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Cost Effectiveness
Jan J.V. Busschbach, Ph.D. Viersprong Institute for studies on Personality Disorders VISPD
Erasmus MC
Institute for Medical Psychology and Psychotherapy
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(Health) Economics
Comparing different allocations In health care: Should we spent our money on
• Wheel chairs
• Screening for cancer
Intervention in youth
• Jail
• Cure
• Prevention
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Assumptions
Agreement on the budget Assumption of scarcity
Agreement on outcome What are the intended effects
Possible to moves between budgets
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Economics in policy
Economics in policy are often Only Better effects for the same (or less) money
• “Doelmatigheid”
Efficiency improvement
Budget impact
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Car economics
Should we spend our money on a Suzuki Alto 1.0
BMW 316
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Car economics
Cost effectiveness Comparing costs
Comparing outcome
Relate costs to outcome Cost per outcome
Cost per kilometer
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League Table
Car € / Km Car € / Km
Suzuki Alto 1.0 0.24 Hyundai Lantra 1.5 0.47
Daihatsu Cuore 1.0 0.27 Opel Vectra 1.6 0.53
Hyundai Atos Multi 1.0 0.27 Citroën Xantia 1.8i 0.55
Renault Twingo 1.2 inj 0.28 Mazda 626 2.0 0.58
Daewoo Matiz 0.33 BMW 316 0.74
Cost per kilometre including gas, maintenance, debit, etc. Price level 2002. Calculations based on over 2,5 years use and 40.000 km. (Consumentenbond, Augustus 2003)
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Assumptions
Agreement on the budget Assumption of scarcity
Possible to moves between budgets We can buy a Suzkie or a BMW
Agreement on outcome What are the intended effects
The effects is restricted to ‘movement’
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Which costs included in CE youth intervention?
Costs of intervention Costs of alternatives
Jail
Other treatment
Costs of crime Material costs
Cost of law enforcement
Other savings Broken education
Intangible costs
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Intangible costs
What are the costs of Death
Suffering
Rape
Fear
No clear methodology Willingness to pay
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Which outcomes in youth interventions?
What is the aim of youth interventions? Costs per avoided crime Costs per contact
Prevention
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Effects expressed as costs
Cost Benefit analysis Effects can now be subtracted from costs
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Drivers in health economics
The effect of the intervention The cost of the intervention Intangible costs Discounting
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Changes of economics in youth interventions
The effect of the intervention The cost of the intervention
Alternative is expensive: Jail
Intangible costs The effects are warranted
Broken education
Discounting Sometime immediate effects
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Threats of economics in youth interventions
The effect of the intervention Low quality evidence on the effectiveness
A randomized trials is now the standard
The cost of the intervention Expensive labour-intensive
Intangible costs No consensus about these costs
Discounting Often effect are in the further: prevention
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Examples
The Washington State Institute for Public Policy Steve Aos, 2004
Taxpayer perspective: cost benefit analysis
Intangible costs used as effects (sexual abuse = $ 94,506)
The monetary value of saving a high-risk youth Cohen, 1998
Intangible costs: lifetime costs criminal career
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Little studies
Welsh & Farrington, 2000 “[…] little is known about the economic efficiency of
correctional intervention strategies. A review of the literature revealed only seven published studies that have presented information on monetary costs and benefits”.
Swaray et al, 2005 Found only 10 studies
The norm ‘evidence based’ is not near Research dominated by aetiology and epidemiology
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Encouraging results
Reviews show favorable results Cure is more cost effective than prevention
• Targeted prevention works better
Cure more cost effective than incarceration
No Dutch evidence Although The Netherlands is leading in health economics
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Conclusion
Economics are lacking Main obstacles
Convincible effect studies
The odds are favorable
