Health Economics is a rapidly growing interdisciplinary field that seeks to understand and analyze how healthcare systems and individual behaviours interact with scarce resources. By integrating economic principles with healthcare practices, this discipline provides invaluable insights into the allocation of resources, the demand and supply of health services, and the overall efficiency and equity of health systems. This chapter will delve into the key concepts and techniques in health economics, providing a solid foundation for understanding the complex dynamics that drive healthcare decision-making.

We will begin by exploring the concept of cost-effectiveness, a critical tool used by policymakers and healthcare providers to determine the most efficient allocation of resources. This section will explain how cost-effectiveness analysis aids in evaluating different healthcare interventions and choosing the most suitable options based on their costs and outcomes. We will then discuss cost-minimisation, which helps identify the least expensive method to achieve a health outcome.

Next, we will examine cost-utility analysis, a technique that compares interventions with different health outcomes by incorporating individual preferences and quality-of-life considerations. This will lead us to a discussion on measuring healthcare quality, where we will explore various performance indicators and assessment methods to evaluate the effectiveness and efficiency of healthcare systems.

Lastly, we will discuss sensitivity analysis, a crucial component of any health economic evaluation. This technique helps in understanding the robustness of the results by assessing the impact of uncertainties and variations in key parameters. By the end of this chapter, readers will have gained a comprehensive understanding of health economics and its vital role in shaping the future of healthcare systems worldwide.

References

• This introduction was written by ChatGPT4.0 and edited by Arnold Bosman
• Health Economics, by Jay Bhattacharya, Timothy Hyde, Peter Tu. Palgrave Macmillan. 2nd Edition. 2014. ISBN: 978-1137029966