nep-hea New Economics Papers
on Health Economics
Issue of 2018‒07‒09
twenty-two papers chosen by
Nicolas R. Ziebarth
Cornell University

  1. Financial Incentives and Earnings of Disability Insurance Recipients: Evidence from a Notch Design By Ruh, Philippe; Staubli, Stefan
  2. Pension reform: Disentangling retirement and savings responses By Lindeboom, M.; Montizaan, Raymond
  3. Your Retirement and My Health Behavior: Evidence on Retirement Externalities from a fuzzy regression discontinuity design By Tobias Mueller, Mujaheed Shaikh
  4. Labor Market and Distributional Effects of an Increase in the Retirement Age By Johannes Geyer; Peter Haan; Anna Hammerschmid; Michael Peters
  5. Long-run Effects of Lottery Wealth on Psychological Well-being By Erik Lindqvist; Robert Östling; David Cesarini
  6. The Effects of Means-tested, Noncontributory Pensions on Poverty and Well-being: Evidence from the Chilean Pension Reforms By Italo López García; Andrés Otero
  7. Long Term Care Risk Misperceptions By Martin Boyer; Philippe De Donder; Claude Fluet; Marie-Louise Leroux; Pierre-Carl Michaud
  8. Uncertain altruism and non-linear long-term care policies By Canta, Chiara; Cremer, Helmuth
  9. Do Working Hours Affect Health? Evidence from Statutory Workweek Regulations in Germany By Kamila Cygan-Rehm; Christoph Wunder
  10. Well-being Inequality in the Long Run By Leandro Prados de la Escosura
  11. Long-term Consequences of the Atomic Bombing in Hiroshima By Satoshi Shimizutani; Hiroyuki Yamada
  12. The Intergenerational Transmission of Welfare Dependency By Monique De Haan; Ragnhild C. Schreiner
  13. Reclassification Risk in the Small Group Health Insurance Market By Sebastián Fleitas; Gautam Gowrisankaran; Anthony Lo Sasso
  14. Guaranteed Renewable Life Insurance Under Demand Uncertainty By Michael Hoy; Afrasiab Mirza; Asha Sadanand
  15. Does personalized information improve health plan choices when individuals are distracted? By Cornel Kaufmann, Tobias Mueller, Andreas Hefti, Stefan Boes
  16. An Assessment of the Forward-Looking Hypothesis of the Demand for Cigarettes By Robert Kaestner; Kevin Callison
  17. Immigration and the Reallocation of Work Health Risks By Giuntella, Osea; Mazzonna, Fabrizio; Nicodemo, Catia; Vargas-Silva, Carlos
  18. Comparing the Productive Effects of Cash and Food Transfers in a Crisis Setting: Evidence from a randomized experiment in Yemen By Benjamin Schwab; UNICEF Office of Research - Innocenti
  19. In-Kind Transfer and Child Development: Evidence from Subsidized Rice Program in Indonesia By Gupta, Prachi; Huang, Bihong
  20. Bayesian epidemic models for spatially aggregated count data By Malesios, C; Demiris, N; Kalogeropoulos, K; Ntzoufras, I
  21. Nutritional and economic impact of 5 alternative front-of-pack nutritional labels: experimental evidence By Paolo Crosetto; Anne Lacroix; Laurent Muller; Bernard Ruffieux
  22. A systematic review of the cost-effectiveness of liver transplantation By Roberta Longo; Alastair Young; Ian A. Rowe; Rebecca L. Jones; Amy Downing; Adam Glaser; Giles J. Toogood

  1. By: Ruh, Philippe; Staubli, Stefan
    Abstract: Most countries reduce Disability Insurance (DI) benefits for beneficiaries earning above a specified threshold. Such an earnings threshold generates a discontinuous increase in tax liability-a notch- and creates an incentive to keep earnings below the threshold. Exploiting such a notch in Austria, we provide transparent and credible identification of the effect of financial incentives on DI beneficiaries' earnings. Using rich administrative data, we document large and sharp bunching at the earnings threshold. However, the elasticity driving these responses is small. Our estimate suggests that relaxing the earnings threshold reduces fiscal cost only if program entry is very inelastic.
