HERC: Cost-Effectiveness Analysis Course
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Cost-Effectiveness Analysis Course

Starting January 2018, HERC will begin its course on cost-effectiveness analyses with VA data. The purpose of this course is to introduce researchers to conducting cost-effectiveness analyses and budget impact analyses of healthcare interventions in VA. Cost-effectiveness and budget impact analyses are two types of decision analysis techniques. Cost-effectiveness is a method to assess the comparative impact of different interventions on cost and health effect. The information produced by a cost-effectiveness analysis can be used by decision makers in allocating scarce healthcare resources to interventions that provide the most health benefit per dollar spent. Budget impact analyses serve as a complement to cost-effectiveness analyses. In the likely event that an intervention is cost-effective but not cost-saving, a budget impact analysis can provide decision makers with estimates of the budget and sub-budget impacts of the intervention. Therefore, a cost-effectiveness analysis is used to determine whether an intervention is high-value and a budget impact analysis is used to determine whether an intervention is affordable. This HERC course will provide an overview of the decision analysis landscape, as well as fully explicate methods to operationalize cost-effeciveness and budget impact analyses.

Target audience: This course is primarily designed for researchers who would like an introduction to methods of cost-effectiveness analysis and budget impact analysis as applied to health services and medicine.

Schedule and registration details: The lectures are held on Wednesdays, with each hourly session beginning at 11:00am Pacific or 2:00pm Eastern time, unless otherwise noted.

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Missed a lecture? It may be possible to view a recorded archive of each lecture. Some archived course content is limited to VA employees; other content is available to a broader audience. Please see the HSR&D training page for details.

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2018 Cost-Effectiveness Analysis Course
January 10, 2018
New Recommendations for the Conduct of Cost-Effectiveness Analysis from the Second Panel on Cost-Effectiveness in Health and Medicine
Doug Owens, M.D., M.S.

In this presentation, I will summarize the main new recommendations about how to design and conduct a cost-effectiveness analysis based on guidelines from the Second Panel on Cost-Effectiveness in Health and Medicine, released in the fall of 2016. In a major change from prior recommendations, the Second Panel recommends the use of two perspectives in cost-effectiveness analysis: the health care sector perspective and the societal perspective, including education and the criminal justice systems. To aid in transparency, the Panel also recommends the use of public protocols that outline how an analysis will be conducted.

January 17, 2018
An Overview of Decision Analysis
Risha Gidwani-Marszowski, Dr.P.H.

This lecture provides an introduction to the field of decision analysis. Topics include: why to engage in decision analysis; the difference between cost-effectiveness analysis, cost-utility analysis, cost-benefit analysis, and budget impact analysis; and the different ways to operationalize a decision analysis (modeling versus measurement alongside a clinical trial). This lecture is aimed at providing a general, high-level overview of the field.

January 31, 2018
Estimating the Cost of an Intervention
Todd Wagner, Ph.D.

Researchers are frequently engaged in developing and testing new behavioral interventions. In this lecture we will discuss different methods for estimating the cost of new interventions.

February 7, 2018
VA Costs: HERC versus MCA
Jean Yoon, Ph.D.

Researchers conducting cost-effectiveness analyses often need cost and utilization data. In this lecture we will review the HERC Average Cost and the Managerial Cost Accounting (MCA; formerly Decision Support System (DSS)) data. We will briefly review the different datasets commonly used in research studies. We will also discuss how these data can be merged to VA utilization data.

February 14, 2018
Introduction to Effectiveness, Patient Preferences, and Utilities
Josephine Jacobs, Ph.D.

Cost-effectiveness analysis measures the benefit or health outcome of an intervention in natural units (like a flu episode avoided) or in the quality-of-life improvement, defined by the quality-adjusted life year or QALY. This class will provide an introduction to the concepts of QALYs and preference measurement, and will include a description of the most common techniques used for measuring QALYs in economic evaluations.

February 28, 2018
Estimating Transition Probabilities for a Model
Risha Gidwani-Marszowski, Dr.P.H.

Inputs for a decision model often come from the published literature, but may not be in a form suitable for your decision model. For example, much of the literature contains Odds Ratios and Relative Risks, which need to be transformed into probabilities in order to be used in a model. Or, the literature may contain probability estimates, but they may not be relevant for the time frame of your model. This lecture will discuss ways of deriving probabilities that are specific to your model as well as deriving probabilities from published summary statistics. This lecture is aimed at the researcher who is interested in operationalizing his or her own decision model.

March 7, 2018
Medical Decision Making and Decision Analysis
Jeremy Goldhaber-Fiebert, Ph.D.

