Health Economics: An Introduction

Overview

• This lecture provides an unconventional look at health economics.
• Economics is described as the science of decision-making regarding resource allocation.
• Important for individuals, companies, NGOs, UN agencies, and countries.

Key Definitions

• Economics: The science of how decisions are made about the allocation of resources, not limited to money.
• Health Economics: Focuses on decisions affecting health, using economic principles to understand these decisions.

Role of Economics in Health

1. Individual Level

   • Daily lifestyle choices: diet, exercise, healthcare access.
   • Decisions weigh value and expected outcomes against alternatives.

2. Healthcare Providers and Companies

   • Decisions on pricing and quantity of healthcare products and services.
   • Price setting influenced by production costs.

3. Government

   • Budget allocation aimed at maximizing benefits and ensuring distributive justice.
   • Decisions on healthcare provision: private vs. free at point of service.

4. NGOs and Funding Agencies

   • Resource allocation for maximum impact.
   • Use of cost per Disability Adjusted Life Year (DALY) averted for intervention evaluation.

Cost-Effectiveness Examples

• Trachoma Treatment: Cost is $30-$40 per DALY averted.
• Schizophrenia Treatment: Cost is $6,000 per DALY averted.
• Economic decisions should consider actual disease incidence.

Importance of Health Economic Data

• Most effective when combined with epidemiological data.
• Cost-effectiveness is crucial but not the only decision-making factor.

Additional Resources

• Future video on health policy and decision-making regarding healthcare spending.
• Related topics on channel: distributive justice, job opportunities in global health, study designs.

Further Learning

• Engage with DCP3 for more on economic evaluation for health priorities.
• Subscribe to the channel for more insights on global health.