IDEAS home Printed from https://ideas.repec.org/a/wly/hlthec/v9y2000i3p227-234.html
   My bibliography  Save this article

Power and sample assessments for tests of hypotheses on cost‐effectiveness ratios

Author

Listed:
  • Joseph C. Gardiner
  • Marianne Huebner
  • James Jetton
  • Cathy J. Bradley

Abstract

We address the issue of statistical power and sample size for cost‐effectiveness studies. Tests of hypotheses on the cost‐effectiveness ratio (CER) are constructed from the net cost and incremental effectiveness measures. When the difference in effectiveness is known, we derive formulae for statistical power and sample size assessments for one‐ and two‐sided tests of hypotheses of the CER. We also construct a test of the joint hypothesis of cost‐effectiveness and effectiveness and derive an expression connecting power and sample size. Our methods account for the correlation between cost and effectiveness and lead to smaller sample size requirements than comparative methods that ignore the correlation. The implications of our formulae for cost‐effectiveness studies are illustrated through numerical examples. When compared with trials designed to demonstrate effectiveness alone, our results indicate that a trial appropriately powered to demonstrate cost‐effectiveness might require sample sizes many times greater. Copyright © 2000 John Wiley & Sons, Ltd.

Suggested Citation

  • Joseph C. Gardiner & Marianne Huebner & James Jetton & Cathy J. Bradley, 2000. "Power and sample assessments for tests of hypotheses on cost‐effectiveness ratios," Health Economics, John Wiley & Sons, Ltd., vol. 9(3), pages 227-234, April.
    • Handle: RePEc:wly:hlthec:v:9:y:2000:i:3:p:227-234
    DOI: 10.1002/(SICI)1099-1050(200004)9:3<227::AID-HEC509>3.0.CO;2-Z
    as

    Download full text from publisher

    File URL: https://doi.org/10.1002/(SICI)1099-1050(200004)9:33.0.CO;2-Z
    Download Restriction: no
    File URL: https://libkey.io/10.1002/(SICI)1099-1050(200004)9:3<227::AID-HEC509>3.0.CO;2-Z?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    References listed on IDEAS

