Recently, I had a question about cost effectiveness analysis. Basically this is a branch of Economics which looks at which health treatments offer the best return for the cost involved.
The problem is that health care is an emotive issue and the idea of economists saying which treatments should be used and which should not be allowed is liable to create much criticism.
This short essay is a look at some of the issues involved – Deciding Who Gets Treatment
The fundamental problem of economics is scarcity and therefore each decision involves an opportunity cost. If we spend £1million pounds on one drug then we cannot spend it on other things. Economists can help decide who gets the treatment, but, it is society which needs to decide how much resources are given to health care.
If we want to give everyone access to the latest drugs, no matter what the cost – are we willing to pay the opportunity cost of higher taxes?