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Evaluating cost-effectiveness in mental health care

It is neither fad nor fashion but the harsh economic realities of the late 20th century which prompt the growing interest in the cost-effectiveness or efficiency of mental health care treatments and services. The underlying context in most countries is not new: there are still many people with psychiatric and other health problems not receiving adequate, appropriate or effective care. However, overlaying this context are new social and economic pressures, new pharmaceutical developments and changing political priorities, each of them giving added impetus to the search for cost-effectiveness. Economic evaluation differs from other evaluative techniques in its examination of a wider range of causes and effects. The common aim of all evaluative research is to enquire if a particular intervention, project or course of action is worthwhile. The difference between economic and other evaluations is the meaning of «worthwhile». Economic evaluations add the resource or cost dimension, but they are not confined to costs. Economists use the term «cost-effectiveness» to mean the examination of both costs and effects (or outcomes) and not as a euphemism for «cheap». Economic evaluations combine outcome and costs data most commonly in four modes: cost analysis, cost-effectiveness analysis, cost-benefit analysis and cost-utility analysis (Drummond et ah, 1987; Knapp, 1995). Each of these modes sets out to