Modelling for cost-effectiveness analysis.

A model creates the framework for a cost-effectiveness analysis, allowing decision makers to explore the implications of using an intervention in different ways and under different conditions. To serve its purpose a model must produce accurate predictions and allow for substantial variation in the factors 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 to 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-effectiveness analyses depend by showing the implications for resource allocation of the statistical forms conventionally used in these fields. Copyright 1999 John Wiley & Sons, Ltd.