Skip to Content
Interactive Textbook on Clinical Symptom Research Logo


Home Button

Clinical Economics Sections
Author Bio
Introduction
Model of Economic Analysis
Basic Principles of Costing
Perspectives
Types of Analysis

Currently selected section: Marginal and Incremental Analysis

Economic Efficiency
Sensitivity Analysis

Discounting

Conclusion
Case Study 1
Case Study 2
Acknowledgements


Chapter 12: Clinical Economics: Marginal and Incremental Analysis
         Comparing Marginal and Incremental Analysis

There is a subtle but important difference between marginal and incremental cost-effectiveness.

  • Marginal cost-effectiveness refers to the change in costs and health benefits from a one-unit expansion or contraction of service from a particular health care intervention (e.g. an extra day in the hospital or an extra dose of medication per day).
  • Incremental cost-effectiveness represents the change in costs and health benefits when one health care intervention is compared to an alternative one (e.g. outpatient surgery vs. short-stay surgery).
Types of analysis Considers the differences in costs and health benefits...
Marginal cost-effectiveness...within a given alternative
Incremental cost-effectiveness ...between alternatives

Average cost-effectiveness ratios do not compare the costs and outcomes among health care alternatives, but instead reflect the cost per outcome of one alternative independent of other alternatives.

For meaningful comparison in clinical economics, marginal and incremental analyses of costs and health outcomes are performed.


Page 27 of 115
      Previous Section