Bayesian Cost-Effectiveness Analysis of Medical Treatments

Abstract

Cost-effectiveness analysis is becoming an increasingly important tool for decision making in the health systems. Cost-Effectiveness of Medical Treatments formulates the cost-effectiveness analysis as a statistical decision problem, identifies the sources of uncertainty of the problem, and gives an overview of the frequentist and Bayesian statistical approaches for decision making. Basic notions on decision theory such as space of decisions, space of nature, utility function of a decision and optimal decisions, are explained in detail using easy to read mathematics. Features

Focuses on cost-effectiveness analysis as a statistical decision problem and applies the well-established optimal statistical decision methodology.

Discusses utility functions for cost-effectiveness analysis.

Enlarges the class of models typically used in cost-effectiveness analysis with the incorporation of linear models to account for covariates of the patients. This permits the formulation of the group (or subgroup) theory.

Provides Bayesian procedures to account for model uncertainty in variable selection for linear models and in clustering for models for heterogeneous data. Model uncertainty in cost-effectiveness analysis has not been considered in the literature.

Illustrates examples with real data.

In order to facilitate the practical implementation of real datasets, provides the codes in Mathematica for the proposed methodology.

The motivation for the book is to make the achievements in cost-effectiveness analysis accessible to health providers, who need to make optimal decisions, to the practitioners and to the students of health sciences.