Training program costing example, Schemes and Mind Maps of Financial Statement Analysis

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Training program

costing example

Marcia Weaver, PhD Research Associate Professor Institute for Health Metrics and Evaluation (IHME) October 13, 2016

Learning objectives

Following this session, participants will:

1. Correctly explain how five principles of cost

analysis can be applied to a training program

2. Interpret results of the cost-effectiveness

analysis for the Integrated Infectious Disease

Capacity-Building Evaluation (IDCAP)

1. Perspective

Perspective is the point of view from which the costs are calculated. It addresses the issue of which inputs or resources to include.

• Training program budget for your organization
• Donor, which includes other partners they support
• Societal, which includes opportunity costs

Cost per unit 5 - day computer- based training plus 3 - day workshop 10 - day training plus on-site visits Units Cost Units Cost Trainer $100 per day

On-site $1, per site

[..]

Training program budget

Training program budget

Cost per unit 5 - day computer – based training plus 3 - day workshop 10 - day training plus on-site visits Units Cost Units Cost Training pro- gram budget

Contract with venue

per day

Trainees’ time $20 per day

Total cost $12,025 $20, Societal perspective

Cost per unit 5 - day computer – based training plus 3 - day workshop 10 - day training plus on-site visits Units Cost Units Cost Training pro- gram budget

Contract with venue

per day

Trainees’ time $20 per day

Total cost $12,025 $20, Cost/trainee 25 $481 25 $ Societal perspective

3. Output vs. outcome

1. The cost per unit of output is valid when the

two programs being compared are equally

effective.

2. A cost per unit of outcome can address

differences in effectiveness across programs.

3. The scope of the analysis is determined by the

denominator. Only programs with a common

denominator can be compared.

Cost per unit of output

5 - day computer- based training plus 3 - day workshop 10 - day training plus on-site Cost of transfer of learning Training $12,025 $20, Supervision $8,000 $2, Total cost $20,025 $22,

Cost per unit of intermediate outcome 5 - day computer- based training plus 3- day workshop 10 - day training plus on-site Cost of transfer of learning Training $12,025 $20, Supervision 8,000 $2, Total cost 20,025 $22, Trainees who meet standard 15 22 Cost per trainee who met standard $20,025/15 = $1,335 $22,000/22 = $1,

Cost analysis: Compares the cost per unit of

output when to programs are equally effective

Cost-effectiveness analysis (CEA) : Compares

cost to effectiveness, e.g.

• Clinician who meets standard
• $/life years saved from intervention

ICER is a slope

Health Care Cost Health outcomes Health Benefits

PMTCT Cost/HIV infection averted Pre-training Post-training Program cost Remuneration $80,000 $84, Supplies 15,000 18, Capital 5,000 10, Total Cost $100,000 $112, Number of mother-infant pairs 1,000 1, Base case-vertical transmission 25% 25% Number of HIV infections averted 1,000.25.63=158 1,200.25.63= Incremental cost $112,000 - $100,000 = $12, Incremental effectiveness 189 – 158 = 31 ICER $12,000/31 = $

5. Sensitivity analysis

• Calculation of alternative cost-effectiveness results

when there is uncertainty about one or more

parameters.

• It shows the extent to which uncertainty about a

parameter would substantially affect the estimate.

PMTCT CEA with uncertainty

Pre-training Post-training Total Cost $100,000 $112, Number of mother-infant pairs 1,000 1, Base case-vertical transmission 25% 25% Lower bound 19% 19% Upper bound 30% 30% Incremental cost $112,000 - $100,000 = $12, ICER – base case $12,000/31 = $ Lower bound $12,000/24 = $ Upper bound $12,000/38 = $