The lecture will provide an introduction to decision analysis as applied to the context of medical and public health decision making. The lecture will cover the goals and necessary elements of a decision analysis, the construction and evaluation of decision trees, and provide an introduction to how Markov models are embedded in decision analyses to consider more complex diseases. It will also discuss the important link between such analyses and cost-effectiveness analyses.

March 14, 2018
Evidence Synthesis to Derive Model Transition Probabilities (Part I - Systematic Literature Review)
Risha Gidwani-Marszowski, Dr.P.H.

When there are multiple publications that have evaluated a parameter of interest (such as disease-related mortality or the efficacy of a treatment), one may be able to quantitatively synthesize these estimates into a single input for use in a decision model. This approach to evidence synthesis is called meta-analysis. This lecture will walk researchers through the the first part of conducting a meta-analysis: a systematic literature review.

March 28, 2018
Evidence Synthesis to Derive Model Transition Probabilities (Part II - Quantitative Pooling)
Risha Gidwani-Marszowski, Dr.P.H.

When there are multiple publications that have evaluated a parameter of interest (such as disease-related mortality or the efficacy of a treatment), one may be able to quantitatively synthesize these estimates into a single input for use in a decision model. This approach to evidence synthesis is called meta-analysis. This lecture is the second in a two-part series and will walk researchers through the second part of conducting a meta-analysis: quantitatively pooling estimates from the literature to derive a single value that can be used in a decision model.

April 4, 2018
Sensitivity Analyses
Risha Gidwani-Marszowski, Dr.P.H.

Inputs for a decision model come in the form of point estimates and these point estimates inevitably have some degree of uncertainty. Sensitivity analyses test how robust the model is to this uncertainty by varying model inputs and evaluating the effect of these variations on model results. This lecture will cover deterministic and probabilistic sensitivity analyses, the latter of which is increasingly necessary in order to publish one's model in a peer-reviewed journal.

April 11, 2018
Budget Impact Analysis
Todd Wagner, Ph.D.

A budget impact analysis (BIA) estimates the cost to a health care system, or other payer, of adopting a new or proposed intervention over 1-3 years. A BIA includes costs of the intervention and the implementation of the new intervention, as well as the downstream costs of healthcare utilization. It is often done alongside a clinical trial to estimate the costs of adoption, should the new intervention be found both clinically effective and cost-effective. This class will provide a framework for the BIA and tools to determine if a BIA is an appropriate economic study to undertake.

April 25, 2018
How can cost-effectiveness analysis be made more relevant to U.S. health care?
Wei Yu, Ph.D.

After providing a brief reminder of the elements of a cost-effectiveness analysis, this lecture will describe how health policy decisions in other countries use it to set practice guidelines, determine pharmacy formularies, and make coverage decisions. Attempts to formally incorporate cost-effectiveness into U.S. policy have failed, but there are many examples of informal use of cost-effectiveness findings. Surveys of decision makers have identified barriers to using cost-effectiveness findings to make health care decisions. Published recommendations provide economics researchers with tips on how to increase the chances that their findings will be implemented.

Cost-effectiveness courses taught outside VA

Other organizations teach cost-effectiveness workshops that are not specific to VA. Tuition is charged for all of these courses.

The Society for Medical Decision Making provides short courses in association with its annual meeting, held each October. In previous years, these have included half-day sessions on economic evaluation. For more information, see:

The Program for Assessment of Technology in Health (PATH), http://www.path-hta.ca/ affiliated with McMaster University in Ontario, Canada, has offered a workshop on Advanced Methods for the Economic Evaluation of Medicines. It currently offers a workshop on economic modeling. For more information, see: http://www.path-hta.ca/Workshops.aspx

Courses on economic evaluation have been offered by the Centre for Health Economics, The University of York, UK.
http://www.york.ac.uk/che/ See their "short courses" on economics at: http://www.york.ac.uk/che/courses/short/

A list of training opportunities in health economics is available at HealthEconomics.com. However, this list may be out of date.

Pre-conference workshops are offered each June at the Conference of the American Society of Health Economists.
In recent years, these have included workshops on "Economic Evaluation of Drugs, Devices and other Medical Interventions," and "Health Econometrics of Health Cost, Expenditure and Utilization Data." Information on these workshops is found on the pages with conference details.

Publications on cost effectiveness

Read Cost-effectiveness in health and medicine by M.R. Gold and Methods for the economic evaluation of health care programmes by MF Drummond. For more information, visit the "Introduction to Cost-Effectiveness Analysis (CEA)" webpage.