Incremental and Average Cost‐Effectiveness Ratios: Will Physicians Make a Distinction?

John C. Hershey, David A. Asch, Christopher Jepson, Jonathan Baron and Peter A. Ubel

Risk Analysis, 2003, vol. 23, issue 1, 81-89

Abstract: Physicians are increasingly asked to use cost‐effectiveness information when evaluating alternative health care interventions. Little is known about how the way such information is presented can influence medical decision making. We presented physicians with hypothetical screening scenarios with multiple options, varying the type of cost‐effectiveness ratios provided as well as whether the scenarios described cancer screening settings that were familiar or unfamiliar. Half the scenarios used average cost‐effectiveness ratios, as commonly reported, calculating benefits and costs relative to a no‐screening option. The other half used the preferred incremental cost‐effectiveness ratios, with each option's benefits and costs calculated relative to the next best alternative. Relative to average cost‐effectiveness ratios, incremental cost‐effectiveness information significantly reduced preference for the most expensive screening strategies in two of three unfamiliar scenarios. No such difference was found for familiar scenarios, for which physicians likely have established practice patterns. These results suggest that, in unfamiliar settings, average cost‐effectiveness ratios as reported in many analyses reported in the literature can hide the often high price for achieving incremental health care goals, potentially causing physicians to choose interventions with poor cost effectiveness.

Date: 2003
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Persistent link: https://EconPapers.repec.org/RePEc:wly:riskan:v:23:y:2003:i:1:p:81-89

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