This presentation will provide an overview of “distributional” or “equity-informative” cost-effectiveness analysis (DCEA) in health care and public health, with illustrative examples and careful attention to the controversial value judgements needed at each stage of the analysis. The presentation will draw on material being prepared for the forthcoming Oxford University Press book: “Distributional Cost-Effectiveness Analysis: A Handbook of Equity-Informative Health Economic Evaluation”, edited by Richard Cookson, Susan Griffin, Ole Norheim and Anthony Culyer, which is due for publication in late 2020. The phrase “distributional” emphasises that the focus is on distributions of costs and effects, not just aggregate costs and effects. The phrase “equity-informative” emphasises that the focus is on generating new information about equity, not just incorporating pre-existing value judgements about equity into the analysis.
Standard cost-effectiveness analysis (CEA) provides information about the efficiency of alternative decision options in terms of aggregate costs and effects. DCEA is an umbrella term for various ways of using CEA to provide additional information about equity in the distribution of costs and effects. DCEA methods can range from basic two-group equity weighting that gives priority to a special group of programme recipients (e.g. end-of-life patients) through to comprehensive simulation modelling of costs and effects by multiple equity-relevant variables (e.g. by socioeconomic status, location, ethnicity, disease severity) together with formal evaluation of equity impacts and equity-efficiency trade-offs. When distributional information is provided about financial protection effects, as well as the health effects, DCEA is also known as “extended cost-effectiveness analysis” (ECEA). There are also “quick and dirty” forms of DCEA that provide approximate distributional breakdowns using existing aggregate information, without the need for detailed new simulation modelling. DCEA is designed to be a flexible toolkit capable of providing new information about distributional consequences that exposes value judgements about equity to scrutiny and that decision makers and stakeholders will find useful whatever their political persuasion.
Richard Cookson is a professor at the Centre for Health Economics, University of York. He has helped to pioneer “equity-informative” methods of health policy analysis including methods of distributional cost-effectiveness analysis; methods of health equity monitoring for healthcare quality assurance; and methods for investigating public concern for reducing health inequality. He has co-chaired various international working groups on equity, and his UK public service includes working in the Prime Minister’s Delivery Unit and serving on NICE advisory committees and the NHS Advisory Committee for Resource Allocation.
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