    as
    1. Tambour, Magnus & Zethraeus, Niklas & Johannesson, Magnus, 1997. "A Note on Confidence Intervals in Cost-Effectiveness Analysis," SSE/EFI Working Paper Series in Economics and Finance 181, Stockholm School of Economics.
    2. Daniel Polsky & Henry A. Glick & Richard Willke & Kevin Schulman, 1997. "Confidence Intervals for Cost–Effectiveness Ratios: A Comparison of Four Methods," Health Economics, John Wiley & Sons, Ltd., vol. 6(3), pages 243-252, May.
    3. Maiwenn J. Al & Ben A. Van Hout & Bowine C. Michel & Frans F.H. Rutten, 1998. "Sample size calculation in economic evaluations," Health Economics, John Wiley & Sons, Ltd., vol. 7(4), pages 327-335, June.
    4. Eugene M. Laska & Morris Meisner & Carole Siegel, 1999. "Power and Sample Size in Cost- Effectiveness Analysis," Medical Decision Making, , vol. 19(3), pages 339-343, August.
    5. Joseph Gardiner & Andrew Hogan & Margaret Holmes-Rovner & David Rovner & Lawrence Griffith & Joel Kupersmith, 1995. "Confidence Intervals for Cost - Effectiveness Ratios," Medical Decision Making, , vol. 15(3), pages 254-263, August.
    6. Andrew R. Willan & Bernie J. O'Brien, 1999. "Sample size and power issues in estimating incremental cost‐effectiveness ratios from clinical trials data," Health Economics, John Wiley & Sons, Ltd., vol. 8(3), pages 203-211, May.
    7. Andrew H. Briggs & David E. Wonderling & Christopher Z. Mooney, 1997. "Pulling cost‐effectiveness analysis up by its bootstraps: A non‐parametric approach to confidence interval estimation," Health Economics, John Wiley & Sons, Ltd., vol. 6(4), pages 327-340, July.
    8. Eugene M. Laska & Morris Meisner & Carole Siegel, 1997. "Statistical Inference for Cost–Effectiveness Ratios," Health Economics, John Wiley & Sons, Ltd., vol. 6(3), pages 229-242, May.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. William Hollingworth & Richard A. Deyo & Sean D. Sullivan & Scott S. Emerson & Darryl T. Gray & Jeffrey G. Jarvik, 2002. "The practicality and validity of directly elicited and SF‐36 derived health state preferences in patients with low back pain," Health Economics, John Wiley & Sons, Ltd., vol. 11(1), pages 71-85, January.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Martin W. McIntosh & Scott D. Ramsey & Kristin Berry & Nicole Urban, 2001. "Parameter solicitation for planning cost effectiveness studies with dichotomous outcomes," Health Economics, John Wiley & Sons, Ltd., vol. 10(1), pages 53-66, January.
    2. Daniel F. Heitjan & Alan J. Moskowitz & William Whang, 1999. "Bayesian estimation of cost‐effectiveness ratios from clinical trials," Health Economics, John Wiley & Sons, Ltd., vol. 8(3), pages 191-201, May.
    3. Andrew R. Willan & Andrew H. Briggs & Jeffrey S. Hoch, 2004. "Regression methods for covariate adjustment and subgroup analysis for non‐censored cost‐effectiveness data," Health Economics, John Wiley & Sons, Ltd., vol. 13(5), pages 461-475, May.
    4. Demissie Alemayehu, 2014. "Methodological Considerations in Cost-Effectiveness Analysis," Proceedings of Economics and Finance Conferences 0401651, International Institute of Social and Economic Sciences.
    5. Andrew Willan, 2011. "Sample Size Determination for Cost-Effectiveness Trials," PharmacoEconomics, Springer, vol. 29(11), pages 933-949, November.
    6. Ernst, Richard, 2017. "Theories of Health Care Cost-Effectiveness Analysis," SocArXiv gjbcp, Center for Open Science.
    7. Daniel F. Heitjan & Huiling Li, 2004. "Bayesian estimation of cost‐effectiveness: an importance‐sampling approach," Health Economics, John Wiley & Sons, Ltd., vol. 13(2), pages 191-198, February.
    8. Daniel F. Heitjan, 2000. "Fieller's method and net health benefits," Health Economics, John Wiley & Sons, Ltd., vol. 9(4), pages 327-335, June.
    9. Simon Eckermann & Andrew R. Willan, 2009. "Globally optimal trial design for local decision making," Health Economics, John Wiley & Sons, Ltd., vol. 18(2), pages 203-216, February.
    10. A. Gafni & S. D. Walter & S. Birch & P. Sendi, 2008. "An opportunity cost approach to sample size calculation in cost‐effectiveness analysis," Health Economics, John Wiley & Sons, Ltd., vol. 17(1), pages 99-107, January.
    11. Niklas Zethraeus & Magnus Johannesson & Bengt Jönsson & Mickael Löthgren & Magnus Tambour, 2003. "Advantages of Using the Net-Benefit Approach for Analysing Uncertainty in Economic Evaluation Studies," PharmacoEconomics, Springer, vol. 21(1), pages 39-48, January.
    12. Kobelt, G., 2013. "Health Economics: An Introduction to Economic Evaluation," Monographs, Office of Health Economics, number 000004.
    13. Henry Glick, 2011. "Sample Size and Power for Cost-Effectiveness Analysis (Part 1)," PharmacoEconomics, Springer, vol. 29(3), pages 189-198, March.
    14. Eugene M. Laska & Morris Meisner & Carole Siegel & Joseph Wanderling, 2002. "Statistical determination of cost‐effectiveness frontier based on net health benefits," Health Economics, John Wiley & Sons, Ltd., vol. 11(3), pages 249-264, April.
    15. Tommi Härkänen & Timo Maljanen & Olavi Lindfors & Esa Virtala & Paul Knekt, 2013. "Confounding and missing data in cost-effectiveness analysis: comparing different methods," Health Economics Review, Springer, vol. 3(1), pages 1-11, December.
    16. F. J. Vázquez‐Polo & M. A. Negrín Hernández & B. González López‐Valcárcel, 2005. "Using covariates to reduce uncertainty in the economic evaluation of clinical trial data," Health Economics, John Wiley & Sons, Ltd., vol. 14(6), pages 545-557, June.
    17. Jeffrey S. Hoch & Andrew H. Briggs & Andrew R. Willan, 2002. "Something old, something new, something borrowed, something blue: a framework for the marriage of health econometrics and cost‐effectiveness analysis," Health Economics, John Wiley & Sons, Ltd., vol. 11(5), pages 415-430, July.
    18. Andrew H. Briggs, 1999. "A Bayesian approach to stochastic cost‐effectiveness analysis," Health Economics, John Wiley & Sons, Ltd., vol. 8(3), pages 257-261, May.
    19. Manca, A & Austin, P. C, 2008. "Using propensity score methods to analyse individual patient-level cost-effectiveness data from observational studies," Health, Econometrics and Data Group (HEDG) Working Papers 08/20, HEDG, c/o Department of Economics, University of York.
    20. Joanne Lord & Maxwell A. Asante, 1999. "Estimating uncertainty ranges for costs by the bootstrap procedure combined with probabilistic sensitivity analysis," Health Economics, John Wiley & Sons, Ltd., vol. 8(4), pages 323-333, June.

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:wly:hlthec:v:9:y:2000:i:3:p:227-234. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Wiley Content Delivery (email available below). General contact details of provider: http://www3.interscience.wiley.com/cgi-bin/jhome/5749 .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.