Estimating Cost Functions for Resource Allocation Using Transmission Models: A Case Study of Tuberculosis Case Finding in South Africa

Dec 1, 2020, 00:00
10.1016/j.jval.2020.08.2096
https://www.valueinhealthjournal.com/article/S1098-3015(20)34363-1/fulltext
Title : Estimating Cost Functions for Resource Allocation Using Transmission Models: A Case Study of Tuberculosis Case Finding in South Africa
Citation : https://www.valueinhealthjournal.com/action/showCitFormats?pii=S1098-3015(20)34363-1&doi=10.1016/j.jval.2020.08.2096
First page : 1606
Section Title : METHODOLOGY
Open access? : No
Section Order : 1606

Objective

Cost functions linked to transmission dynamic models are commonly used to estimate the resources required for infectious disease policies. We present a conceptual and empirical approach for estimating these functions, allowing for nonconstant marginal costs. We aim to expand on the current approach which commonly assumes linearity of cost over scale.

Methods

We propose a theoretical framework adapted from the field of transport economics. We specify joint functions of production of services within a disease-specific program. We expand these functions to include qualitative insights of program expansion patterns. We present the difference in incremental total costs between an approach assuming constant unit costs and alternative approaches that assume economies of scale, scope and homogeneous or heterogeneous facility recruitment into the programme during scale-up. We illustrate the framework’s application in tuberculosis, using secondary data from the literature and routine reporting systems in South Africa.

Results

Economies of capacity and scope substantially change cost estimates over time. Cost data requirements for the proposed approach included standardized and disaggregated unit costs (for a limited number of outputs) and information on the facilities network available to the program.

Conclusions

The defined functional form will determine the magnitude and shape of costs when outputs and coverage are increasing. This in turn will impact resource allocation decisions. Infectious diseases modelers and economists should use transparent and empirically based cost models for analyses that inform resource allocation decisions. This framework describes a general approach for developing these models.

Categories :
  • Cost/Cost of Illness/Resource Use Studies
  • Decision & Deliberative Processes
  • Economic Evaluation
  • Health Technology Assessment
  • Methodological & Statistical Research
  • Modeling and simulation
  • Respiratory-Related Disorders
  • Specific Diseases & Conditions
Tags :
  • cost
  • cost functions
  • modeling
  • priority setting
Regions :
  • Africa
ViH Article Tags :