Modelling for cost-effectiveness analysis

A model creates the framework for a cost-effectiveness analysis, allowing d ecision makers to explore the implications of using an intervention in diff erent ways and under different conditions. To serve its purpose a model mus t produce accurate predictions and allow for substantial variation in the f actors that influence costs and effects. This paper considers three aspects of modelling: validating effectiveness estimates; modelling costs; and the implications of common statistical forms. Validation procedures similar to those for effectiveness estimates are proposed for costs. Modellers need t o pay more attention to ensuring that the pathway of events described by a model represents costs as well as it does effects. Modellers can also help improve the epidemiological and clinical research on which cost-effectivene ss analyses depend by showing the implications for resource allocation of t he statistical forms conventionally used in these fields. Copyright (C) 199 9 John Wiley & Sons, Ltd.