An introduction to costing and the types of costs used within health economic studies
File(s)
Published version
Author(s)
Turner, Hugo
Rivillas-Garcia, Juan Carlos
Prinja, Shankar
Hung, Trinh Manh
Dabak, Saudamini Vishwanath
Type
Journal Article
Abstract
The number of published health economic analyses, especially economic evaluations, has rapidly expanded globally since the 1990s, and costs are an essential component of such studies. Cost is a general term that refers to the value of the resources/inputs used to produce a good or service. However, within health economics, there are several different types of costs (such as financial, economic, unit, average, etc). The terminology and application of these cost types often differ, leading to inconsistencies in the health economics literature. These inconsistencies create challenges in comparing studies and hinder the use of health economic analyses to effectively inform policy decisions. This paper aims to provide an up-to-date overview of the cost types, key cost terms, and definitions of different cost measures used within health economics, while highlighting key inconsistencies in the literature. We also discuss common adjustments made to cost data, such as accounting for inflation, discounting, and currency conversions, as well as the influence of economies of scale and scope on cost estimates. We highlight the different definitions/categories for the different types of costs are not mutually exclusive and that the type of cost that should be used will depend on the purpose of the study, highlighting recommendations of what to do in practice where relevant. The content was tailored to be relevant across both high-income and low and middle-income (LMIC) country contexts.
Date Issued
2025-11-01
Date Acceptance
2025-08-18
Citation
PharmacoEconomics - Open, 2025, 9 (6), pp.849-868
ISSN
2509-4254
Publisher
Adis, Springer Healthcare
Start Page
849
End Page
868
Journal / Book Title
PharmacoEconomics - Open
Volume
9
Issue
6
Copyright Statement
© The Author(s) 2025. This article is licensed under a Creative Commons Attribution 4.0 International License, which permits use, sharing, adaptation, distribution and reproduction in any medium or format, as long as you give appropriate credit to the original author(s) and the source, provide a link to the Creative Commons licence, and indicate if changes were made. The images or other third party material in this article are included in the article's Creative Commons licence, unless indicated otherwise in a credit line to the material. If material is not included in the article's Creative Commons licence and your intended use is not permitted by statutory regulation or exceeds the permitted use, you will need to obtain permission directly from the copyright holder. To view a copy of this licence, visit http://creativecommons.org/licenses/by/4.0/.
License URL
Identifier
10.1007/s41669-025-00602-1
Publication Status
Published
Date Publish Online
2025-10-20