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A decade later, the gathering pace of technological development,
an aging population and other pressures on resources forced the
question: "how should we allocate our scarce resources?" to be
asked with increasing frequency. The American school of early
pioneers such as Klarman, Fein and Rice began publishing descriptive
studies called "cost-of-illness" studies dedicated to calculating
the burden to society of particular problems (e.g road traffic
accidents, mental illness, infectious diseases). In the 1970s
economists began trying to adapt evaluative techniques of classic
economics such as Cost-Benefit Analysis (CBA) to health care and
to incorporate the descriptive element of Cost-of-Illness methodology
into the analytical framework of CBA. This decade saw further
development of such techniques with the introduction of
Cost-Effectiveness Analysis (CEA). The creation in the late
1970s of a single measure of outcome combining quantity and
quality of life reflects people's preferences for health status
(the Quality-Adjusted-Life-Year or QALY - pronounced QUALY) led
to the birth of Cost-Utility-Analysis (CUA), a sibling of CEA.
There has been a steady increase in published economic evaluations
during the 1980s with a relative demise in popularity of CBA to the
advantage of CEA. This factor is probably due in part to
methodological difficulties of CBA.
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