Distributional Cost-Effectiveness Analysis: A Tutorial

Abstract

Distributional cost-effectiveness analysis (DCEA) is a framework for incorporating health inequality concerns into the economic evaluation of health sector interventions. In this tutorial, we describe the technical details of how to conduct DCEA, using an illustrative example comparing alternative ways of implementing the National Health Service (NHS) Bowel Cancer Screening Programme (BCSP). The 2 key stages in DCEA are 1) modeling social distributions of health associated with different interventions, and 2) evaluating social distributions of health with respect to the dual objectives of improving total population health and reducing unfair health inequality. As well as describing the technical methods used, we also identify the data requirements and the social value judgments that have to be made. Finally, we demonstrate the use of sensitivity analyses to explore the impacts of alternative modeling assumptions and social value judgments.

Keywords: cost-effectiveness analysis; economic evaluation; efficiency; equality; equity; fairness; health distribution; health inequality; inequality measures; opportunity cost; social value judgments; social welfare functions; tradeoff.

Figure 1

Baseline health distribution.

Figure 2

(A) Guaiac fecal occult blood test (gFOBT) uptake distribution by strategy; and (B) colonoscopy uptake distribution.

Figure 3

(A) Health compared to no screening (per million of population invited for screening); and (B) health compared to standard screening (per million of population invited for screening).

Figure 4

(A) Sensitivity to level of relative inequality aversion; and (B) sensitivity to level of absolute inequality aversion.