Decisions made in the health care system directly impact the quality and length of people’s lives. Therefore, the cost of errors in this area is very high, especially in conditions of limited budgets. Health economic modelling (https://digitalho.com/health-economic-modelling/) helps to make the best decision. Still, there are often many uncertainties in simulation models developed by specialists on which the result of innovations depends: the greater their number, the more likely combinations of outcomes. Accordingly, the greater the risk that the solution calculated by the model as optimal, in reality, will be far from the best.
Collecting new data can reduce the number of such uncertainties and thus help make a more effective decision. However, this process may also require additional funding. How useful and effective it will be to organize and conduct new research to obtain additional data can be calculated with a value of information analysis (VOI).
What is the Value of Information Analysis (VOI)?
Value of information analysis is a tool that allows you to quantify and estimate the benefit gained by reducing the number of uncertainties of the input parameters in the simulation model and making the analytical calculations more accurate. In other words, VOI allows you to estimate the financial benefit of organizing new research projects.
Such a calculation is practical if collecting new data to reduce uncertainties involves costly epidemiological, clinical, or socioeconomic studies. Thus, VOI is a useful economic analysis tool for assessing and optimizing the costs and benefits associated with research activities.
VOI in Health Care
Cost-benefit analysis, a key tool for health care decision-makers, is often conducted in the early stages of new medical technology or drug development. Consequently, it may be based on incomplete or inaccurate data, and have a huge margin of error between the expected and actual outcome of introducing a new product to the market.
Additional studies can collect more data and make the prediction of the economic model more accurate. But whether such refinement is worth the investment is always a question. VOI analysis is just the right way to assess the value of additional research in monetary terms. In addition, the information obtained through VOI is used in the healthcare industry to:
- ranking and prioritizing research;
- identifying the factors that have the most significant impact on the results of the economic analysis;
- creating an effective research design;
- documenting financial reimbursements.
Thus, VOI can be useful for making optimal decisions at any product lifecycle stage.
What you need to calculate VOI
VOI is a tool for making decisions that ultimately affect people’s quality of life. Therefore, it is better to entrust the calculation of the value of complete information, and the expected improvement in management results that can be achieved by eliminating uncertainty to professionals. As a result, many consulting companies now provide such a service. As a rule, the research team in such companies includes not only economists trained in decision analysis methods but also medics with experience in scientific activities.
In analyzing the value of the information, the researchers will determine
- how much data on the topic under study already exists (the less there is, the greater the need to collect new data);
- how additional information affects the process under study;
- how accurate and correct is the information that can be obtained through additional research (calculate the sample size, calculation error, time delays, etc.).
The process of analyzing the value of information includes several key steps:
- formulating research goals and objectives;
- definition of the set of available management actions;
- formulation of a set of hypotheses to be confirmed in the study;
- formulation of expected results;
- selection of economic research tools.
As a rule, the results are formatted in the form of spreadsheets and visual diagrams, which can be provided as additional information at negotiations and meetings in the decision-making process.