Public Health Economics and Tools
Public Health Economists and Methods
CDC employs more than 60 doctoral level health economists, more than any federal agency. CDC health economists published over 100 peer-reviewed articles in 2012 alone, yet many public health professionals are not familiar with their work.
Economics is the study of decisions, the incentives that lead to them, and the consequences that result from them—as they relate to present and future production, distribution, and consumption of goods and services when resources are limited and have alternative uses. CDC uses economics to systematically identify, measure, value, and compare the costs and consequences of alternative prevention strategies. This short article published in MMWR presents a definition of public health economics and a short overview of its use at CDC.
Health economists use the following general methods:
- Cost analysis refers to the systematic collection, categorization, and analysis of intervention/program costs, side effects costs (or externalities), and illness costs. CDC economists have explored the costs of different types of cancers, hospital-acquired infections, communicable diseases, and even the costs of an outbreak investigation for local health departments.
- Economic evaluations provide a systematic approach for assessing and comparing two or more interventions or programs in terms of their respective costs or benefits and includes cost-effectiveness, cost-benefit, and cost-utility analyses. CDC economists recently performed economic evaluations on screening options for diabetes, diagnostic options for HIV and TB, vaccine strategies, TB treatment regimes, and injury prevention programs.
- Decision and transmission modeling includes developing and testing various models such as simple regression models, Markov decision choice models, agent-based models, simulations, and theoretical mathematical models. CDC economists have performed modeling on vaccine strategies, HIV diagnosis and treatment alternatives, and state public health resource allocation options.
- Regulatory analysis is a tool regulatory agencies use to anticipate and evaluate the likely consequences of rules. The impact of regulations on costs and/or behaviors becomes increasingly more important as health protection is further emphasized in public health. Highlights from CDC economists' work in this area include an analysis of the removal of HIV infection from the definition of communicable diseases of public health significance and the impact of regulations requiring pre-travel medical consultation for international travelers.
Members of the public health community are encouraged to make use of the following tools for improving practices around the evaluation of health costs and burden, and health program effectiveness and efficiency. These tools have been created by CDC and its partners. CDC health economists are continually working on new tools, which will be added to this collection.
+ Chronic Disease
Chronic Disease Cost Calculator
The Chronic Disease Cost Calculator was designed to help states estimate the burden and financial impact of chronic diseases among their Medicaid beneficiaries. The downloadable tool supports states in estimating state Medicaid expenditures for six chronic diseases (congestive heart failure, heart disease, stroke, hypertension, cancer, and diabetes) and generating estimates of the costs to Medicaid for selected chronic diseases using customized inputs, such as prevalence rates and treatment costs.
Obesity Cost Calculator
The Obesity Cost Calculator uses input data provided by human resources or benefits personnel to calculate an estimate of organization costs related to obesity and to compare the costs and benefits of user-defined interventions targeted at reducing obesity. More specifically, the Obesity Cost Calculator estimates the costs of obesity based on characteristics of the organization (including costs for medical expenditures and the dollar value of increased absenteeism resulting from obesity), and provides a module to assess expected savings of interventions to reduce obesity, potential reductions in medical costs and work loss resulting from interventions, and the number of years before a break-even period is reached. Each is estimated under several user-driven scenarios concerning the expected costs and savings resulting from the intervention.
+ Economic Evaluation
Department of Health and Human Services Guide to
Analyzing the Cost-Effectiveness of Community Public
Health Prevention Approaches
The Guide to Analyzing the Cost-Effectiveness of Community Public Health Prevention Approaches provides practical advice to help program managers and evaluators understand, design, and perform cost-effectiveness (CE) evaluations of community public health prevention programs.
Department of Veterans Affairs Health Economics
The Health Economics Resource Center (HERC) assists VA researchers in assessing the cost-effectiveness of medical care, evaluating the efficiency of VA programs and providers, and conducting high-quality health economics research. HERC course archives and alternatives for non-VA researchers may also be useful to state, tribal, local, and territorial public health agency staff interested in learning more about cost data and economic research.
