Cost-Effectiveness Models Essay Sample

Published: 2022-11-14
Cost-Effectiveness Models Essay Sample
Type of paper:  Essay
Categories:  Medicine Financial analysis Human services
Pages: 6
Wordcount: 1465 words
13 min read

Cost-effectiveness analysis (CEA) approximates the cost and health benefits of alternative inventions. It provides a means through which there is prioritisation of resources allocated to the health and environment interventions through the identification of projects that have a high probability to improve the health with an application of the least resources (Weinstein & Stason, 1977). This is an essential tool in the making of the decision on the medical care that should be applied. Cost-effective models facilitate the analysis. Cost-effectiveness models are a mode of predicting effectiveness and cost of involvement based on the suitable available evidence. The model quantifies the benefits or the challenges in the people's health due to a particular law or intervention (Levin & McEwan, 2000). Some of the models include disability-adjusted life years (DALYs) and quality-adjusted life years (QALYs).

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Disability-adjusted life years (DALYs) are a cost effectiveness model that measures the benefits accrued to morbidity and mortality. It enables the contrast of all kinds of health results (McKenna, Michaud, Murray & Marks, 2005). DALY is essential for the quantitative analysis of the disease heaviness as well as analysing the cost effectiveness of an alternative intervention. DALY measures the health results by use of two components which are: the life quality reduced as a result of disability as well as a lost lifetime as a result of premature mortality (Anand & Hanson, 1997). On the other hand, quality-adjusted life years (QALYs) is a summarised result measure that is applied in the quantification of the specific intervention effectiveness. QALY's have been specifically tailored to combine both the life quality and quantity life associated with an intervention. QALY's is the most common means of value measurement on healthcare intervention provision (Torrance & Feeny, 1989). It measures the health outcomes values assuming that health operates as a life length and life quality function. The QALY's is determined by multiplication of the utility value with a particular health state by the years lived in the country.

The World Health Organization (WHO) defines quality-adjusted life years (QALYs) as the state of total mental, physical and social wellbeing without the diseases or infirmity. WHO accord that QALY is a quantifiable object or measurable by use of elements mentioned above (Sculpher, Fenwick & Claxton, 2000). The medical providers usually apply physical, social and the mental status to make decisions in regards to the how to provide care to the patients. This helps them in the evaluation of whether the medical interventions alongside other tools in the promotion of health (Jia & Lubetkin, 2010). The QALYs proposers argue that the healthcare resources allocation is dependent on the expected lifespan of the individual by use of the QALY analysis which is a reasonable and efficient means to ensure that individuals that have a higher probability of living quarter years are cared for perfectly. However, they do not make suggestions that individuals with lesser projected life terms or serious medical challenges not getting the vital care required, which is a known argument amidst the opposition. Instead, the proposers of the cases are that the healthcare resources should give individuals that have the most chances of living quality life years first, then provide for individuals that have a lower chance of living (Mehrez & Gafni, 1989). The idea is based on in case of an emergency, the medical response team is sent to the scenario where the accident occurred, and there is enough evidence that at least one of the victims may die whereas the other has a higher survival chance where the medics would dedicate their EMTs to provide the patients with the highest chances of survival access to the available health resources to maintain their lives. However, this doesn't imply that they ignore the victims with serious injuries but would work to provide comfort to the patient in the hour of need. QALY is founded through quantitative scores and empirical data to describe the life quality expected for the patient regardless of the age (Rasanen et al. 2007). The medical providers consider more patients from their previous health history and their eligibility by use of the updated technology to assist in the quality life.

QALY assessment is opposed in the determination of the allocation of resources in the U.S. healthcare delivery system. This is because some people argue that people will lose autonomy in case the health resources are to be allocated (Prieto & Sacristan, 2003). There are concerns that the patients may lack the say in regards to the health outcomes as their outcome may be decided by the group of professionals instead of the patient's family. The model further will be a proof that the healthcare in the US will be more of a capitalistic venture based on financing rather than a humanistic venture with quality results for the patients offered with healthcare services (Rasanen et al. 2006).

