Clinical economics cost types

Each article was assessed for the type of evaluation and categorized (Table 1). Two factors were considered in determining the type of evaluation the presence of two or more alternatives, and the consideration of both input (costs) and outcomes. Evaluations that included two or more alternatives (i.e., concurrent control group, historical control, preintervention and postintervention design) were considered true analyses, whereas those that did not include a comparison were labeled descriptions. A description of the type of analysis was assigned to the evaluation and included the options of cost or outcome description, cost or outcome analysis, cost and outcome description, and true clinical economic evaluation. Those articles considered true clinical economic evaluations were subcategorized by type, options including cost-minimization analysis, cost-benefit analysis, cost-effectiveness analysis, and cost-utility analysis. 

A problem long appreciated in economic evaluations, but whose seriousness has perhaps been underestimated (Sturm et al, 1999), is that a sample size sufficient to power a clinical evaluation may be too small for an economic evaluation. This is mainly because the economic criterion variable (cost or cost-effectiveness) shows a tendency to be highly skewed. (One common source of such a skew is that a small proportion of people in a sample make high use of costly in-patient services.) This often means that a trade-off has to be made between a sample large enough for a fully powered economic evaluation, and an affordable research study. Questions also need to be asked about what constitutes a meaningful cost or cost-effectiveness difference, and whether the precision (type I error) of a cost test could be lower than with an effectiveness test (O Brien et al, 1994). 

There are four types of economic evaluation cost-minimization analysis, cost-effectiveness analysis, cost-utility analysis and cost-benefit analysis. The analytic framework chosen will depend upon the economic questions posed and the clinical evidence of effectiveness for the interventions (Gold et al, 1996 Dmmmondetal, 1997). 

Table 12.1 summarizes five major types of pharmacoeconomic evaluations cost-consequence, cost-benefit, cost-effectiveness, cost-minimization, and cost-utility (Drummond et al., 1997 Kielhorn and Graf von der Schulenburg, 2000). In a cost-consequence analysis, a comprehensive list of relevant costs and outcomes (consequences) of alternative therapeutic approaches are presented in tabular form. Costs and outcomes are typically organized according to their relationship to cost (direct and indirect), quality of life, patient preferences, and clinical outcomes (see taxonomy below). No attempt is made to combine the costs and outcomes into an economic ratio, and the interpretation of the analysis is left in large part to the reader. 

Another dimension of economic analysis of clinical practice illustrated by Fig. 1 is the evaluation of costs of a therapy. Economists consider three types of costs - direct, productivity, and intangible. 

There are different ways to look at outcomes. One method, the ECHO model, purports three basic types of outcomes economic, clinical, and humanistic (Kozma et al., 1993). Economic outcomes include direct costs and consequences, both medical and nonmedical, and indirect costs and consequences. For example, when assessing outcomes from a patient perspective, a medication copayment would be a direct medication cost, whereas gas money to pick up the medication from the pharmacy would represent a nonmedical direct cost. Lost wages from missed work could be regarded as an indirect cost. 

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