Economic evaluation of public health: Setting standards, criteria, indicators

Economic Evaluation of public health: Setting standards, criteria, indicators

The economic evaluation of public health services involves a systematic process to assess the efficiency, effectiveness, and economic impact of these services. It encompasses various types of analysis, including standard setting, criteria setting, establishing indicators, and selecting methods and tools. Here’s a detailed explanation of these processes:

⇒ Health Economics Notes for BPH Students

1. Standard Setting:

Standard setting in economic evaluation of public health services involves defining the benchmarks or standards against which the performance and outcomes of these services will be measured. It establishes the criteria for assessing whether a public health intervention or program is considered successful or effective.


  • Identify Objectives: Clearly define the objectives and goals of the public health service or intervention. What is it intended to achieve? For example, reducing the incidence of a specific disease or improving the overall health of a population.
  • Review Existing Standards: Examine existing guidelines, regulations, and best practices in the field of public health. These can serve as a starting point for setting standards.
  • Consult Experts: Seek input from experts in the field of public health to determine realistic and evidence-based standards.
  • Consider Context: Take into account the specific context, population, and resources available for the public health service. Standards should be attainable within the given context.
  • Establish Quantifiable Measures: Define measurable and quantifiable indicators that can be used to assess whether the standards are met.

2. Criteria Setting:

Criteria setting involves specifying the criteria that will be used to evaluate the performance, cost-effectiveness, and impact of public health services. These criteria guide the decision-making process and help determine whether an intervention is worthwhile.


  • Select Relevant Criteria: Choose criteria that are relevant to the objectives of the public health service. Common criteria include health outcomes, cost-effectiveness, equity, feasibility, and acceptability.
  • Weight Criteria: Assign weights to each criterion to reflect their relative importance. Some criteria may carry more weight than others, depending on the context and priorities.
  • Consider Stakeholder Input: Gather input from various stakeholders, including healthcare professionals, policymakers, and the community, to ensure that the selected criteria align with their interests and values.
  • Define Thresholds: Specify the thresholds or benchmarks that must be met for each criterion. These thresholds indicate when a public health service is deemed successful or cost-effective.

3. Establishing Indicators:

Indicators are specific, measurable variables that provide evidence of the performance and outcomes of public health services. They serve as quantitative measures of progress toward achieving the defined standards and criteria.


  • Identify Relevant Indicators: Determine which indicators are most relevant to the objectives and criteria set for the evaluation. These may include health outcomes (e.g., reduced mortality rates), economic measures (e.g., cost per quality-adjusted life year), and process indicators (e.g., vaccination coverage rates).
  • Define Measurement Methods: Specify how each indicator will be measured and collected. This includes the data sources, measurement tools, and frequency of data collection.
  • Establish Baselines: Gather baseline data to establish a starting point for measurement. Baseline data are essential for comparing the impact of the public health service over time.
  • Monitor and Evaluate: Continuously monitor and evaluate the selected indicators to track progress and make adjustments as needed. Regular data collection and analysis are key components of this process.

4. Deciding Methods and Tools:

The selection of appropriate methods and tools is crucial for conducting economic evaluations of public health services effectively. These methods and tools are used to gather, analyze, and interpret data to assess the economic efficiency and effectiveness of interventions.


  • Choose Economic Evaluation Method: Select the most suitable economic evaluation method based on the objectives, available data, and resources. Common methods include cost-effectiveness analysis (CEA), cost-utility analysis (CUA), cost-benefit analysis (CBA), and cost-minimization analysis (CMA).
  • Select Data Collection Tools: Determine the data collection tools and instruments needed to gather relevant information, such as surveys, questionnaires, medical records, or administrative databases.
  • Utilize Economic Models: Economic models, such as decision trees, Markov models, or simulation models, may be employed to project long-term outcomes and assess the economic impact of public health services.
  • Analyze Data: Use statistical and economic analysis techniques to process and analyze collected data. Statistical software and economic modeling software can be valuable tools in this phase.
  • Interpret Results: Interpret the results of economic evaluations in the context of the defined standards and criteria. Assess whether the public health service meets the established benchmarks.

Utilization of economic evaluation results in planning and financing public health services

The utilization of economic evaluation results in planning and financing public health services is a critical step in ensuring that limited resources are allocated efficiently and effectively to improve the health of a population. This process involves using the findings and insights from economic evaluations to inform decision-making, prioritize interventions, and allocate financial resources strategically within the public health sector. Here’s a detailed explanation of how economic evaluation results are utilized in planning and financing public health services:

1. Informed Decision-Making:

  • Evaluating Intervention Effectiveness: Economic evaluations provide evidence on the cost-effectiveness and cost-benefit of different public health interventions. Decision-makers can use this information to identify interventions that offer the best value for money in achieving specific health outcomes.
  • Selecting Priority Interventions: By comparing the cost-effectiveness of various interventions, public health planners can prioritize those that provide the greatest health benefits relative to their costs. This helps in focusing resources on high-impact interventions.

2. Resource Allocation:

  • Budget Allocation: Economic evaluation results guide the allocation of budgets within the public health sector. Decision-makers can allocate resources to interventions that are not only effective but also cost-efficient, maximizing the health gains within the available budget.
  • Optimizing Resource Use: Economic evaluations help identify opportunities to reallocate resources from less cost-effective interventions to those with better outcomes. This ensures that resources are used efficiently and have the greatest impact on population health.

3. Funding Decisions:

  • Attracting Funding: Economic evaluation results can be used to attract external funding, including grants from governmental and non-governmental organizations, by demonstrating the economic feasibility and benefits of specific public health initiatives.
  • Advocating for Investment: Decision-makers can use economic evaluation findings to advocate for increased public and private sector investment in public health services. The evidence of cost-effectiveness can justify greater financial support.

4. Policy Development:

  • Policy Formulation: Economic evaluations provide data-driven insights into the potential impact of policy changes or new regulations on public health outcomes and costs. This informs the development of evidence-based policies.
  • Alignment with Health Objectives: Economic evaluation results help align public health policies with broader health objectives and societal goals, ensuring that resources are directed toward achieving desired health outcomes.

5. Monitoring and Evaluation:

  • Performance Monitoring: Public health planners can use economic evaluation results as benchmarks to monitor the performance of interventions over time. If an intervention’s cost-effectiveness deteriorates, adjustments can be made.
  • Feedback Loop: Regular economic evaluations create a feedback loop, allowing decision-makers to refine strategies, update resource allocations, and adapt interventions based on evolving evidence.

6. Stakeholder Engagement:

  • Engaging Stakeholders: Involving stakeholders, including healthcare professionals, community members, and policymakers, in the economic evaluation process ensures that their perspectives and priorities are considered in planning and financing decisions.
  • Transparency and Accountability: The transparent use of economic evaluation results enhances accountability in resource allocation and decision-making processes, fostering trust among stakeholders.

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