The disability-adjusted life year (DALY) measure the whole disease burden which is expressed as the number of years lost as a result of ill-health, disability and death (Haagsma et al. 2016). This model was created in the 1990s as a means of developing a contrast the overall health to the life expectancy in a different nation. It was first introduced in the policy regulations by the World Development Report health investment. DALY is calculated through a combination of life expectancy measures and the adjusted life quality in the period of the disease or the disability in a given population (Devleesschauwer et al. 2014). One DALY makes a representation of the loss in one healthy year expressed as DALYs per 1000 people. There is a correlation between the DALY and the QALY measure although the distinction is that QALY is restricted to the benefits measurement and with no medical intervention, therefore, fails to measure the total burden. Extensively, unlike DALY, QALY does not regulate the whole societal as it concerned more with the individual measure. DALY is dependent on the perception that the most effective action of the effects of the chronic disease is time, which is accounted by the time lost due to premature mortality and time spent on disabled by the illness.

This model faces challenges in the determination of the allocation of resources in the U.S. healthcare delivery system as it is not an economic measure. It is more concerned with the lost healthy life. It fails to assign the financial value to any individual as well as a condition, therefore does not measure the work productivity as well as the lost finances in the resulting disabling of the individual period or the premature mortality (Murray et al. 2012). Nonetheless, both DALYs and QALYs are essential to cost-effective tools in the making of the decision in the allocation of health resources as they give a common numerator (Russell, Gold, Siegel, Daniels & Weinstein, 1996). The numerator's utility can be expressed through the cost-effective model per dollar.


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Devleesschauwer, B., et al. (2014). Calculating disability-adjusted life years to quantify burden of disease. International journal of public health, 59(3), 565-569.

Haagsma, J. A., et al. (2016). The global burden of injury: incidence, mortality, disability-adjusted life years and time trends from the Global Burden of Disease study 2013. Injury prevention, 22(1), 3-18.

Jia, H., & Lubetkin, E. I. (2010). Trends in quality-adjusted life-years lost contributed by smoking and obesity. American journal of preventive medicine, 38(2), 138-144.

Levin, H. M., & McEwan, P. J. (2000). Cost-effectiveness analysis: Methods and applications (Vol. 4). Sage.

McKenna, M. T., Michaud, C. M., Murray, C. J., & Marks, J. S. (2005). Assessing the burden of disease in the United States using disability-adjusted life years. American journal of preventive medicine, 28(5), 415-423.

Mehrez, A., & Gafni, A. (1989). Quality-adjusted life years, utility theory, and healthy-years equivalents. Medical decision making, 9(2), 142-149.

Murray, C. J., et al. (2012). Disability-adjusted life years (DALYs) for 291 diseases and injuries in 21 regions, 1990-2010: a systematic analysis for the Global Burden of Disease Study 2010. The lancet, 380(9859), 2197-2223.

Prieto, L., & Sacristan, J. A. (2003). Problems and solutions in calculating quality-adjusted life years (QALYs). Health and quality of life outcomes, 1(1), 80.

Rasanen, P., et al. (2006). Use of quality-adjusted life years for the estimation of effectiveness of health care: A systematic literature review. International journal of technology assessment in health care, 22(2), 235-241.

Rasanen, P., et al.. (2007). Effectiveness of hip or knee replacement surgery in terms of quality-adjusted life years and costs. Acta orthopaedica, 78(1), 108-115.

Russell, L. B., Gold, M. R., Siegel, J. E., Daniels, N., & Weinstein, M. C. (1996). The role of cost-effectiveness analysis in health and medicine. Jama, 276(14), 1172-1177.

Sculpher, M., Fenwick, E., & Claxton, K. (2000). Assessing quality in decision analytic cost-effectiveness models. Pharmacoeconomics, 17(5), 461-477.

Torrance, G. W., & Feeny, D. (1989). Utilities and quality-adjusted life years. International journal of technology assessment in health care, 5(4), 559-575.

Weinstein, M. C., & Stason, W. B. (1977). Foundations of cost-effectiveness analysis for health and medical practices. New England journal of medicine, 296(13), 716-721.

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