Cost-Effective Analysis: The mathematical inequalities of health

A fundamental issue in global healthcare is quantifying health in order to allocate limited resources most effectively. The heart of the issue is the reality that resource allocation and distribution involves human lives in exchange for other human lives. In order to circumvent ethical issues cost-effective analysis serves as a detached, calculated determination of the burden of disease. Cost- effectiveness is a method that determines health-related gains and the corresponding costs of such interventions. The method ignores any non-health related factors and therefore ignores the human quality that is innate in human health.

Unlike the notorious DALY approach, cost-effective ratios look primarily at both prevention and treatment as the integral factor in the calculation of health. It is more black and white and consequently evades various ethical issues1. Although cost-effectiveness appears to the most rational method of resource allocation determination there is a core conflict. Smaller, less severe health issues with a more successful outcome will generally prove more cost-effective then life-saving treatments. An example that Darshak Sanghavi mentions in  “Cost effective to treat the poor” is treatment for thumb-sucking in Oregon in competition with AIDS treatment in Africa. While thumb-sucking intervention will have quantifiable success AIDS treatment in Africa will necessarily be less cost-effective 2.

There may be superior method to measure health. Yet, the solution is not to divorce health from its master- life. Stitched into the calculations of whose life will be most efficient to save is the reality that cost-effectiveness is not necessarily the most humane perspective. The reality is successfully yet minimally improving the lives of a large number of people is not the mathematical equivalent of actually saving the lives of a smaller group of dying persons. Resource allocation must aim to carve a whole in the global burden of disease not just skim the border.

1 Jamison et al – “Cost effectiveness analysis”. Chapter 3. 2006.

2 Sanghavi, Darshak. “Cost effective to treat the poor”.2007.


One response to “Cost-Effective Analysis: The mathematical inequalities of health

  1. Pingback: HIV / AIDS Treatment » Cost-Effective Analysis: The mathematical inequalities of health …

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