ABSTRACT
Economic evaluations of new and existing healthcare interventions are an essential input into decision-making. Healthcare systems around the world face steady increases in expenditure as a result of demographic change and improvements in medical technology. Increasingly, payers must choose which interventions will be provided and which will not be reimbursed from limited public or private funds. This creates difficult choices, as systems are no longer limited by what is technically possible to improve the health of patients but by what is practically possible given resource constraints. In a situation where resources are scarce, all choices about who will be treated have an opportunity cost – the value of the benefit foregone. Health economics and the techniques of economic evaluation aim to maximize the amount of health that is produced within the scarce resources available. In the UK, the National Institute for Clinical Excellence (NICE) synthesizes evidence and reaches a judgment as to whether on balance the intervention can be recommended as a cost-effective use of National Health Service (NHS) resources.1 In 2000, NICE published recommendations for the use of laparoscopic hernia surgery. It recommended its use outside centers of expertise only in cases of bilateral inguinal hernia or recurrent inguinal hernia. In the UK in 1996, approximately ten per cent of hernia repairs were carried out laparoscopically.2 Since the publication of the NICE guidelines, this figure has decreased dramatically and supports the concept that the application of clinical pathways can reduce costs. Such measures are important in the UK, where the numbers of medical staff and the annual NHS budget are well below those in other European countries, Organization for
Economic Cooperation and Development (OECD) countries, and the USA.3
