I'm studying health economics and have been racking my brain trying to find the right answer to this problem, but I keep getting it wrong no matter what I do. I haven't had any trouble calculating ICER, QALY and DALY until now and none of my textbooks have examples that include discounting the costs and effects. Hopefully someone here can help before I give up.
Formula used:
There are two different treatmeants for a health injury that take place over two years:
- Treatment A: Takes place over two years, has costs and effects in both years of the treatment.
- Treatment B: Takes place in the first year and therefore only has costs in the first year, but this treatmeant has effects in the year after the intervention.
Costs of treatments
Treatment A:
1st year: 10 400 dollars
2nd year: 10 000 dollars (with a discount of 4 % applied).
Treatment B:
1st year: 28 000 dollars
2nd year: 0 dollars
Saved costs: the health injury costs 8000 dollars in the first year after the injury.
Utility value/health outcome in QALY: 0,55 in the first year after the injury.
The effects of the treatments:
Treatment A: 2 injuries avoided every year
Treatment B: 3 injuries avoided in the 1st year, and 2 injuries avoided in the 2nd year.
A discount of 4 % has to be applied to all costs and health outcomes/effects, but only to the the second year, not the first year. This is one of the issues I'm having. I don't know which numbers to apply the discount to. I also can't figure out how much is saved in costs by preventing injury.