Modelling in economic evaluation
Abstract
Economic evaluations depend on evidence on the costs and health effects of medical and public health interventions. This evidence can be derived from clinical trials, observational studies, meta-analysis, databases, administrative records and case reports. Because the evidence required on consequences and costs of interventions is never present in a single source, practitioners of cost-effectiveness analysis use analytical structures–or mathematical models–to synthesize data on the costs and benefits of alternative clinical strategies. These mathematical representations can be used to simulate a patient’s or a population’s life experience under a variety of intervention scenarios. A model synthesizes data from multiple sources by making explicit assumptions about the incidence and/or prognosis of a disease, the magnitude and duration of risks and benefits of prevention and/or treatment, the determinants of utilization of health-care resources, and of health-related quality-of-life. Of particular value to clinicians and policy makers, a model allows one to investigate how cost-effectiveness ratios might change if the values of key parameters in a model, which are often unobservable in primary data, are changed. Typical outputs from a model are life expectancy, quality-adjusted life expectancy, and lifetime costs.
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Stability of model results is assessed by calculating variance from multiple runs with identical number of individuals, which should be much smaller than the smallest difference expected between strategies.
“Stability of model results is assessed by calculating variance from multiple runs with identical number of individuals [55], which should be much smaller than the smallest difference expected between strategies.”
From State-Transition Modeling: A Report of the ISPOR-SMDM Modeling Good Research Practices Task Force-3 (2012) · cites this paper as [55]
Life-table mortality can be subtracted from total mortality to estimate the reduction in disease-specific mortality.
“Alternatively, life-table mortality could be subtracted from total mortality to estimate the reduction in disease-specific mortality [55].”
From State-Transition Modeling: A Report of the ISPOR-SMDM Modeling Good Research Practices Task Force-3 (2012) · cites this paper as [55]
Other effect measures such as odds ratio, risk ratio, or risk differences can be used depending on the methods used to estimate them.
“However, other effect measures can be used, such as odds ratio, risk ratio, or risk differences depending on the methods used to estimate them.30–32”
From A Tutorial on Time-Dependent Cohort State-Transition Models in R Using a Cost-Effectiveness Analysis Example (2023) · cites this paper as [30]
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- Authors
- Kuntz, K. M., & Weinstein, M. C.
- ORCID
- Kuntz, Karen M
- Venue
- Economic Evaluation in Health Care
- Publisher
- Oxford University PressNew York, NY
- Published
- 2001-11-15
- Pages
- 141-171
- OpenAlex
- W4388330820
- Cited by
- 87
- References
- 0
- Citations by year
- 2026: 1 · 2025: 1 · 2024: 3 · 2023: 2 · 2022: 3 · 2021: 2 · 2019: 1 · 2018: 5 · 2017: 2 · 2016: 1 · 2015: 6 · 2014: 4 · 2013: 3 · 2012: 6
- FWCI
- 6.18
- Type
- book chapter
- Language
- en
- Open access
- closed
- Topics
- Social Sciences › Economics, Econometrics and Finance › Economics and Econometrics › Health Systems, Economic Evaluations, Quality of Life
- Social Sciences › Decision Sciences › Management Science and Operations Research › Evaluation and Performance Assessment
- Social Sciences › Economics, Econometrics and Finance › Economics and Econometrics › Economic and Environmental Valuation
- Keywords
- economic evaluation, cost-effectiveness analysis, mathematical model, health economic modelling, cost-effectiveness ratio, quality-adjusted life expectancy, health-related quality of life, healthcare resource utilization, parameter sensitivity analysis
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