Cost-Utility Analysis Has Potential to Measure the Value of Public Health Systems

    • August 28, 2008

Determining the value of governmental public health systems—the state and local public health agencies designed to assess and respond to public health threats—remains a challenge. In this 2006–2007 project, Peter Jacobson, JD, MPH, and Peter Neumann, ScD, from the University of Michigan School of Public Health and Tufts Medical Center, respectively, explored ways to define and measure the value of governmental public health systems through a literature review and interviews with 46 public health practitioners, policy-makers and academics.

The project was part of the Robert Wood Johnson Foundation (RWJF) Changes in Health Care Financing and Organization (HCFO) national program. HCFO supports policy analysis, research, evaluation and demonstration projects that provide public and private decision leaders with usable and timely information on health care policy and financing issues.

Key Findings

  • The researchers reported the following findings:

    • Defining and measuring the value of public health services is challenging but essential.
    • Governmental public health systems must use appropriate techniques to demonstrate a measurable contribution to society.
    • Cost-utility analysis, which presents the impact of services or programs in terms of incremental costs per incremental quality-adjusted life year, has considerable potential for measuring the value of public health services, but also carries challenges. (A quality-adjusted life year [QALY] is a year of life adjusted for its quality or its value. A year in perfect health equals 1.0 QALY. The value of a year in ill health is discounted. For example, a year bedridden might have a value equal to 0.5 QALY).