Economic Evaluation of Public Health
Laws and their Enforcement
This monograph examines the methods for economic evaluation of public health laws and their enforcement. For example, wearing a helmet substantially decreases a motorcyclist’s risk of death or severe injury in a crash and decreases the associated costs, most of which are not borne by the motorcyclist. Yet legislation mandating helmet wearing while motorcycling is seen to restrict freedom of choice and deprive motorcyclists of the perceived pleasure of riding without a helmet. This document provides an overview of the inherent tensions that exist when laws or regulations restrict activities harmful to health, with trade-offs required between the good of the whole community versus the good of an individual. Economic evaluation methods are explained to help decision makers and the general public understand likely effects on different sectors of the community.
Economic Impact Analysis Tool
The Economic Impact Analysis tool developed by HRSA/Office of Rural Health Policy (ORHP) in partnership with The Lewin Group and the University of Washington Rural Health Research Center, is an easy-to-use, scientifically valid tool, that can help communities quantify the economic and service impact of their programmatic investments. This free, online tool allows community programs to assess their own performance and use the data to leverage additional resources for the long-term sustainability of the program. In addition, the tool helps translate project-specific impacts into community-wide effects including the new health and community services provided; number of jobs created; wages earned; and the overall impact in the economy. ORHP launched the tool in June, 2011. It is currently available on the Rural Assistance Center’s site.
CommunityFlu 1.0 was designed to simulate the spread of influenza through a model community and assess the impact of a variety of potential interventions (e.g., vaccinations, school closings, wearing of face masks, patient and household isolation/self quarantine). The tool also provides estimates for the number of cases, hospitalizations, and deaths that may be seen among different age groups found in a representative community. CommunityFlu 1.0 allows a user to estimate the economic impact, in terms of days of work lost, of an influenza epidemic/pandemic in a community, thus calculating the savings and costs associated with one or more interventions.
FluAid 2.0 was designed to assist state- and local-level planners in preparing for the next influenza pandemic by providing estimates of the potential impact specific to their locality. This tool provides a range of impact estimates in terms of deaths, hospitalizations, and outpatients visits due to pandemic influenza. Due to the heightened awareness during the 2009 H1N1 Response, FluAid 2.0 was adapted so states and public health planners could estimate the state-level impact of the 2009 H1N1 Influenza A using spring 2009 H1N1 collected data.
FluLabSurge 1.0 was designed to assist laboratory directors with estimating the demand for specimen testing during an influenza pandemic and public health lanners in developing pandemic response plans. This tool generates estimates for the daily number of specimens that may be delivered to a laboratory for testing and evaluates the testing capacity of a specific laboratory (e.g., how many samples can be tested per day or work shift) per pandemic transitional day found in each of the pandemic stages. FluLabSurge 1.0 produces a one-page plan showing how capacity will be used to meet user-defined testing goals (e.g., surveillance, strain identification, clinical diagnostics).
FluSurge 2.0 was designed to provide hospital administrators and public health officials with estimates of the surge in demand for hospital-based services during an influenza pandemic. This tool estimates the number of hospitalizations and deaths of an influenza pandemic (whose length and virulence are determined by the user) and the number of persons hospitalized, requiring ICU care, and requiring ventilator support during a pandemic with existing hospital capacity. FluSurge 2.0 was adapted to provide hospital administrators and public health officials with estimates of the surge demand for hospital-based services during the 2009 H1N1 Influenza event.
FluWorkLoss 1.0 was designed to estimate the potential number of days lost from work due to an influenza pandemic. This tool provides a range of estimates for the total number of workdays lost, as well as graphic illustrations of the workdays lost by week and percentage of total workdays lost to influenza-related illnesses. Due to the heightened awareness during the 2009 H1N1 response, it was adapted to estimate the total number of workdays that could be lost as a specific result of the 2009 H1N1 Influenza A event.
