Estimating the opportunity costs of bed-days.

Sandmann, FG; Robotham, JV; Deeny, SR; Edmunds, WJ; Jit, M; (2017) Estimating the opportunity costs of bed-days. Health economics. ISSN 1057-9230 DOI:

Text - Published Version

Download (171kB) | Preview


Opportunity costs of bed-days are fundamental to understanding the value of healthcare systems. They greatly influence burden of disease estimations and economic evaluations involving stays in healthcare facilities. However, different estimation techniques employ assumptions that differ crucially in whether to consider the value of the second-best alternative use forgone, of any available alternative use, or the value of the actually chosen alternative. Informed by economic theory, this paper provides a taxonomic framework of methodologies for estimating the opportunity costs of resources. This taxonomy is then applied to bed-days by classifying existing approaches accordingly. We highlight differences in valuation between approaches and the perspective adopted, and we use our framework to appraise the assumptions and biases underlying the standard approaches that have been widely adopted mostly unquestioned in the past, such as the conventional use of reference costs and administrative accounting data. Drawing on these findings, we present a novel approach for estimating the opportunity costs of bed-days in terms of health forgone for the second-best patient, but expressed monetarily. This alternative approach effectively re-connects to the concept of choice and explicitly considers net benefits. It is broadly applicable across settings and for other resources besides bed-days.

Item Type: Article
Faculty and Department: Faculty of Epidemiology and Population Health > Dept of Infectious Disease Epidemiology
Related URLs:
PubMed ID: 29105894
Web of Science ID: 428324700016


Download activity - last 12 months
Downloads since deposit
Accesses by country - last 12 months
Accesses by referrer - last 12 months
Impact and interest
Additional statistics for this record are available via IRStats2

Actions (login required)

Edit Item Edit Item