Increment NHB calculation: Incremental Effect 3, Incremental Cost 12, WTP 4. NHB equals 0. Which option is correct?

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Study for the WHEBP Evidence as it Relates to Cost Test. Use flashcards and multiple-choice questions, with explanations and hints. Prepare for your exam efficiently!

Multiple Choice

Increment NHB calculation: Incremental Effect 3, Incremental Cost 12, WTP 4. NHB equals 0. Which option is correct?

Explanation:
Net health benefit is found by converting costs into health units using the willingness-to-pay (WTP) per unit of health, then subtracting those converted costs from the incremental effect. Here the incremental effect is 3 units. The incremental cost is 12, and with a WTP of 4 per unit, the cost in health units is 12 / 4 = 3. So the NHB = 3 − 3 = 0. A zero NHB means the new option is at the threshold of being cost-effective at this WTP—it's indifferent to the alternative.

Net health benefit is found by converting costs into health units using the willingness-to-pay (WTP) per unit of health, then subtracting those converted costs from the incremental effect. Here the incremental effect is 3 units. The incremental cost is 12, and with a WTP of 4 per unit, the cost in health units is 12 / 4 = 3. So the NHB = 3 − 3 = 0. A zero NHB means the new option is at the threshold of being cost-effective at this WTP—it's indifferent to the alternative.

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