Cost-effectiveness analysis: problems and promise for evaluating medical technology

Timothy R. Juday

doi:10.1117/12.195481

6 December 1994 Cost-effectiveness analysis: problems and promise for evaluating medical technology

Timothy R. Juday

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Proceedings Volume 2307, Health Care Technology Policy I: The Role of Technology in the Cost of Health Care; (1994) https://doi.org/10.1117/12.195481
Event: The Role of Technology in the Cost of Health Care, 1994, Arlington, VA, United States

Abstract

Although using limited financial resources in the most beneficial way is, in principle, a laudable goal, actually developing standards for measuring the cost-effectiveness of medical technologies and incorporating them into the coverage process is a much more difficult proposition. Important methodological difficulties include determining how to compare a technology to its leading alternative, defining costs, incorporating patient preferences, and defining health outcomes. In addition, more practical questions must be addressed. These questions include: who does the analysis? who makes the decisions? which technologies to evaluate? what resources are required? what is the political and legal environment? how much is a health outcome worth? The ultimate question that must be answered is what is a health outcome worth? Cost-effectiveness analysis cannot answer this question; it only enables comparison of cost- effectiveness ratios across technologies. In order to determine whether a technology should be covered, society or individual insurers must determine how much they are willing to pay for the health benefits. Conducting cost-effectiveness analyses will not remove the need to make difficult resource allocation decisions; however, explicitly examining the tradeoffs involved in these decisions should help to improve the process.

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Timothy R. Juday "Cost-effectiveness analysis: problems and promise for evaluating medical technology", Proc. SPIE 2307, Health Care Technology Policy I: The Role of Technology in the Cost of Health Care, (6 December 1994); https://doi.org/10.1117/12.195481

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KEYWORDS

Medicine

Standards development

Legal

Cancer

Manufacturing

Oncology

Medical devices

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