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Cost–effectiveness analysis is the heading of a set of statistical methodologies for evaluating medical treatments. It is required that the evaluation be based on the effectiveness and cost of the treatments. As the effectiveness and cost change across the patient population to which a given treatment is applied, it is assumed that they are random variables for which a statistical model has to be proposed. In this setting, the aim of the analysis is that of choosing the “optimal” treatment in a specified set of alternative treatments for a given disease whose cost and effectiveness follow specified statistical models.
The interest in cost–effectiveness analysis has grown in the last three decades, and the literature on the topic is spread out in scientific journals that include the European Journal of Health Economics, European Journal of Operational Research, Health Economics, Journal of Health Economics, Medical Decision Making, Pharmacoeconomics and Value in Health. A few books, including Briggs et al. (2006), Willan and Briggs (2006), Baio (2012) and Drummond et al. (2015), put together the advancements in different aspects of cost–effectiveness analysis to date. This book provides the basis of statistical decision theory and methods required for the cost–effectiveness analysis and is aimed at students of health economics with a solid background in statistics, applied statisticians, researchers in health economics, and health managers.
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