    Keywords: benefit notch; bunching; Disability insurance; Labor Supply
    JEL: H53 H55 J14 J21
    Date: 2018–06
  2. By: Lindeboom, M.; Montizaan, Raymond (ROA / Dynamics of the labour market)
    Abstract: In January 2006, the Dutch government implemented a pension reform that substantially reduced the public pension wealth of workers born in 1950 or later. At the same time, a tax-facilitated savings plan was introduced that substantially reduced the saving costs of all workers, irrespective of birth year. This paper uses linked administrative and survey data to assess the effect of the reform on the savings and retirement expectations and realizations of two virtually identical male cohorts that differ only in treatment status, the treated having been born in 1950 and the controls having been born in 1949. We show that retirement expectations are in line with realizations and that the reform had the intended effect on the labor supply for the larger part of the workers, namely, those without sufficient means to substantially increase private savings to counter the effect of the reform. These workers, who are generally in worse health, have zero substitution rates between private and public wealth. On the other hand, there is a group of mostly high-wage workers who participate in the tax-facilitated Life Course Savings Scheme and who increase private savings to fully counter the impact of the drop in public wealth. A further, unintended side effect of the introduction of the tax-facilitated savings plan is that high wage earners who are not affected by the drop in pension wealth retire even sooner than initially planned.
    Keywords: natural experiment, regression discontinuity, retirement, private wealth, public wealth, crowding out, substitution rate
    JEL: J26 H55 J14
    Date: 2018
  3. By: Tobias Mueller, Mujaheed Shaikh
    Abstract: This paper presents evidence on intra-household retirement externalities by assessing the causal e ect of spousal retirement on various health behaviors and health status across 19 European countries. We identify partner's and own retirement e ects by applying a fuzzy regression discontinuity design using retirement eligibility as exogenous instruments for spousal and own retirement status. We nd signi cant increases in the frequency and intensity of alcohol consumption combined with a signi cant decrease in moderate physical activities as a response to partner's retirement. In line with the existing literature, we nd that own retirement has signi cant positive e ects on engaging in moderate and vigorous physical activities but also leads to a signi cant increase in the frequency of alcohol intake. Overall, subjective health is negatively a ected by spousal retirement and positively by own retirement.
    Keywords: Retirement Externalities, Health behavior, Fuzzy Regression Discontinuity Design
    JEL: J26 I12 C26
    Date: 2017–08
  4. By: Johannes Geyer; Peter Haan; Anna Hammerschmid; Michael Peters
    Abstract: We evaluate the labor market and distributional effects of an increase in the early retirement age (ERA) from 60 to 63 for women. We use a regression discontinuity design which exploits the immediate increase in the ERA between women born in 1951 and 1952. The analysis is based on the German micro census which includes about 370,000 households per year. We focus on heterogeneous labor market effects on the individual and on the household level and we study the distributional implications using net household income. In this respect we extend the previous literature which mainly studied employment effects on the individual level. Our results show sizable labor market effects which strongly differ by subgroups. We document larger employment effects for women who cannot rely on other income on the household level, e.g. women with a low income partner. The distributional analysis shows on average no significant effects on female or household income. This result holds as well for heterogeneous groups: Even for the most vulnerable groups, such as single women, women without higher education, or low partner income, we do not find significant reductions in income. One reason for this result is program substitution.
    Keywords: retirement age, pension reform, labor supply, early retirement, distributional effects, spillover effects, household
    JEL: J14 J18 J22 J26 H31
    Date: 2018
  5. By: Erik Lindqvist; Robert Östling; David Cesarini
    Abstract: We surveyed a large sample of Swedish lottery players about their psychological well-being and analyzed the data following pre-registered procedures. Relative to matched controls, large-prize winners experience sustained increases in overall life satisfaction that persist for over a decade and show no evidence of dissipating with time. The estimated treatment effects on happiness and mental health are significantly smaller, suggesting that wealth has greater long-run effects on evaluative measures of well-being than on affective ones. Follow-up analyses of domain-specific aspects of life satisfaction clearly implicate financial life satisfaction as an important mediator for the long-run increase in overall life satisfaction.
