DM3 Outcomes Research in Medication use: Hcfa''s Health Care Quality Improvement Program

The objective of public policy decision making is to choose the set of interventions that maximize the net benefit to society. Given a set of mutually exclusive interventions, the one with the lowest cost-effectiveness ratio is not necessarily the one that maximizes net benefit. Thus, a treatment with a higher cost-effectiveness ratio compared to baseline may result in higher net benefits if its incremental cost-effectiveness is less than the dollar value of the outcome. In this presentation we describe how to use cost-effectiveness results to determine the intervention that maximizes net benefit. We also show how cost-effectiveness results can be used to determine threshold values for the benefit than another. We then examine the effect of budget constraints on this decision making problem. We also present a graphical means of representing cost-effectiveness results that allow for easy interpretation and use of the results. We describe a simple rule for identifying the net benefit maximizing intervention from this graph. We will illustrate the issue discussed using examples from the medical literature. This workshop should be beneficial to health care decision makers who have to interpret cost-effectiveness results and incorporate them in their decision making process.