Which analysis converts outcomes into monetary units to assess net benefits?

Which analysis converts outcomes into monetary units to assess net benefits?

• A. Cost-benefit analysis
• B. Cost-effectiveness analysis
• C. Budget impact analysis
• D. Cost-minimization analysis

Answer: (A)

Monetizing outcomes to compare benefits and costs is what cost-benefit analysis does. In this approach, both the costs of an intervention and the benefits it produces—such as reduced hospitalizations, improved quality of life, or increased productivity—are assigned monetary values. This lets you calculate the net benefit (benefits minus costs) or a benefit-cost ratio, providing a single metric to judge whether the intervention offers a positive return from a societal or payer perspective. This contrasts with cost-effectiveness analysis, which keeps outcomes in natural units (like life-years gained or cases prevented) and compares efficiency without monetizing effects. Budget impact analysis focuses on the short-term financial effect on a specific budget, typically without converting health outcomes into dollars. Cost-minimization analysis assumes outcomes are the same and compares costs alone.

Monetizing outcomes to compare benefits and costs is what cost-benefit analysis does. In this approach, both the costs of an intervention and the benefits it produces—such as reduced hospitalizations, improved quality of life, or increased productivity—are assigned monetary values. This lets you calculate the net benefit (benefits minus costs) or a benefit-cost ratio, providing a single metric to judge whether the intervention offers a positive return from a societal or payer perspective.

This contrasts with cost-effectiveness analysis, which keeps outcomes in natural units (like life-years gained or cases prevented) and compares efficiency without monetizing effects. Budget impact analysis focuses on the short-term financial effect on a specific budget, typically without converting health outcomes into dollars. Cost-minimization analysis assumes outcomes are the same and compares costs alone.