Hypothetical versus real willingness to pay in the health care sector: results from a field experiment.

We conducted a field experiment comparing hypothetical and real purchase decisions for a pharmacist provided asthma management program among 172 subjects with asthma. Subjects received either a dichotomous choice contingent valuation question or were given the opportunity to actually enroll in the program. Three different prices were used: US$ 15, 40, and 80. In the hypothetical group, 38% of subjects said that they would purchase the good at the stated price, but only 12% of subjects in the real group purchased the good (p = 0.000). We cannot, however, reject the null hypothesis that "definitely sure" hypothetical yes responses, as identified in a follow-up question, correspond to real yes responses. We conclude that the dichotomous choice contingent valuation method overestimates willingness to pay, but that it may be possible to correct for this overestimation by sorting out "definitely sure" yes responses.

On hypothetical bias and calibration in cost-benefit studies.

Despite a sound foundation in economic welfare theory, willingness to pay (WTP) has not been used as a measure of benefits in economic evaluations of health and health care to the same extent as in other fields. Some have suggested that this is due to non-economists' reluctance to placing dollar values on the benefits of health care. However, another potential reason could be uncertainties about the validity of the WTP measure. In this paper, we outline the bias problems with the WTP method, and specifically focus on hypothetical bias; i.e. whether the WTP from hypothetical elicitation methods overstates the real WTP or not. This is done by examining the literature in this field, with emphasis on economic experiments where there is a greater possibility for comparison. The findings are that hypothetical WTP in general significantly overestimates real WTP, but that calibration methods to reduce or eliminate this difference are currently being developed. We conclude that while the area is still very much under development, there seem to be reasons to view the use of cost-benefit analysis as a reasonable alternative to the more common cost-effectiveness analysis.

Azithromycin versus erythromycin for community-acquired pneumonia: a cost-minimization analysis.

The costs of i.v. erythromycin versus azithromycin (in terms of medication use and treatment of adverse effects) when these drugs were used with other antimicrobials to treat community-acquired pneumonia (CAP) were compared. The medical records of patients receiving i.v. azithromycin or erythromycin as part of combination antimicrobial therapy for the treatment of CAP at a 473-bed level 1 trauma center in Kentucky were retrospectively reviewed. Data were collected for patients treated from December 1, 1997, through March 31, 1998. Patient data collected included occurrence of phlebitis or pain at the injection site, number of line changes due to phlebitis, and culture results. Cost data collected included drug acquisition cost, pharmacy cost of drug preparation, nursing time to administer the agent, cost of drug supplies, and cost of managing complications. Three time-and-motion studies were conducted to determine technician preparation time and pharmacist verification time. The medical records of 62 patients were identified and reviewed; 50 patients were enrolled in the study (25 in the azithromycin group and 25 in the erythromycin group). The average total days of therapy was 5.1 for the azithromycin group and 5.6 for the erythromycin group. The average total cost, including the cost of complications ($4.36 per patient in the erythromycin group), was $66.46 in the azithromycin group and $96.56 in the erythromycin group. The difference in costs between the two groups was not significant. There was no significant cost difference between azithromycin- and erythromycin-containing combination antimicrobial therapy in the treatment of CAP.

Use of contingent valuation to place a monetary value on pharmacy services: an overview and review of the literature.

An important goal for the pharmacy profession is to quantify the economic value of pharmacy services. The contingent valuation (CV), or willingness-to-pay method, offers one approach to valuing the benefits of pharmacy services. The potential advantage CV offers is that it reflects, in a single monetary amount, the entire range of attributes (both benefits and "nonbenefits") offered by the good or service being valued. This paper provides a brief overview of the CV method and reviews 10 published studies that used a willingness-to-pay question to place a monetary value on pharmacy services. Suggestions for other researchers wishing to use this method are provided.

Relationship between quality of life instruments, health state utilities, and willingness to pay in patients with asthma.