+ Public Health Preparedness
Maxi-Vac 1.0 and Maxi-Vac Alternative
Maxi-Vac 1.0 and Maxi-Vac Alternative were designed to be used by state and local public health officials to assist with planning large-scale smallpox vaccination clinics with maximum patient flow-through. Users can select the number and type of professional resources available to operate a clinic (e.g., physicians, nurses) and the software will allocate those staff among the pre-designated required activities, optimizing clinic operations.
MedCon:Pre-Event has been designed to estimate the baseline medical care requirements (i.e., the number of persons that would require medical care) of a displaced population following a disaster due to pre-existing medical conditions. MedCon:Pre-Event has not been designed for estimating the medical care requirements due to direct impact of the event (e.g., injuries and illness) or additional medical care requirements resulting from the aggravation of the existing medical condition. This tool will be useful for public health preparedness planners at local, state, and federal levels involved in addressing the large-scale medical care requirements resulting from man-made and natural disasters.
HIV Economic Model: HIVEcon
HIV Economic Model (HIVEcon) was developed to help assess all costs and benefits of the proposed rule change to remove HIV infection from U.S. immigration screening [PDF-160KB]. The objective of HIVEcon is to evaluate both the potential number of HIV-positive immigrants to the United States and the health system cost over time, given a change in regulation.+
Five-Part Webcast on Economic Evaluation
This Five-Part Webcast on Economic Evaluation from CDC’s National Heart Disease and Stroke Prevention helps public health practitioners understand the value of economic evaluation and choose the appropriate economic analysis for their program or policy needs.
National Institutes of Health, U.S. National Library
of Medicine Health Economics Online Course
This Health Economics online self-study course describes the scope of health economics and key information resources, highlights the sources and characteristics of health care financing information in the U.S., outlines issues relating to the quality of health economic evaluation studies, and guides users in the identification, retrieval, and assessment of high quality health economic evaluation studies and related publications. The purpose of this course is to provide an overview and discussion of important sources of health economics information.
CDC Steven M. Teutsch Prevention Effectiveness
The PE Fellowship is a two-year, post-doctoral, applied training program established to address demand in the public health field for economics-based inquiry, quantitative policy analysis, and integrative health services research. The primary goal of the PE Fellowship is to provide information for health policy decision-makers regarding allocation and use of resources to maximize health impact.
CDC Economic Evaluation of Public Health
Preparedness and Response Efforts
The Economic Evaluation of Public Health Preparedness and Response Efforts educational series is designed as an introductory course on applying economic evaluation techniques to public health preparedness and response strategies. This course is targeted to meet the needs of public health professionals at the federal, state, or local level and includes the following tutorials: introduction to economic evaluation, framing an economic evaluation, cost analysis, cost effectiveness analysis, and cost benefit analysis.
SurvCost is a spreadsheet-based tool developed to aid public health officials in estimating the cost of Integrated Disease Surveillance and Response (IDSR) systems at national, region/province, district, and health facility. SurvCost estimates the costs of seven categories of resources: personnel, office operating items, transportation, laboratory materials and supplies, treatment and programmatic response items, media or public awareness campaigns, and capital items. The estimates of costs by category allow surveillance system managers to better understand the resources required to operate IDSR systems. SurvCost may also be of use to managers of other disease surveillance systems who wish to estimate their costs.
+ Policy Analysis
Mechanisms of Legal Effect: Perspectives from
Over the past few decades, health economists have made substantial contributions to our understanding of how laws, regulations, and other policies can address market failures in order to improve public health. Mechanisms of Legal Effect: Perspectives from Economics provides an introduction to the concepts used by economists in this research. This monograph begins by providing a discussion of the economic rationale for government intervention in a variety of markets where individual behaviors lead to public health consequences. It discusses policy interventions that address these market failures, beginning with demand-side approaches to promoting public health through legal interventions and emphasizing the concept of the "full price" of consumption. It also reviews legal approaches to addressing the supply side of these markets.
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