    JEL: D69 I31
    Date: 2018–05
  6. By: Italo López García (RAND Corporation); Andrés Otero (Chilean Pension Regulator)
    Abstract: Chile initiated in 1981 a privately managed, individual-account pension system that inspired similar reforms in many Latin American countries, and that has been considered as a possible model for Social Security in the United States. After 30 years in place, the Chilean pension system has been criticized for replicating existing inequalities in labor markets and increasing the risk of old-age poverty; for achieving lower levels of coverage; and for providing low pension benefits. Aiming at guaranteeing a minimum level of consumption upon retirement and increasing the incentives to contribute, in 2008 Chile reformed the Pension System, widening the welfare tier and improving the contributory tier through a means-testing scheme. This paper examines the impact of the 2008 Chilean pension on labor supply and well-being, using a version of the difference-in-difference estimator that assesses the effects of the reform through exogenous changes in pension wealth. Using longitudinal data from 2006 through 2012, and a sample of individuals that were not retired by the time of the implementation of the reforms, our preliminary estimates suggest that the pension reforms induced an increase in the probability of working formally, but at least among females, they reduced labor market participation. However, we find limited impacts of the reform on nonlabor outcomes. Besides some improvements in aggregate household expenditures and in measures of subjective well-being measures among males, we do not detect robust changes in health and well-being among individuals near retirement.
    Date: 2017–02
  7. By: Martin Boyer; Philippe De Donder; Claude Fluet; Marie-Louise Leroux; Pierre-Carl Michaud
    Abstract: This paper reports survey evidence on long-term care (LTC) risk misperceptions and demand for long-term care insurance (LTCI) in Canada. LTC risk misperceptions is divided into three different risks: needing help for at least one activity of daily life, needing access to a nursing home, and living to be 85 years old. We contrast subjective (i.e. stated) probabilities with actual probabilities for these three dimensions. We first provide descriptive statistics of how objective and subjective probabilities differ and correlate to each other. Second, we study cross-correlations between different types of risks. We then study how risk misperceptions correlate with individual characteristics, and evaluate how misperceptions affect intentions and actual purchase of LTCI. Our conclusions are two-fold. First, we find that most subjects are not well informed about their individual LTC risks, making it difficult for them to take the correct LTCI decisions. Second, and even though misperceptions explain an individuals actual or his intentions to take-up LTCI, misperceptions are unlikely to explain the poor take-up rate of LTCI in our sample.
    Keywords: long-term care insurance puzzle, disability, misperceptions, subjective probability
    JEL: D91 I13
    Date: 2018
  8. By: Canta, Chiara; Cremer, Helmuth
    Abstract: We study the design of public long-term care (LTC) insurance when the altruism of informal caregivers is uncertain. We consider non-linear policies where the LTC benefit depends on the level of informal care, which is assumed to be observable while children's altruism is not. The traditional topping up and opting out policies are special cases of ours. Both total and informal care should increase with the children's level of altruism. This obtains under full and asymmetric information. Social LTC, on the other hand, may be non-monotonic. Under asymmetric information, social LTC is lower than its full information level for the lowest level of altruism, while it is distorted upward for the higher level of altruism. This is explained by the need to provide incentives to highaltruism children. The implementing contract is always such that social care increases with formal care.
    Keywords: Long term care; uncertain altruism; private insurance; public insurance; topping up; opting out
    JEL: H2 H5
    Date: 2018–05
  9. By: Kamila Cygan-Rehm; Christoph Wunder
    Abstract: This study estimates the causal effect of working hours on health. We deal with the endogeneity of working hours through instrumental variables techniques. In particular, we exploit exogenous variation in working hours from statutory workweek regulations in the German public sector as an instrumental variable. Using panel data, we run two-stage least squares regressions controlling for individual-specific unobserved heterogeneity. We find adverse consequences of increasing working hours on subjective and several objective health measures. The effects are mainly driven by women and parents of minor children who generally face heavier constraints in organizing their workweek.
