Question
The Department of Health is preparing for its budget allocation process for the upcoming year. The Department has identified a number of potential treatment alternatives
The Department of Health is preparing for its budget allocation process for the upcoming year. The Department has identified a number of potential treatment alternatives (including no treatment, A) across the following disease areas: Cancer, Cardiovascular Disease, Dementia, Sexually Transmitted Disease, and Childhood Obesity. To inform its decision making process, the Department wishes to consider cost effectiveness evidence. They have generated data on health care costs and health outcomes, in terms of Quality Adjusted Life Years (QALYs), for each option. On the basis of the information provided in Table 1, please answer the questions listed below. The Department will apply a cost effectiveness threshold value of 45,000 per QALY to inform its decision making process.
Table 1: Cost and QALY estimates for treatment alternatives
Treatment | Cost () | QALYs Gained |
Cancer | ||
A (no treatment) | 0 | 0 |
B | 200,000 | 8 |
C | 600,000 | 9 |
D | 500,000 | 12 |
E | 700,000 | 14 |
Sexually Transmitted Disease | ||
A (no treatment) | 0 | 0 |
F | 100,000 | 10 |
G | 200,000 | 21 |
H | 375,000 | 35 |
Childhood Obesity | ||
A (no treatment) | 0 | 0 |
I | 100,000 | 11 |
J | 250,000 | 27 |
K | 200,000 | 21 |
L | 500,000 | 48 |
M | 600,000 | 56 |
From a cost effectiveness perspective, which treatment options, if any, would you recommend to the Department for the above three disease areas? Briefly explain your recommendation. Please show all your computations.
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started