two other effects (one indirect and one reverse) both working through feelings of depression. On a scale of 0 to 100, ARVs raise the QoL by 1 percentage point. This was because there was a large positive indirect effect of ARVs on QoL of 28 percentage points via the reduction in depression, which offsets both the 24 percentage-point reduction due to the direct effect and the 3 percentage-point decline from the reverse effect. Now, QoL effects can be applied to the additional life years generated by ARVs to form the quality adjusted life years outcome measure for use in economic evaluations of ARVs.

Economic evaluations of HIV prevention in rich countries and the need to focus on the aging of the HIV-positive population.

PURPOSE OF REVIEW: The Centers for Disease Control and Prevention has stressed testing as a prevention program for HIV/AIDS. Data on the effectiveness of these efforts are now available. The advent of successful antiretroviral (ARV) therapies and longer life expectancies has resulted in an emerging cohort of older adults with HIV. Due to differences in life expectancies and the availability of ARVs in rich and poor countries, the growth in the older population with HIV is not universal, although this situation is changing due to policies advocated by the UN for universal access to ARVs. RECENT FINDINGS: The literature on differences in access to ARVs of those with HIV in rich and poor countries, and the efficacy of ARVs in reducing opportunistic infections and AIDS-related comorbidities, is still emerging. The current study reviews findings relative to the benefits and effectiveness of testing as a prevention strategy and highlights the impact of age on HIV testing, and the need for more evaluations in this area. SUMMARY: HIV testing and prevention are effective in older adults. More education and outreach is needed on HIV risk in this population to healthcare providers and older adults themselves. HIV prevention materials need to be age-appropriate in order to be effective in the older population.

A social cost-benefit criterion for evaluating Voluntary Counseling and Testing with an application to Tanzania.

RATIONALE: There are many interventions for HIV/AIDS that require that people know their status and hence require a HIV test. Testing that is driven by a desire to prevent the spread of the disease often has an indirect effect on others. These external effects need to be identified, quantified and included as part of the benefits and costs of testing. Pioneering analyses of HIV testing by Philipson and Posner have introduced the economic calculus of individual expected benefits and costs of activities into an understanding of the HIV epidemic. What is required for social evaluations is an extension of the analysis to ensure that external effects are included. OBJECTIVES: The objective of this paper is two-fold. First we seek to formulate cost-benefit criteria that incorporate fully the external effects in the evaluation of Voluntary Counseling and Testing (VCT). We achieve this by recasting the individual calculus of benefits and costs to a couple setting. We can then compare an individual's cost-benefit analysis of being tested with social criteria that look at outcomes from a couple's perspective for both separate and dual/joint testing. Second we aim to apply our social criteria to VCT programs as they currently operate in Tanzania and how these programs might operate in the future when they are scaled up to relate to the general population. METHODOLOGY: We develop social criteria for evaluating separate and dual VCT using a couple's perspective with and without altruism. Therefore, the welfare function is based on two individual expected utility functions viewed as a couple, either married or regular partners. The benefits are the averted lives lost whenever discordant couples are revealed. The costs of VCT are the benefits of unprotected sex that the couple foregoes and the costs of the testing and counseling. The cost-benefit criteria are applied to VCT programs in Tanzania. The four main ingredients estimated are: the foregone benefit of unprotected sex (measured by the compensated wage differentials charged by commercial sex workers); the probability of infection; the cost of an infection (measured by both the value of a statistical life and the human capital approaches) and the cost of a single test (which includes behavior-modifying counseling). CONCLUSIONS: We find separate testing in existing VCT programs to be only marginally worthwhile. However, in scaled-up programs the benefit-cost ratio is over three. Dual testing is always more beneficial than separate testing. However, this advantage is reduced in scaled-up programs. VCT should be greatly expanded throughout Tanzania as future returns would be even higher for both separate and joint counseling and HIV testing.

The role of public and private transfers in the cost-benefit analysis of mental health programs.

This paper revisits the issue of whether to include maintenance costs in an economic evaluation in mental health. The source of these maintenance costs may be public or private transfers. The issue is discussed in terms of a formal cost-benefit criterion. It is shown that, when transfers have productivity effects, income distribution is important, and one recognizes that public transfers have tax implications, transfers can have real resource effects and cannot be ignored. The criterion is then applied to an evaluation of three case management programs in California that sought to reduce the intensive hospitalization of the severely mentally ill.