Abstract

The authors introduce economic evaluation with particular attention to cost-effectiveness analysis. They begin by establishing why health care decisions should be guided by economics. They then explore different types of economic evaluations. To illustrate how to conduct and evaluate a cost-effectiveness analysis, a hypothetical study about the treatment of posttraumatic stress disorder with psychotherapy versus pharmacotherapy is considered. The authors conclude with recommendations for increasing the strength and relevance of economic evaluations.

In this paper, we investigate the meaning of "affordability" in the context of health insurance. Assessing the relationship between the affordability of coverage and the large number of uninsured in the U.S. is important for understanding the barriers to purchasing coverage and evaluating the role of policy in reducing the number of uninsured. We propose several definitions of affordability and examine the implications of alternative definitions for estimates of the proportion of uninsured who are unable to afford coverage. We find that, depending on the definition, health insurance was affordable to between one-quarter and three-quarters of the uninsured in the United States in 2000.

This issue of CHP/PCOR's quarterly newsletter, which covers news from the spring 2006 quarter, includes articles about:

• a study led by CHP/PCOR trainee Hau Liu which found that teriparatide (Forteo) -- the first in a new class of osteoporosis drugs -- is not cost-effective compared with the most commonly prescribed osteoporosis drug, alendronate (Fosamax), due largely to teriparatide's much higher price;
• an update on projects and priorities at CADMA (the Center on Advancing Decision Making in Aging) and CDEHA (the Center on the Demography and Economics of Health and Aging), two multidisciplinary research centers based at CHP/PCOR that support promising early-stage projects on health, economics and aging;
• an April working trip by CHP/PCOR research assistants Meghan Fay and Raina Mahajan, in which they traveled to San Lucas Toliman, Guatemala, with faculty member Paul Wise, assisting him with various medical treatment and health promotion activities in the region; and
• a meta-analysis led by CHP/PCOR trainee Smita Nayak which evaluated the accuracy of an emerging screening test for osteoporosis -- heel ultrasound -- compared with the standard test, known as DXA. The study found that there is not enough evidence to recommend heel ultrasound over DXA as an osteoporosis screening tool.