Once the key study questions have been defined, a decision about the type(s) of economicstudy that can best answer the questions must be made. The most common approaches forevaluating health-related prevention programs are cost analysis, cost-effectiveness analysis(CEA), and cost-benefit analysis (CBA).22.4.1 Cost AnalysisCost analysis studies identify the personnel and other resources used to deliver preventionservices and calculate the monetary value of those resources to various stakeholders, suchas society as a whole, community providers, or government funding agencies. These studiesprovide information about the start-up and implementation costs of a prevention program—useful information to program managers who may be considering whether to implement aspecific prevention approach. Cost studies also allow program managers to addressquestions about the program resources (usually personnel) that contribute the most to2A careful discussion of these alternative approaches as applied to alcohol treatment services isavailable in Bray and Zarkin (2005). Partnership for Prevention (2001) also provides a clear generaloverview that is intended for a policy audience.Guide to Analyzing the Cost-Effectiveness of Community Public Health Prevention Approaches2-8overall costs. Answers to these questions can be useful for considering alternative resourcemixtures to limit program costs.2.4.2 Cost-Effectiveness AnalysisCEA goes a step beyond cost analysis by comparing both the costs and effectiveness of twoor more prevention strategies (one of which may be a “no program” baseline). Results fromCEA allow program managers to answer questions about whether a particular programproduces outcomes that are worth the program investment (i.e., is cost-effective) or whichof several related programs is the most cost-effective. In CEA, the effectiveness of aprogram is measured in terms of health or behavioral outcomes. For example, a worksitebasedinfluenza immunization program might measure program effectiveness in terms of“cases of influenza averted” or “number of employees vaccinated.” To facilitate comparisonsof cost-effectiveness across prevention programs, even those designed to achieve differenthealth outcomes, some CE studies convert health outcomes to a common measure. Lifeyearssaved and quality-adjusted life years (QALYs) gained are two examples. QALYs are auseful measure for programs that primarily reduce morbidity rather than extend life. Somereference materials refer to CEAs that use QALYs as a cost-utility analysis.2.4.3 Cost-Benefit AnalysisCBA values the outcomes of prevention programs in dollar terms, allowing costs to beweighed against benefits for programs with many different types of outcomes. CBA may bethe most appropriate form of analysis if a program has significant nonhealth or intangiblebenefits. For example, the construction of a bike path may have measurable long-termimpacts on health, but it may also affect housing values along the path. A specific type ofCBA is cost offset analysis, which compares the cost of prevention to reductions in healthcare and related costs resulting from the prevention program.3 The idea is that the cost ofprevention is offset by savings in future disease costs.When deciding from among alternative methods for comparing costs and benefits, youshould also be aware that CBA is somewhat controversial because it assigns a dollar valueto all health outcomes, including life. Placing a dollar value on a healthier or longer life isdifficult, and the different methods for doing so all have certain limitations.42.4.4 Cost-Effectiveness Analysis and Using This GuideThis guide focuses on CEA. If you have decided that CEA is the appropriate tool foranswering your study questions, you may consult this guide to address questions about how3Note that some references categorize cost offset studies as a cost analysis (see, e.g., Partnership forPrevention, 2001). However, because they involve a comparison of prevention program costs tobenefits valued in dollar terms (or cost savings), they can be categorized as a CBA.4For additional information on CBA as applied to health preventions and treatments, see Haddix,Teutsch, and Corso (2003) and Drummond et al. (1997). A detailed theoretical and practicaltreatment of how to value longevity and health can be found in Freeman (1993).Chapter 2 — Planning for a Cost-Effectiveness Study2-9to select appropriate outcome measures that can be used in CEA (Chapter 3), how tomeasure program costs (Chapter 4), and how to combine information on program costs andoutcomes to answer questions about cost-effectiveness (Chapter 5).2.5 Checklist for Cost-Effectiveness AnalysisThe checklist in Table 2-2 summarizes several of the issues discussed in this chapter thatshould be addressed before proceeding with data collection and analysis. This checklist mayhelp guide your CE study planning.Table 2-2. Checklist for Planning a Cost-Effectiveness StudyaDecisionCheck WhenComplete
Define the study question(s)Decide who will use study results and howDetermine which prevention approaches to evaluate and model theinputs and intended outcomes of eachIdentify the perspectives (societal is recommended,b but otherstakeholder perspectives may also be useful)Prepare initial list of program costs to be collectedSelect possible health and risk behavioral outcome(s)Determine intervention time frameDecide on analysis time periodSelect discount rate (3% is recommended)Choose type of economic studyaModified from Haddix, Teutsch, and Corso (2003), page 26.bGold et al., 1996.
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