About the node
Decision makers are faced with the challenge of meeting the increasing demand for healthcare services given constrained funds. Economic evaluation has been widely used to inform decisions about which healthcare interventions to fund from available resources. In Australia, the uptake of a new treatment depends on the government’s decision to provide subsidies via programs such as the Medical Benefits Schedule (MBS) and Pharmaceutical Benefits Scheme (PBS). For a new drug or device to be listed on the PBS or MBS, economic evaluation is required to determine whether it represents value for money. The Health Economics Node offers support with all aspects of economic evaluation to health researchers affiliated with the University of Melbourne.
The Health Economics Node provides support for the following types of economic evaluation:
In this type of analysis, a range of cost components (e.g., treatment costs, hospital costs, productivity costs) and health consequences (e.g., changes in blood pressure, time to progression, quality of life) are quantified and separately reported. Cost-consequence analysis usually takes a broad perspective and leaves the decision-makers to interpret the results and choose the most relevant costs and effects from their points of view.
This type of analysis is carried out when the health outcomes associated with two or more interventions are assumed to be identical. As the name suggests, the objective is to minimise cost and the intervention that has the lowest cost will be preferred.
In this type of analysis, two or more interventions are compared in terms of their costs and effects. The decision is made based on the incremental cost-effectiveness ratio (ICER), which is the difference in costs divided by the difference in effects. The effects can be measured in different units, for example, systolic blood pressure in mm Hg or remaining life expectancy in years.
This is a special type of cost-effectiveness analysis, in which the effect of the interventions is measured in terms of quality-adjusted life years (QALYs).
In this type of analysis both costs and health outcomes are quantified in monetary terms. It helps to answer the question of whether the benefits of the policy outweigh its costs, and by how much relative to other alternatives. This makes it easier to compare the benefits of policies in health care with those in other sectors (e.g., education, environment).
In any of the above-mentioned types of analysis, we provide support for development of decision analytic models, including decision trees, Markov models, discrete-time probabilistic simulation models and discrete-event simulation models. We also advise on the approaches for cost modelling and extrapolation of the health outcomes beyond the trial follow-up period.
Stages of support
We provide support throughout the whole research process, from design to completion and translation.
Design stage: development of health economic research questions, determination of relevant health economic outcomes, healthcare resource use and costs to be collected, establishment of data linkage procedures, selection of methods to analyse costs and health outcomes, writing of the health economic section in the grant application or protocol, provision of guidance on resource requirements for the health economic study and options for grant budgets.
Execution stage: supporting the collection of relevant health economic outcomes, healthcare resource use and costs, conducting interim data analyses, extrapolation of the trial results, development of decision analytic models (if relevant), and capturing uncertainty.
Completion stage: finalizing all the analyses and writing a health economic manuscript for publication.
Translational stage: interpretation and effective communication of research findings via national and international conferences, journals, websites and social media, targeting relevant groups.
A FAQ brochure can be downloaded HERE