Activity E: Economic Analysis

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Activity E: Economic Analysis

Exercise #1: ICER calculation (1)

1.1. Suppose that the bypass surgery for coronary artery disease costs $25,000 while the stenting costs $4,000. The average hospitalization costs $1,000/day. Patients given the bypass surgery on average have 4 days of hospitalization (including rehospitalization due to complications) and the stenting have an average hospitalization of 3 days. What is the incremental cost of the bypass surgery relative to the stenting?

1.2. Suppose that persons given the bypass surgery expect to gain 40 QALYs, while those given the stent live 35 QALYs. Calculate and interpret ICER for the heart bypass surgery compared with the stent.

Exercise #2: ICER calculation (2)

Compare the smoking prevention Program A with Program B. Suppose a smoking rate in an inner-city high school is 50%. Program A enroll 20 students, cost $20,000, and eventually 15 of the 20 students (75%) did not smoke. Prevention Program B enrolled 20 students, cost

$15,000, and 12 students (60%) did not smoke. Calculate an ICER of the smoking prevention programs in terms of smokers averted.

Exercise #3: Fixed vs variable costs

Ms. Betty is a manager responsible for tuberculosis-control activities at the county health department. Her clinic is located in a building leased by the county from the city. For transportation, Ms. Betty uses her personal vehicle and is reimbursed for mileage. The clinic is equipped with a portable isolation unit for infectious patients. Patients who need chest x-rays are referred to the local hospital. The clinic has a nurse who spends the majority of her time in the field, administering tuberculin skin tests to patients suspected of being infected with tuberculosis, collecting sputum samples for smears and cultures with her portable nebulizer, and administering drug treatment. Ms. Betty and the nurse use laptops and a database software program to keep track of their patients.

Identify fixed and variable costs associated with this tuberculosis-control program.

Exercise #4: Audience and Cost

4.1. Consider whether or not to provide contraceptives (birth-control pills) for free to all low- income women aged 15-35. You are tasked to assess whether free contraceptives will be cost-effective or not. For simplicity, focus on the cost of the intervention and consider how different perspectives involve different calculation of costs? Write down cost items and indicate whether the cost items should be included in a CEA (Yes or No).

4.2. Consider the issue and potential policy solutions you team is currently working on at the institute. Repeat Exercise #4.1.