    Keywords: working time, health, standard workweek, Germany
    JEL: I10 J22 J81
    Date: 2018
  10. By: Leandro Prados de la Escosura (Universidad Carlos III, Groningen, and CEPR)
    Abstract: This paper provides a long-run view of well-being inequality at world scale based on a new historical dataset. Trends in social dimensions alter the view on inequality derived from per capita GDP. While in terms of income, inequality increased until the third quarter of the twentieth century; in terms of well-being, inequality fell steadily since World War I. The spread of mass primary education and the health transitions were its main drivers. The gap between the West and the Rest explains only partially the evolution of well-being inequality, as the dispersion within the developing regions has increasingly determined its evolution.
    Keywords: Well-being, Inequality, Life Expectancy, Health Transition, Education, per capita GDP
    JEL: I00 N30 O15 O50
    Date: 2018–05
  11. By: Satoshi Shimizutani (Nakasone Yasuhiro Peace Institute); Hiroyuki Yamada (Faculty of Economics, Keio University)
    Abstract: This paper examines long-term consequences of one of the most serious catastrophes ever inflicted on humankind: the atomic bombing that occurred in Hiroshima in 1945. While many victims died immediately or within a few years of the bombing, there were many negative effects on survivors in terms of both health and social/economic aspects that could last many years. Of these two life factors, health and social/economic aspects, the latter has largely been ignored by researchers. We investigate possible long-lasting effects using a new dataset covering the middle and older generations in Hiroshima some 60 years after the tragedy. Our empirical results show that Atomic Bomb Survivors did not necessarily suffer unfavorable life experiences in terms of the average marriage status or educational attainment but did experience significant disadvantages some aspects including the husband/wife combination of married couples, work status, mental health, and expectations for the future. Thus, survivors have suffered for many years after the catastrophe itself.
    Keywords: social discrimination,atomic bomb, radiation exposure, Hiroshima
    JEL: I18 I31 H12
  12. By: Monique De Haan (University of Oslo); Ragnhild C. Schreiner (Department of Economics, University College London, CReAM and the Ragnar Frisch Centre for Economic Research)
    Abstract: There is a strong intergenerational correlation in welfare participation, but this does not imply that parental welfare receipt induces child receipt. While there are a few quasi-experimental studies that provide estimates of the causal effect of parental welfare participation for children from marginal welfare participants, we know very little about intergenerational spillovers of welfare participation onto the children of average welfare participants. By combining rich administrative data from Norway with weak mean-monotonicity assumptions, we estimate nonparametric bounds around the average causal effect of parental welfare participation on children’s welfare participation in the general population, as well as the average causal effect for children growing up in welfare-dependent families. We find that these average causal effects are considerably lower than the intergenerational correlation in welfare participation, and substantially below available local average treatment effect estimates in the literatu . We further find important differences between intergenerational spillovers of disability insurance and intergenerational spillovers of financial assistance, a traditional means-tested welfare program.
    Keywords: Welfare dependency, intergenerational spillovers, disability insurance, financial assistance,partial identification
    JEL: H55 I38 J62
    Date: 2018–06
  13. By: Sebastián Fleitas; Gautam Gowrisankaran; Anthony Lo Sasso
    Abstract: We evaluate reclassification risk and adverse selection in the small group insurance market from a period before ACA community rating regulations. Using detailed individual-level data from a large insurer, we find a pass through of 5-43% from expected health risk to premiums. This limited reclassification risk cannot be explained by market power or search frictions but may be due to implicit long-term contracts. We find no evidence of adverse selection generated by reclassification risk. The observed pricing policy adds $2,346 annually in consumer welfare over 10 years relative to experience rating. Community rating would not increase consumer welfare substantially.
