PRODUCTIVITY COSTS MEASUREMENT THROUGH QUALITY-OF-LIFE - A RESPONSE TO THE RECOMMENDATION OF THE WASHINGTON PANEL

This paper comments on the recently published guidelines of the Washin gton Panel on incorporation of indirect non-medical costs, or producti vity costs, in economic evaluations of health care. Traditionally the human capital or more recently the friction cost method is used to mea sure these costs. The Panel, however, recommends incorporating product ivity costs as health effects in the denominator of the CIE ratio. Thi s paper argues that incorporation of productivity costs in cost-effect iveness analysis expressed as health effects is not correct. Only dire ct health related effects on quality of life that cannot be meaningful ly monetarized should be considered as health effects. Furthermore, me asuring productivity costs in terms of quality of life may lead to mis representation of these costs from a societal viewpoint. This misrepre sentation occurs because of the existence of social security systems a nd private insurance compensating for income reductions from disease. Furthermore, the patient's viewpoint is useful for quality of life mea surement, but not for measuring productivity costs from a societal per spective. Finally, alternative recommendations are formulated for inco rporating societal productivity costs in economic evaluations of healt h care. (C) 1997 by John Wiley Br Sons, Ltd.