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Costs, Direct versus Indirect

Within economic evaluation, the analysis of costs is meant to provide a valuation of the resources consumed as a result of an intervention. Such an analysis, like that involved in the valuation of outcomes, would result in different answers depending on the perspective of the analyst. The perspective adopted is, in turn, determined by the policy question that the evaluation is seeking to answer. For instance, the health sector perspective generally includes costs of treatment and cost offsets, that is, costs and cost savings to the health sector through, say, differences in hospitalizations associated with differences in outcomes between intervention alternatives. Such a perspective typically includes out-of-pocket payments incurred by patients and charges on other funders of healthcare, including government and health insurers. A ...

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