    JEL: I13 L13
    Date: 2018–05
  14. By: Michael Hoy; Afrasiab Mirza; Asha Sadanand
    Abstract: Guaranteed renewability is a prominent feature in many health and life insurance markets. It is well established in the literature that, when there is (only) risk type uncertainty, the optimal GR contract with renewal price set at the actuarially fair price for low risk types provides full insurance against reclassification risk. We develop a model that includes unpredictable (and unobservable) fluctuations in demand for life insurance as well as changes in risk type (observable) over individuals' lifetimes. The presence of demand type heterogeneity leads to the possibility that optimal GR contracts may have a renewal price that is either above or below the actuarially fair price of the lowest risk type in the population. Individuals whose type turns out to be high risk but low demand renew more of their GR insurance than is efficient due to the attractive renewal price. This results in incomplete insurance against re-classification risk. Although a first best efficient contract is not possible in the presence of demand type heterogeneity, the presence of GR contracts nonetheless improves welfare relative to an environment with only spot markets. Our results also apply to a comparison of environments with short versus long term (front loaded) insurance contracts.
    Keywords: insurance, guaranteed renewability, re-classification risk, demand uncertainty
    JEL: D80 D86 G22
    Date: 2018
  15. By: Cornel Kaufmann, Tobias Mueller, Andreas Hefti, Stefan Boes
    Abstract: Choice-based health insurance systems allow individuals to select a health plan that ts their needs. However, bounded rationality and limited attention may lead to sub-optimal insurance coverage and higher-than-expected out-of-pocket payments. In this paper, we study the impact of providing personalized information on health plan choices in a laboratory experiment. We seek to more closely mimic real-life choices by randomly providing an incentivized distraction to some individuals. We nd that providing personalized information signi cantly improves health plan choices. The positive e ect is even larger and longer-lasting if individuals are distracted from their original task. In addition to providing decision support, receiving personalized information restores the awareness of the choice setting to a level comparable to the case without distraction thus reducing inertia. Our results indicate that increasing transparency of the health insurance system and providing tailored information can help individuals to make better choices and reduce their out-of-pocket expenditures.
    Keywords: health insurance choice; decision under uncertainty; limited attention; information; laboratory experiment
    JEL: I13 D83 C91
    Date: 2018–03
  16. By: Robert Kaestner; Kevin Callison
    Abstract: In this article we develop a model of the demand for cigarettes that incorporates forward-looking behavior related to the adverse health consequences of smoking and the addictive nature of cigarettes. The model results in several testable hypotheses that we use to examine the extent to which smokers exhibit forward-looking behavior. Results of our study are generally supportive of the notion that smokers behave in a forward-looking manner.
    JEL: D12 I12 I18
    Date: 2018–05
  17. By: Giuntella, Osea; Mazzonna, Fabrizio; Nicodemo, Catia; Vargas-Silva, Carlos
    Abstract: This paper studies the effects of immigration on the allocation of occupational physical burden and work injury risks. Using data for England and Wales from the Labour Force Survey (2003-2013), we find that, on average, immigration leads to a reallocation of UK-born workers towards jobs characterized by lower physical burden and injury risk. The results also show important differences across skill groups. Immigration reduces the average physical burden of UK-born workers with medium levels of education, but has no significant effect on those with low levels. We also find that that immigration led to an improvement selfreported measures of native workers’ health. These findings, together with the evidence that immigrants report lower injury rates than natives, suggest that the reallocation of tasks could reduce overall health care costs and the human and financial costs typically associated with workplace injuries.
    Keywords: Immigration,labor-market,physical burden,work-related injuries,health
    JEL: J61 I10
    Date: 2018
  18. By: Benjamin Schwab; UNICEF Office of Research - Innocenti
    Abstract: The productive impacts of transfer programmes have received increased attention. However, little is known about such effects in emergency and crisis settings. Even less is known about whether transfer type – a food basket or a cash grant – influences the productive potential of such transfers. Theory suggests that, while cash transfers can relieve liquidity constraints associated with investments, subsidized food provision, by acting as a form of insurance, may prevent households from retreating to conservative income-generating strategies during volatile periods. Using a randomized field experiment in Yemen, we contrast the effects of transfer modality. The results demonstrate a modest productive impact of both modalities and suggest a role for both liquidity and price risk channels. Cash transfer recipients invested relatively more in activities with higher liquidity requirements (livestock), while food recipients incorporated higher-return crops into their agricultural portfolios.
