Analysis of costs for costeffectiveness from the perspective of a health economist
*Henry A Glick, University of Pennsylvania
Keywords: costeffectiveness analysis, cost analysis, generalized linear models
The difference in arithmetic mean cost is the primary cost outcome of interest in costeffectiveness analysis. Its analysis is complicated by the routine nonnormality of cost data which violates assumptions of most parametric techniques used to analyze raw cost data. Commonly proposed methods to address this issuenonparametric tests like the Wilcoxon rank sum test or transformations of the dataare inappropriate because they test something other than the arithmetic mean or pose difficulties for estimation of the predicted difference in arithmetic mean cost. Use of a nonparametric bootstrap (univariate) or estimation techniques such as generalized linear models (multivariable) allows estimation of and the drawing of inferences for the difference in arithmetic mean. Problems with the more commonly proposed solutions and the alternative methods that avoid these problems are described.
