Cost-utility ratio

Cost-utility analysis is similar to cost-efFectiveness analysis in approach, but uses utility as the outcome measure. The utility value is a measure that combines preferences for and values of the overall effect of an intervention on survival, physical and mental health, and social function. Utility is combined with estimates of length of life to provide an assessment of quality-adjusted life years (QALYs). As in cost-efFectiveness analysis, incremental cost-utility ratios are calculated to estimate the cost of producing one extra QALY. 

Incremental cost-utility ratio 00 =550000 per QALY gained... 

In SCD-HeFT, the lifetime cost effectiveness and cost utility ratios were estimated at 38 389/LYS and 41 530/quaUty adjusted LYS. A further analysis showed a cost-effectiveness ratio of 29 872/LYS for New York Heart Association Functional Class II but no incremental benefit for Functional Class III heart failure (216). Prophylactic use of single-lead, shock-only ICD seems attractive economically in patients with stable, moderately symptomatic heart failure and an ejection fraction < 0.35. 

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. 

In a cost-benefit analysis, both costs and consequences are valued in dollars and the ratio of cost to benefit (or more commonly benefit to cost) is computed. Cost-benefit analysis has been used for many years to assess the value of investing in a number of different opportunities, including investments (or expenditure) for health care services. Cost-effectiveness analysis attempts to overcome (or avoid) the difficulties in cost-benefit analysis of valuing health outcomes in dollars by using nonmonetary outcomes such as life-years saved or percentage change in biomarkers like serum cholesterol levels. Cost-minimization analysis is a special case of cost-effectiveness analysis in which the outcomes are considered to be identical or clinically equivalent. In this case, the analysis defaults to selecting the lowest-cost treatment alternative. Cost-utility analysis is another special case of cost-effectiveness analysis in which the value of the outcome is adjusted for differences in patients preferences (utilities) for the outcomes. Cost-utility analyses are most appropriate when quality of life is a very important consideration in the therapeutic decision. 

These preferences for the different disease states, expressed as numbers, are called utilities, and are used to qualitv-adjust or to weight the additional years of survival. The result is a quality-adjusted life-year (QALY) gained. Quality-adjusted life-years gained are also used frequently as the denominator of a cost-effectiveness ratio, as in costs per QALYs gained. 

Establishing the value of a new pharmaceutical can be done through a cost-effectiveness ratio, where the costs are compared with currently accepted therapy and the effect is expressed in natural units such as life-years gained or disability-free days. A cost-utility analysis uses QALYs as the expression of the drug s effect, which is a measure that incorporates all the outcomes as well as all the costs of the drug treatment. Such a broad-based measure captures how much improved the patient s life becomes as a result of the treatment and at what cost. Quality-adjusted life-years can be viewed as life-years gained,... 

If 10,000 cubic feet (10 Mcf) of CO2 costing 0.80/Mcf produce one barrel of oil, the CO2 cost is 8/bbl. Currently, CO2 utilization ratios of 10 Mcf/bbl are required for profitable operation (5). Thus, a surfactant-based process for improving sweep could cost as much as a few dollars per barrel of oil if it doubled the utilization ratio, and, correspondingly, smaller surfactant-associated costs would be commercially feasible for smaller improvements in the utilization ratio. 

The resource costs are assumed to increase with a stair-like function in proportion to the resource utilization ratios (resource use per ultimate resource supply potential). We assume that bioenergy resource costs with disposal costs, such as black liquor, animal dung, and human manure, are zero. These costs may be negative actually. 

AWP average wholesale price B/C ratio beneht-to-cost ratio CAP community-acquired pneumonia CBA cost-beneht analysis CCA cost-consequence analysis CEA cost-effectiveness analysis COI cost of illness CMA cost-minimization analysis CUA cost-utility analysis... 