BACKGROUND: In asthma, a substantial impact of disease is on quality of life rather than survival. To date, the quality of life effects of asthma have not been quantitated. OBJECTIVE: The purpose of this study was to quantitate the quality of life effects of asthma via measurement of the health utility of asthmatic patients, and the willingness to pay for an asthma cure. A second goal was to analyze how these measures are related to the different dimensions of quality of life as measured by general and disease specific quality of life instruments. METHODS: Health utilities were measured on a scale between 0 and 1 using the rating scale, time trade off, and standard gamble methods. Willingness to pay was elicited using both the dichotomous choice and the bidding game approach. Quality of life was assessed using both a generic instrument (the SF-36) and a disease-specific instrument (the Asthma TyPE). RESULTS: Sixty-nine patients with asthma were surveyed. The mean health utility was 0.68 with the rating scale method, 0.89 with the time trade off, and 0.91 with the standard gamble. On average, patients were willing to pay between $200 to $350 dollars more per month for an asthma cure. Nearly all correlations between dimensions of quality of life, health state utilities, and willingness to pay were in the expected direction. CONCLUSION: The two quality of life instruments performed about equally well in terms of being correlated with and being able to explain the responses to the health state utility questions and the willingness to pay questions. Correlations between the dimensions of the Asthma TyPE and the SF-36 were also fairly high. Further work should focus on validating and refining the different methods of quantitating quality of life for asthma patients.

An experimental test of question framing in health state utility assessment.

In the standard gamble and time trade-off methods of health state utility assessment, a specified health state and an alternative are compared. This alternative can be framed in terms of a loss or a gain in reference to the first health state. In this paper, we test whether this framing affects the estimated health state utilities. The experiment was carried out on a group of pharmacy students, randomly divided between the loss or gain version (n = 182). The null hypothesis of no difference between the loss and gain versions is rejected for the standard gamble method, but not for the time trade-off method.

Intra-arterial urokinase versus surgery for acute peripheral arterial occlusion.

The outcomes of intra-arterial urokinase versus surgery for acute peripheral arterial occlusion (PAO) were compared. Patients at a university hospital who had received intraarterial urokinase for PAO were identified by computer and pair-matched on the basis of comorbidities, age, sex, and site of occlusion to computer-selected patients who had undergone surgery. Only patients with category I or II ischemia were considered. The study period for the urokinase group was February 1995 through January 1996, and the period for the surgery group was June 1993 through January 1996. Twenty-eight patients in each group met the selection criteria. Patients who had received urokinase had a significantly shorter median length of stay (8.5 days) than patients in the surgery group (13 days) and significantly fewer infectious complications (2 versus 10). No differences in amputation rates, total hospital costs, or mortality rates were detected. Patients who received intra-arterial urokinase for PAO had a shorter length of stay in the hospital and fewer infectious complications than those who underwent surgery.

Economic evaluation in healthcare. A brief history and future directions.

Over the last decade there has been tremendous interest in economic evaluations of healthcare programmes, especially in the pharmaceutical field. Economic evaluations started about 30 years ago as rather crude analyses, in which the value of improved health was measured in terms of increased labour production. Now, more refined methods are available to measure health changes in terms of quality-adjusted life-years gained or willingness to pay. It is important to continue this development, and major fields for future work include the incorporation of quality-of-life measurements into economic evaluations and the linking of cost-effectiveness and cost-benefit analyses into a unified framework of economic evaluation. How to incorporate distributional issues is another important area. Finally, it seems crucial to further explore the link between economic evaluation and decision making, since the purpose of economic evaluations is to affect decision making.

Incorporating quality of life changes into economic evaluations of health care: an overview.

The demand for economic evaluations of health care programs, especially pharmaceuticals, is steadily increasing. One of the most important issues in this field is how to measure, value and incorporate changes in quality of life into the economic evaluation. We provide an overview of the different approaches to measure changes in quality of life: quality of life instruments, the quality-adjusted life-year (QALY) approach and the willingness to pay approach. Quality of life instruments have major practical advantages since they are easy to administer. The results of these instruments cannot, however, be used in economic evaluations. In economic evaluations, the quality of life has to be measured on the 0 (death) to 1 (full health) scale necessary to construct QALYs, or the willingness to pay for the changes in quality of life has to be measured. Such measurements are, however, much less straightforward to carry out. It would therefore be a major advance if it would be possible to directly translate the quality of life score into a QALY weight or the willingness to pay. It is recommended that more systematic research should be carried out on the relationship between quality of life, QALY weights, and willingness to pay.