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Multiplier Effects and Compensation Mechanisms for Inclusion in Health Economic Evaluation: A Systematic Review

Author

Listed:
  • Marieke Krol

    (Erasmus University Rotterdam
    IQVIA)

  • Nikkie Hosseinnia

    (Erasmus University Rotterdam
    Utrecht University)

  • Werner Brouwer

    (Erasmus University Rotterdam
    Erasmus University Rotterdam)

  • Leona Hakkaart Roijen

    (Erasmus University Rotterdam
    Erasmus University Rotterdam)

Abstract

Background Compensation mechanisms and multiplier effects may affect productivity losses due to illness, disability, or premature death of individuals. Hence, they are important in estimating productivity losses and productivity costs in the context of economic evaluations of health interventions. This paper presents a systematic literature review of papers focusing on compensation mechanisms and multiplier effects, as well as whether and how they are included in health economic evaluations. Methods The systematic literature search was performed covering EconLit and PubMed. A data-extraction form was developed focusing on compensation mechanisms and multiplier effects. Results A total of 26 studies were included. Of these, 15 were empirical studies, three studies were methodological studies, two studies combined methodological research with empirical research, four were critical reviews, one study was a critical review combined with methodological research, and one study was a cost–benefit analysis. No uniform definition of compensation mechanisms and multiplier effects was identified. The terminology used to describe compensation mechanisms and multiplier effects varied as well. While the included studies suggest that both multipliers as well as compensation mechanisms substantially impact productivity cost estimates, the available evidence is scarce. Moreover, the generalizability as well as validity of assumptions underlying the calculations are unclear. Available measurement methods for compensation mechanisms and multiplier effects differ in approaches and are hardly validated. Conclusion While our review suggests that compensation mechanisms and multiplier effects may have a significant impact on productivity losses and costs, much remains unclear about their features, valid measurement, and correct valuation. This hampers their current inclusion in economic evaluation, and therefore, more research into both phenomena remains warranted.

Suggested Citation

  • Marieke Krol & Nikkie Hosseinnia & Werner Brouwer & Leona Hakkaart Roijen, 2023. "Multiplier Effects and Compensation Mechanisms for Inclusion in Health Economic Evaluation: A Systematic Review," PharmacoEconomics, Springer, vol. 41(9), pages 1031-1050, September.
    • Handle: RePEc:spr:pharme:v:41:y:2023:i:9:d:10.1007_s40273-023-01304-4
    DOI: 10.1007/s40273-023-01304-4
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    References listed on IDEAS

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    1. Hensher, Martin & Tisdell, John & Canny, Ben & Zimitat, Craig, 2020. "Health care and the future of economic growth: exploring alternative perspectives," Health Economics, Policy and Law, Cambridge University Press, vol. 15(4), pages 419-439, October.
    2. Sean Nicholson & Mark V. Pauly & Daniel Polsky & Claire Sharda & Helena Szrek & Marc L. Berger, 2006. "Measuring the effects of work loss on productivity with team production," Health Economics, John Wiley & Sons, Ltd., vol. 15(2), pages 111-123, February.
    3. Krol, Marieke & Brouwer, Werner B.F. & Severens, Johan L. & Kaper, Janneke & Evers, Silvia M.A.A., 2012. "Productivity cost calculations in health economic evaluations: Correcting for compensation mechanisms and multiplier effects," Social Science & Medicine, Elsevier, vol. 75(11), pages 1981-1988.
    4. Karen L. Sedatole & Amy M. Swaney & Alexander Woods, 2016. "The Implicit Incentive Effects of Horizontal Monitoring and Team Member Dependence on Individual Performance," Contemporary Accounting Research, John Wiley & Sons, vol. 33(3), pages 889-919, September.
    5. Zhang, Wei & Bansback, Nick & Anis, Aslam H., 2011. "Measuring and valuing productivity loss due to poor health: A critical review," Social Science & Medicine, Elsevier, vol. 72(2), pages 185-192, January.
    6. Karin H. M. Jacob‐Tacken & Marc A. Koopmanschap & Willem Jan Meerding & Johan L. Severens, 2005. "Correcting for compensating mechanisms related to productivity costs in economic evaluations of health care programmes," Health Economics, John Wiley & Sons, Ltd., vol. 14(5), pages 435-443, May.
    7. Mark V. Pauly & Sean Nicholson & Judy Xu & Dan Polsky & Patricia M. Danzon & James F. Murray & Marc L. Berger, 2002. "A general model of the impact of absenteeism on employers and employees," Health Economics, John Wiley & Sons, Ltd., vol. 11(3), pages 221-231, April.
    8. Brouwer, W. B. F. & van Exel, N. J. A. & Koopmanschap, M. A. & Rutten, F. F. H., 2002. "Productivity costs before and after absence from work: as important as common?," Health Policy, Elsevier, vol. 61(2), pages 173-187, August.
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