    Date: 2018
  19. By: Gupta, Prachi (Asian Development Bank Institute); Huang, Bihong (Asian Development Bank Institute)
    Abstract: In the aftermath of the Asian financial crises, the Indonesian government launched a subsidized rice program called RASKIN in 1998 to moderate the shocks of food price inflation and reduced employment to poor households. The program has been continued since then with an objective to provide food security to poor families and is currently the largest in-kind transfer in Indonesia. Using data from five rounds of the Indonesian Family Life Survey covering the period of 1993–2014, we examine the impact of RASKIN on children’s health status. Using the difference-in-difference estimator, we find that children from the households that are beneficiaries of the RASKIN program show improved health status as measured by various anthropometric measures. We further investigate the long-run gains from RASKIN by tracing the health status of children aged between 0 and 5 years old in 1993 and 1997, respectively, until their adolescence/adulthood. We find evidence of improved anthropometric health outcomes for these children in later years. The gains are found to be higher for children who started receiving the subsidized rice in the early years of childhood.
    Keywords: in-kind transfers; food consumption; child development; health; long-run impact
    JEL: H50 I12 I38 O15 Q18
    Date: 2018–03–21
  20. By: Malesios, C; Demiris, N; Kalogeropoulos, K; Ntzoufras, I
    Abstract: Epidemic data often possess certain characteristics, such as the presence of many zeros, the spatial nature of the disease spread mechanism, environmental noise, serial correlation and dependence on time varying factors. This paper addresses these issues via suitable Bayesian modelling. In doing so we utilise a general class of stochastic regression models appropriate for spatio-temporal count data with an excess number of zeros. The developed regression framework does incorporate serial correlation and time varying covariates through an Ornstein Uhlenbeck process formulation. In addition, we explore the effect of different priors, including default options and variations of mixtures of g-priors. The effect of different distance kernels for the epidemic model component is investigated. We proceed by developing branching process-based methods for testing scenarios for disease control, thus linking traditional epidemiological models with stochastic epidemic processes, useful in policy-focused decision making. The approach is illustrated with an application to a sheep pox dataset from the Evros region, Greece.
    Keywords: Bayesian modelling; Bayesian variable selection; branching process; epidemic extinction; g-prior; spatial kernel; disease control
    JEL: C1
    Date: 2017–06–12
  21. By: Paolo Crosetto (GAEL - Laboratoire d'Economie Appliquée de Grenoble - Grenoble INP - Institut polytechnique de Grenoble - Grenoble Institute of Technology - INRA - Institut National de la Recherche Agronomique - CNRS - Centre National de la Recherche Scientifique - UGA - Université Grenoble Alpes, INRA - Institut National de la Recherche Agronomique); Anne Lacroix (GAEL - Laboratoire d'Economie Appliquée de Grenoble - Grenoble INP - Institut polytechnique de Grenoble - Grenoble Institute of Technology - INRA - Institut National de la Recherche Agronomique - CNRS - Centre National de la Recherche Scientifique - UGA - Université Grenoble Alpes, INRA - Institut National de la Recherche Agronomique); Laurent Muller (GAEL - Laboratoire d'Economie Appliquée de Grenoble - Grenoble INP - Institut polytechnique de Grenoble - Grenoble Institute of Technology - INRA - Institut National de la Recherche Agronomique - CNRS - Centre National de la Recherche Scientifique - UGA - Université Grenoble Alpes, INRA - Institut National de la Recherche Agronomique); Bernard Ruffieux (GAEL - Laboratoire d'Economie Appliquée de Grenoble - Grenoble INP - Institut polytechnique de Grenoble - Grenoble Institute of Technology - INRA - Institut National de la Recherche Agronomique - CNRS - Centre National de la Recherche Scientifique - UGA - Université Grenoble Alpes, Grenoble INP - Institut polytechnique de Grenoble - Grenoble Institute of Technology)
