EconPapers    
Economics at your fingertips  
 

On a simple quickest detection rule for health-care technology assessment

Daniele Bregantini and Jacco J.J. Thijssen

Discussion Papers from Department of Economics, University of York

Abstract: In this paper we propose a solution to the Bayesian problem of a decision maker who chooses, while observing trial evidence, an optimal stopping time at which either to invest in a newly developed health care technology or abandon research. We show how optimal stopping boundaries can be computed as a function of the observed cumulative net benefit derived from the new health care technology. At the optimal stopping time, the decision taken is optimal and the decision maker either invest or abandon the technology with consequent health benefits to patients. The model takes into account the cost of decision errors and explicitly models these in the payoff to the heath care system. The implications in terms of opportunity costs of decisions taken at sub-optimal time is discussed and put in the value of information framework. In a case study it is shown that the proposed method, when compared with traditional ones, gives substantial economic gains both in terms of QALYs and reduced trial costs.

Keywords: Optimal stopping; HTA; Bayes; Value of Information (search for similar items in EconPapers)
JEL-codes: C11 C12 C44 (search for similar items in EconPapers)
Date: 2014-01
New Economics Papers: this item is included in nep-hea and nep-ict
References: View references in EconPapers View complete reference list from CitEc
Citations:

Downloads: (external link)
https://www.york.ac.uk/media/economics/documents/discussionpapers/2014/1401.pdf Main text (application/pdf)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:yor:yorken:14/01

Access Statistics for this paper

More papers in Discussion Papers from Department of Economics, University of York Department of Economics and Related Studies, University of York, York, YO10 5DD, United Kingdom. Contact information at EDIRC.
Bibliographic data for series maintained by Paul Hodgson ().

 
Page updated 2024-05-10
Handle: RePEc:yor:yorken:14/01