Suppose that you are an executive in a large managed care plan in the state of California and want to choose one health promotion program from the following six competing choices (exhibit 9.5). Can any programs be ruled out because they are superior or inferior choices? Which program(s) can be ruled out by simple dominance? If any programs in answer (b) can be ruled out, why are they ruled out? How would you calculate the incremental cost-effectiveness ratio (ICER) for each program? Which program has the highest (worst) and lowest (best) ICER, and what is the ICER for each of those programs?

EXHIBIT 9.5 Incremental Cost-Effectiveness of Six Competing Health Promotion Programs Program QALYS Cost (S) A 50 75 100 MO A 14 25,000 50,000 1,000,000 900.000 2,500,000 2,000,000 150 200 225