Potential effects of the choice of costing perspective on cost estimates: An example based on 6 early psychosis intervention programs

Carolyn S Dewa, Lucy Trojanowski, Chiachen Cheng, Jeffrey S Hoch

Research output: Contribution to journalArticle

2 Citations (Scopus)

Abstract

Objective: Because health care resources are constrained, decision-making processes often require clarifying the potential costs and savings associated with different options. This involves calculating a program's costs. The chosen costing perspective defines the costs to be considered and can ultimately influence decisions. Yet reviews of the literature suggest little attention has been paid to the perspective in economic evaluations. This article's purpose is to explore how the costing perspective can affect cost estimates. Method: As a vehicle for our discussion, we use service use data for clients enrolled in 6 Ontario early psychosis intervention programs. Governmental and nongovernmental payer costing perspectives are considered. We examine annual costs associated with early psychosis intervention clients enrolled for ≤12 months versus those enrolled for >12 months. This also allows for an assessment of the impact that choice of time horizon can make on the results. Results: The difference in total between group cost for hospital, emergency room, and physicians is $2499; the >12-month group has relatively higher mean costs. When all governmental and nongovernmental costs are considered, there is a mean between-group cost difference of $1272, with lower mean costs for the >12-month group. Conclusions: Although the Ministry of Health bears a large proportion of costs, other governmental agencies and the private sector can incur a sizeable share. This example demonstrates the potential importance of including other cost perspectives with the hospital sector in analyses as well as the impact of time horizon on cost estimates.

Original languageEnglish (US)
Pages (from-to)471-479
Number of pages9
JournalCanadian Journal of Psychiatry
Volume61
Issue number8
DOIs
StatePublished - 2016

Fingerprint

Psychotic Disorders
Costs and Cost Analysis
Private Sector
Cost Savings
Hospital Costs
Health Resources
Ontario
Cost-Benefit Analysis
Hospital Emergency Service
Decision Making
Delivery of Health Care
Physicians
Health

ASJC Scopus subject areas

  • Psychiatry and Mental health

Cite this

Potential effects of the choice of costing perspective on cost estimates : An example based on 6 early psychosis intervention programs. / Dewa, Carolyn S; Trojanowski, Lucy; Cheng, Chiachen; Hoch, Jeffrey S.

In: Canadian Journal of Psychiatry, Vol. 61, No. 8, 2016, p. 471-479.

Research output: Contribution to journalArticle

@article{6b03b69eb88646f58bac6e9b984452f1,
title = "Potential effects of the choice of costing perspective on cost estimates: An example based on 6 early psychosis intervention programs",
abstract = "Objective: Because health care resources are constrained, decision-making processes often require clarifying the potential costs and savings associated with different options. This involves calculating a program's costs. The chosen costing perspective defines the costs to be considered and can ultimately influence decisions. Yet reviews of the literature suggest little attention has been paid to the perspective in economic evaluations. This article's purpose is to explore how the costing perspective can affect cost estimates. Method: As a vehicle for our discussion, we use service use data for clients enrolled in 6 Ontario early psychosis intervention programs. Governmental and nongovernmental payer costing perspectives are considered. We examine annual costs associated with early psychosis intervention clients enrolled for ≤12 months versus those enrolled for >12 months. This also allows for an assessment of the impact that choice of time horizon can make on the results. Results: The difference in total between group cost for hospital, emergency room, and physicians is $2499; the >12-month group has relatively higher mean costs. When all governmental and nongovernmental costs are considered, there is a mean between-group cost difference of $1272, with lower mean costs for the >12-month group. Conclusions: Although the Ministry of Health bears a large proportion of costs, other governmental agencies and the private sector can incur a sizeable share. This example demonstrates the potential importance of including other cost perspectives with the hospital sector in analyses as well as the impact of time horizon on cost estimates.",
author = "Dewa, {Carolyn S} and Lucy Trojanowski and Chiachen Cheng and Hoch, {Jeffrey S}",
year = "2016",
doi = "10.1177/0706743716639917",
language = "English (US)",
volume = "61",
pages = "471--479",
journal = "Canadian Journal of Psychiatry",
issn = "0706-7437",
publisher = "Canadian Psychiatric Association",
number = "8",

}

TY - JOUR

T1 - Potential effects of the choice of costing perspective on cost estimates

T2 - An example based on 6 early psychosis intervention programs

AU - Dewa, Carolyn S

AU - Trojanowski, Lucy

AU - Cheng, Chiachen

AU - Hoch, Jeffrey S

PY - 2016

Y1 - 2016

N2 - Objective: Because health care resources are constrained, decision-making processes often require clarifying the potential costs and savings associated with different options. This involves calculating a program's costs. The chosen costing perspective defines the costs to be considered and can ultimately influence decisions. Yet reviews of the literature suggest little attention has been paid to the perspective in economic evaluations. This article's purpose is to explore how the costing perspective can affect cost estimates. Method: As a vehicle for our discussion, we use service use data for clients enrolled in 6 Ontario early psychosis intervention programs. Governmental and nongovernmental payer costing perspectives are considered. We examine annual costs associated with early psychosis intervention clients enrolled for ≤12 months versus those enrolled for >12 months. This also allows for an assessment of the impact that choice of time horizon can make on the results. Results: The difference in total between group cost for hospital, emergency room, and physicians is $2499; the >12-month group has relatively higher mean costs. When all governmental and nongovernmental costs are considered, there is a mean between-group cost difference of $1272, with lower mean costs for the >12-month group. Conclusions: Although the Ministry of Health bears a large proportion of costs, other governmental agencies and the private sector can incur a sizeable share. This example demonstrates the potential importance of including other cost perspectives with the hospital sector in analyses as well as the impact of time horizon on cost estimates.

AB - Objective: Because health care resources are constrained, decision-making processes often require clarifying the potential costs and savings associated with different options. This involves calculating a program's costs. The chosen costing perspective defines the costs to be considered and can ultimately influence decisions. Yet reviews of the literature suggest little attention has been paid to the perspective in economic evaluations. This article's purpose is to explore how the costing perspective can affect cost estimates. Method: As a vehicle for our discussion, we use service use data for clients enrolled in 6 Ontario early psychosis intervention programs. Governmental and nongovernmental payer costing perspectives are considered. We examine annual costs associated with early psychosis intervention clients enrolled for ≤12 months versus those enrolled for >12 months. This also allows for an assessment of the impact that choice of time horizon can make on the results. Results: The difference in total between group cost for hospital, emergency room, and physicians is $2499; the >12-month group has relatively higher mean costs. When all governmental and nongovernmental costs are considered, there is a mean between-group cost difference of $1272, with lower mean costs for the >12-month group. Conclusions: Although the Ministry of Health bears a large proportion of costs, other governmental agencies and the private sector can incur a sizeable share. This example demonstrates the potential importance of including other cost perspectives with the hospital sector in analyses as well as the impact of time horizon on cost estimates.

UR - http://www.scopus.com/inward/record.url?scp=84983429041&partnerID=8YFLogxK

UR - http://www.scopus.com/inward/citedby.url?scp=84983429041&partnerID=8YFLogxK

U2 - 10.1177/0706743716639917

DO - 10.1177/0706743716639917

M3 - Article

C2 - 27310225

AN - SCOPUS:84983429041

VL - 61

SP - 471

EP - 479

JO - Canadian Journal of Psychiatry

JF - Canadian Journal of Psychiatry

SN - 0706-7437

IS - 8

ER -