Reference no: EM133196556

Assignment:

Reading the chapter: COST-EFFECTIVENESS ANALYSIS

Part A: Incremental Cost-Effectiveness Ratio

This assignment has you redo the example presented on pages 182-189 of Bernell, but with several changes. Make the following changes to the decision tree on page 184. Please note that any change in a probability affects two probabilities, as the sum of the probabilities at a chance node must sum to 1.0.

Original value	Value for assignment
Unvaccinated branch
Pr(remains well)	0.90	0.85
Pr(recovers, so doesn't see doctor)	0.80	0.70
Cost of seeing doctor	$100	$150
Pr(recovers, given that sees doctor)	0.99	0.95
Cost of hospitalization	$5000	$7500
Vaccinated branch
Cost of vaccine	$50	$60
Pr(remains well)	0.97	0.95
Pr(recovers, so doesn't see doctor)	0.90	0.88
Cost of seeing doctor	$100	$150
Pr(recovers, given that sees doctor)	0.999	0.98
Cost of hospitalization	$5000	$7500

Make the following changes to Exhibits 9.6 and 9.7 (these changes will flow through the tables; you will need to make those changes):

Age	Survivors, Exhibit 9.6	Deaths, Exhibit 9.6	Survivors, Exhibit 9.7	Deaths, Exhibit 9.7
95	100	22	100	6
96	78	15	94	16
97	63	11	78	11
98	50	7	67	6
99	45	2	61	1

You will need to record the following in Moodle:

1. Expected cost of supportive care ($3 in Bernell example).

2. Expected cost of vaccine ($50.32 in Bernell example)

3. Effectiveness of supportive care (183.8 in Bernell example; 183.9 with no rounding errors)

4. Effectiveness of the vaccine (229.23 in Bernell example; 219.83 with no rounding errors)

5. ICER ($104.16 in the Bernell example; 131.70 with no rounding errors)

So that you can match what you are trying to calculate with the Bernell example, the values shown in Bernell are given above. Since Bernell has incorrectly rounded some intermediate calculations, there are some rounding errors. The corrected values without rounding errors are also given above. You should set this up in Excel so that you can duplicate the correct values. Then you can change the values to reflect the parameters for this assignment.

Part B: ICER with Discounting

Outcomes that occur in the future are often discounted back to the present. Make the following change to the calculation of the effectiveness of supportive care and the vaccine: in Exhibits 9.6 and 9.7 (this also appears in 9.8 and 9.9) apply a discount rate of 3% (0.03) to future person-years. Discount these back to a present value at age 95. Given this change recalculate:

6. Effectiveness of supportive care (176.40 if you use Bernell's values)

7. Effectiveness of the vaccine (210.34 using Bernell's values)

8. ICER (139.38 using Bernell's values).