Faculty of Medical and Health Sciences

POPLHLTH 720 - Cost Effectiveness Evaluation

15 Points

Semester 2


The application of economic methods to the evaluation of health services and programmes. The principles and techniques of economic evaluation, the process of measuring costs and benefits of health services, quality of life measurement.

Course aims

Content outline

Day 1:      

  • Economic evaluations and cost-effectiveness             
  • Decision trees
  • Costing activity using diagnosis related groups

Day 2:

  • Markov Models
  • Quality of life, QALYs and DALYs
  • Incremental analysis and uncertainty

Day 3: Deriving parameters for Probabilistic Sensitivity Analysis

Day 4: Applications of Probabilistic Sensitivity Analyses

Goals of the course

Because resources are limited and time is short, choices must be made about how to allocate resources in health care. Cost effectiveness evaluations are used at all levels of public health and clinical decision making because they provide information on whether health care initiatives represent ‘good value for money’. The course provides students with an understanding of cost effectiveness, evaluations, and experience in conducting a cost effectiveness modelling.

No knowledge of economics or health economics is required (although it is pertinent). The course is appropriate for students interested in public health and in clinical decision making. Postgraduate students who have not used Microsoft Excel previously will find elements of this course challenging. It is recommended that students have some experience with Microsoft Excel before the course commences. 

Students with the ability to carry out economic evaluations are in great demand in the health sector. Knowledge and understanding of cost effectiveness evaluations can provide students with a lucrative and rewarding career.

Learning outcomes

At the end of the course students will be able to:

  • Understand cost effectiveness analysis, including:
  • Choice of outcome measures;
  • Types of costs to include;
  • Methods for calculating cost effectiveness ratios;
  • Undertake simple cost effectiveness evaluations.

Learning and Teaching

The course occupies four full days across the semester. It is available at the Tāmaki Campus. Teaching of the course reflects the view that effective learning occurs when students are active participants rather than passive observers. The approach combines lectures, computer exercises, and discussions drawing on the experience of students and teachers.


Marks for the course will be distributed as follows: Assignment 1 (30%), Assignment 2 (50%); Assignment 3 (20%)

Campus Teaching Dates 

Please see your timetable on SSO or Building 730 Reception noticeboard on the day for the room details.

Learning Resources 

Students are provided with a course-book of any readings not readily accessible through the library or online. Messages to students and handouts are distributed through the student management programme, CECIL.

Course Coordinator

Course Administrator