    Abstract: We study in a laboratory framed field experiment the impact of five Front of Pack labels (FOPL) on the nutritional quality and cost of a daily consumption basket. We employ a difference in difference experimental design, between subjects, to cleanly identify the impact of FOPL. 691 subjects issued from the general population shop twice within a catalog of 290 products: a first time without and a second unan-nounced time with labels. Purchases are real. We test five different labels and compare result against a benchmark treatment in which subjects shop twice with no labels. Labels include the existing Multiple Traffic Lights, Reference Intakes and Health Star Rating, and two newly proposed designs: NutriScore, a 5-color synthetic label, and SENS, a frequency-based recommendation label. We measure nutritional quality using the FSA score. All labels but Reference Intakes significantly improve nutritional quality. NutriScore is significantly more effective than all other labels, followed by the Australian Health Star and Multiple Traffic Lights. The nutritional improvements due to the labeling come at an economic cost, as the average cost of 2000Kcal increases for all labels. Nonetheless, we show that the extra cost for a unit nutritional improvement is borne mainly by richer households. Behaviorally, change is concentrated in the extremal categories of each label. Easier to understand labels have a higher impact and crowd out more successfully other information cues like ingredients lists and nutritional tables.
    Keywords: Nutritional labels,Experiment,Front of Pack,Etiquetage nutritionnel,Economie expérimentale
    Date: 2018–06–01
  22. By: Roberta Longo (Academic Unit of Health Economics, Leeds Institute of Health Sciences, University of Leeds); Alastair Young (Leeds liver unit, St James’s University Hospital, Leeds, UK); Ian A. Rowe (Leeds liver unit, St James’s University Hospital, Leeds, UK); Rebecca L. Jones (Leeds liver unit, St James’s University Hospital, Leeds, UK); Amy Downing (Leeds Institute of Cancer and Pathology, University of Leeds, Leeds, UK); Adam Glaser (Leeds Institute of Cancer and Pathology, University of Leeds, Leeds, UK); Giles J. Toogood (Leeds Institute of Cancer and Pathology, University of Leeds, Leeds, UK)
    Abstract: Background. The efficacy of liver transplantation (LT) in treating liver disease has been established through prospective and retrospective observational studies. Although LT is now regarded as the treatment of choice for liver disease, the evidence on its cost-effectiveness is lacking. Methods. In this study we conducted a systematic review of the studies that have attempted to assess the cost-effectiveness of LT. The aim is not only to assess the value for money of this particular intervention but also to investigate the sources of evidence on probabilities, costs and quality of life values used in the economic evaluations. Results. 6 studies were included in the systematic review, of which 5 were of moderate to high quality. The systematic review identified three separate questions: 1) Cost-effectiveness of LT vs no intervention; 2) LT vs alternative treatments for hepatocellular carcinoma (HCC) and 3) type of LT, specifically donation after brain death (DBD) against donation after cardiac death (DCD). Given that randomized control trials of LT versus no transplantation are neither practical nor ethical, we find the two most common methods of investigation are decision analytic models and observational studies (prospective and retrospective). In the case of models, values for probabilities, costs and utilities are mainly derived from the literature (or expert opinion). In observational studies, instead a hypothetical comparison group is created and values for this group estimated either from prognostic models or from the patients in the waiting list for transplantation. In both cases, sources of uncertainty are multiple because of the use of many assumptions. Conclusions. The evidence reviewed suggests that LT is cost-effective when compared to no transplantation; whilst evidence on LT vs alternative treatment for HCC is inconclusive and evidence on type of LT is dependent on the data which parametrize the model.
    Keywords: Liver Transplantation, Cost-Effectiveness, Systematic Review
    JEL: I1
    Date: 2018

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