Economic evaluation of new medical technology

Abstract

Safety and efficacy are not the only parameters of interest for choice of medical technology--costs play an increasingly important role. There is a growing interest in 'value for money', which can be assessed by economic evaluation comparing the costs and consequences of alternative courses of action. A number of different economic evaluation methods may be used: cost-minimization (looking only at costs with no consideration of consequences); cost-effectiveness (in which a unidimensional clinical outcome is assessed, for example, life-years gained); cost-utility (measuring multidimensional outcomes, for example quantity and quality of life); and cost-benefit (where outcome is considered in monetary terms). A Swedish cost-of-illness study showed that the direct health care costs increased and the indirect cost (in terms of production loss) associated with treatment of peptic ulcer fell following the introduction of H2-receptor antagonists. In a study of reflux oesophagitis, omeprazole was shown to be more cost-effective than ranitidine. With omeprazole, the costs were lower and the effectiveness better than with the H2-receptor antagonist.