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Overview Overview
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Cost–minimization analysis Cost–minimization analysis
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Cost–benefit analysis Cost–benefit analysis
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Cost-effectiveness analysis Cost-effectiveness analysis
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Cost–utility analysis Cost–utility analysis
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Further reading Further reading
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Cite
Extract
Overview
Health economics is a branch of economics concerned with issues related to scarcity in the allocation of health and healthcare. Health economics studies how healthcare and health-related services, their costs and benefits, and health itself are distributed among individuals and groups in society. Health economics is concerned with the formal analysis of direct and indirect costs and benefits that are a consequence of a healthcare intervention, programme, or strategy. Health economics has some distinct differences from other branches of economics. These include:
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Economic evaluation of a healthcare intervention is the comparison of two or more alternative courses of action in terms of both their costs and consequences. Economists usually distinguish several types of economic evaluation, differing in how consequences are measured:
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Cost–minimization analysis
This is often considered to be the easiest evaluation to apply as it should only be utilized in situations where the benefits of alternative treatments have been proven to be identical. Therefore, the focus can be entirely on cost. However, the data supporting the assumption of equivalent clinical benefit must be robust and unambiguous before such a complete focus on costs can be justified. For a cost–minimization analysis to be a valid and reliable source of evidence to decision-makers requires the availability of high-quality clinical evidence that proves the equivalence of two treatments and, therefore, indicates the appropriateness of this method of economic evaluation.
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