When choosing between alternative courses of action in health care it is imperative to select the route with the best possible outcomes. In order to decide which approach would yield the most successful results, it is important to utilize one of the following analytical techniques: cost-effectiveness, cost-benefit, or cost-utility. However, not all three techniques can be applied to the same health care dilemma, because each method has its own criteria for calculating the best course of action.
Cost-effectiveness analysis (CEA) compares two or more health care treatments and selects the one that will yield the best results for the lowest cost. It is important to note however, that in this form of analysis the lowest financial cost is not what is being looked for. Instead, it examines the outcomes of health care treatments that cannot be measured in money such as living a longer life.
However, cost-benefit analysis (CBA) focuses on the monetary and health outcomes of the possible treatments by looking for a treatment with the best benefits, at the lowest costs. This method would be more useful for example in determining whether it is more effective to either vaccinate people against a disease or not vaccinate at all and treat the people who acquire the disease.
Finally, cost-utility analysis (CUA) is considered a specialized form of CEA, but in the case of CUA, health care outcomes are also valued in terms of utility, value or quality. For example, a CUA will differentiate between the utility of avoiding a case of melanoma or a case of poliomyelitis.
These differences in utility are measured with the use of quality-adjusted life year (QALY), which is a health measure that combines the duration of life and the health-related quality of life after treatment, and disability-adjusted life year (DALY), which measures the burden brought to the patient through the disease in terms of the number of years lost due poor-health, disability, or early death.
It is vital for researchers to carefully examine each of these three analytical methods and work alongside with physicians and other health care practitioners to establish a not only successful treatment, but a treatment that will bring about the most benefits to its patient at the lowest cost, whether it is a monetary cost or a quality cost.
We suggested here some references where you will find the distinction between cost-effectiveness, cost-benefit and cost-utility.
- Weinstein MC, Stason WB. Foundations of cost-effectiveness analysis for health and medical practices. N Engl J Med 1977; 296(13): 716-721.
- Meltzer MI. Introduction to Health Economics for Physicians: Health Economics Quintet. The Lancet. 2001; 358: 993-998.