One important technical evaluation criterion for electrolytic processes is the efficiency, i.e. the cost-benefit ratio for an industrial electrolysis system. When determining the efficiency, it is expedient to utilize the heating value (3.54 kWh Nm ) or the thermoneutral voltage Vth = 1.48 V because in commercial electrolysis systems for alkaline and PEM electrolysis, water is added in its liquid state. As such, the efficiency referring to the heating value of hydrogen specifies how efficiently the electrolyzer or the entire electrolysis system with all auxiliary components can be operated. 

In both of these examples, PKU and fatty acid oxidation disorders, the methods utilized at this time are characterized by their comprehensiveness, cost-benefit ratios, and their ability to be used as part of a diagnosis of a particular disorder. In fact, these methods demonstrate that the future of clinical chemistry is multianalyte analysis that enables low cost even with relatively expensive instrumentation. Multianalyte analysis is not new to clinical chemists as the chemistry analyzers in hospitals and labs are used to analyze several dozens of compounds. A close look at these assays, however, will demonstrate that they are not true multiplexed analyses but rather a large robotic system performing 24 individual assays with 24 different chemistries and standards. MS/ MS enables a single analysis, a single chemistry, and many results. 

The membrane electrode assembly (MEA) is the heart of a fuel cell stack and most likely to ultimately dictate stack life. Recent studies have shown that a considerable part of the cell performance loss is due to the degradation of the catalyst layer, in addition to membrane degradation. The catalyst layer in PEMFCs typically contains platinum/platinum alloy nanoparticles distributed on a catalyst support to enhance the reaction rate, to reach a maximum utilization ratio and to decrease the cost of fuel cells. The carbon-supported Pt nanoparticle (Pt/C) catalysts are the most popular for PEMFCs. Catalyst support corrosion and Pt dissolution/aggregation are considered as the major contributions to the degradation... 

The commercial potential of other extractable carbohydrates has been neither proposed nor promoted for one or more of the following reasons a) they are present in amounts too small to make their extraction economical b) their extraction is difficult c) they are more conveniently and inexpensively obtained from other sources d) the wood is more valuable for purposes other than being chipped and extracted and/or e) they remain undetected as a result of not being sought (see Chap. 4). Larch arabinogalactan is not being utilized currently because no application has been found for which it is uniquely suited - that is, where its cost functionality ratio makes it the gum of choice. 

The income statement was created on a spreadsheet to facilitate running many scenarios. Careful review of the Table 10.8 scenario illustrates the application of various topics covered in this chapter, including raw labor rate utilization rate overhead as a sum of non-billable direct labor cost and non-billable, non-salary costs expense ratio overhead ratio and charge-out rates. The calculated values of parameters such as utilization rate (U), expense ratio (R), overhead ratio (O), and multiplier (M), when compared to values common in the consulting industry, provide a check on the reasonableness of any scenario. Unreasonable values of parameters would be cause for exploring additional scenarios until a workable income statement can be developed. 

Moving business into virtualization brings undoubtedly many benefits. First, server consolidation allows increasing the utilization of physical servers. Many servers use only 10 to 15% of hardware re-sources (Portnoy 2012), thus other resources are wasted. Such a solution is very unprofitable. Virtualization gives the way to better utilization of resources. Moving processing environments to virtual machines decreases the number of physical machines with utilization ratio up to 90% (Portnoy 2012). Fewer servers also reduce the costs of power consumption as well as money spends on hardware maintenance. 

Another variable that needs to be set for distillation is refiux ratio. For a stand-alone distillation column, there is a capital-energy tradeoff, as illustrated in Fig. 3.7. As the refiux ratio is increased from its minimum, the capital cost decreases initially as the number of plates reduces from infinity, but the utility costs increase as more reboiling and condensation are required (see Fig. 3.7). If the capital... 

Distillation capital costs. The classic optimization in distillation is to tradeoff capital cost of the column against energy cost for the distillation, as shown in Fig. 3.7. This wpuld be carried out with distillation columns operating on utilities and not integrated with the rest of the process. Typically, the optimal ratio of actual to minimum reflux ratio lies in the range 1.05 to 1.1. Practical considerations often prevent a ratio of less than 1.1 being used, as discussed in Chap. 3. 

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