Cost Benefit Analysis in Healthcare

788 Words4 Pages
Reflection Journal: Cost/benefit of Sustaining Life Social and Organizational Issues in Healthcare Southern New Hampshire University Written by: Pratikkumar Patel The economic evaluation of health and environmental interventions for sustaining a life is becoming increasingly important. In the light of limited funding, such evaluations can provide an important tool to demonstrate the economic return of investments in intervention, compare the effectiveness of one intervention against another and help policy-makers allocate their limited budget. As I see my career as a Healthcare Administrator, it is important for me to know method of economic evaluation that values all benefits against all costs. The resulting cost-benefit ratio gives an indication of whether or not the benefits outweigh the costs of an intervention, and hence provides a decision-making tool with a broad societal perspective. In this journal, I will be reflecting about how insurance companies, hospitals, and patients can use Cost-benefit analysis for sustaining a life. First and foremost, Insurance companies routinely use cost-benefit analysis in healthcare to set policies and decide whether to approve claims. Many companies have blanket policies on general treatments, to either approve or deny them. If the cost is unacceptably high and the benefit is marginal or low, the company may deny treatment. In the event of an appeal, it can perform a more rigorous analysis of the situation. For example, a cancer patient who will die may not receive approval for a medication that adds two weeks of life, on the grounds that the drug is expensive and the benefit is minimal. Hospitals and clinics can use cost-benefit analysis in healthcare to make policy decisions as well. An obligation to treat patients at serious risk of death is present in many regions, but hospitals can be selective about the kind
Open Document