ECP-4530 Lecture Notes - Lecture 9: Indirect Costs, Disability-Adjusted Life Year, Human Capital
Document Summary
Scope of study: cba: considers costs and benefits of a single action, cea: compares costs of multiple actions, cost-effective analysis. Often use when the benefits of a policy are clearly defined and deemed desirable. Do not have to put a dollar value on life or quality of life: measuring cost. Included: direct costs, health care costs: costs incurred by medical care providers such as hospitals, physicians, and nursing homes, non-health care costs: monetary costs imposed on any nonmedical personnel, including patients. Indirect costs the time cost associated with implementation of the treatment, mortality or morbidity. Costs are discounted when multiple time periods are involved. Usually omitted: pain and suffering : quality-adjusted life years. Adjusts a life year for quality, taking into account that not all life years are created equal. Quality of life index (or health utility index: takes values [0, 1, 0 is immediate death, 1 is one year of perfect health.
