Q&A Session

This guide serves as a review of material covered in the pharmacoeconomics lectures.
It contains much information but is not exhaustive and should not replace lectures.
This is merely a review packet; studying solely from it likely will not suffice for optimal grades.
Students are encouraged to view the slide set as a presentation to avoid pre-seeing answers; some are located on slides following the questions.

Additional practice questions can be found in a document titled “Review Packet- QUESTIONS.”
Answers to these questions are in the document titled “Review Packet- ANSWER KEY.” Both documents are accessible via Blackboard (Bb).

Familiarize yourself with the Pharmacoeconomics List of Terms in Blackboard.
- Terms are arranged by chapter, indicating their usage in lectures and course texts.
- Some terms may appear across multiple chapters.
- Understanding these terms significantly enhances exam question comprehension.

Memorization of equations is not required.
Understanding their usage is imperative. Each exam question will include an equation sheet in ExamSoft.
Scrap paper will be allowed during the exam for calculations.

Only the calculator integrated in ExamSoft will be accessible.
Personal handheld calculators, phones, or other electronic devices are prohibited during the exam.

Expect to encounter 25 questions in a 70-minute timeframe.
- Although this allows almost 3 minutes per question, some will include a short paragraph for context.
- Calculation-based questions will require efficient time management.
- If slow at reading, monitoring pacing is essential.

All exam questions will be multiple-choice.
- Questions include recall (terminology and principles) and application scenarios.
- Some specify calculations, while others will require inference on necessary calculations.
- Expect a mix of simple and complex questions.

Read each question attentively; crucial information will be present.
- Comprehension of terms and principles ties back to the Pharmacoeconomics List of Terms.
- Avoid overthinking; the exam is structured plainly, without intended tricks.

Comprehend the pharmacoeconomic equation and its significance.
Identify scenarios suitable for pharmacoeconomic analysis.
Familiarize with types of pharmacoeconomic test methodologies.
Understand financial challenges facing the U.S. healthcare system.
Recognize differences between the U.S. healthcare system and others, including varying uses of pharmacoeconomics.

Familiarity with various cost-related terminologies is necessary.
Be able to describe four types of costs:
- Direct Medical Costs: Costs directly related to medical care.
- Direct Nonmedical Costs: Costs associated with obtaining medical care (e.g., transportation).
- Indirect Medical Costs: Costs resulting from loss of productivity due to illness.
- Intangible Costs: Non-quantifiable costs like pain or reduced quality of life.
Explain the role of perspective in pharmacoeconomic evaluations.
Understand standardization and discounting utilities in economic evaluations.
Be capable of performing and interpreting Incremental Cost-Effectiveness Ratio (ICER) calculations.
Recognize different medication cost types (e.g., AWP, WAC).
Identify methodologies for determining hospitalization costs.

Describe, perform, and interpret cost minimization analysis.
Conduct sensitivity analysis, understanding its purpose and methodology.
Execute cost-benefit analysis, articulating benefits and cost considerations in health interventions.
Understand willingness-to-pay methods and human capital approaches to assess value.
Calculate net benefit, benefit-to-cost ratios, and internal rate of return.

Q1: Which of the following BEST describes opportunity cost?
- Answer: The cost of the “best” option over the “next best option.”
Q2: What type of costs does loss of productivity from illness or death represent?
- A. Direct medical costs
- B. Direct nonmedical costs
- C. Indirect medical costs
- D. Intangible costs (Correct Answer: C)

The ICER formula is given as:
ICER = \frac{\text{Difference in costs between 2 options}}{\text{Difference in outcomes between 2 options}}
It quantifies the extra cost required to achieve one additional unit of benefit (e.g., quality-adjusted life year).
Remember: an ICER > 1 indicates a more beneficial intervention.

Understand the significance and calculation methodology for QALYs in pharmacoeconomic studies.
Familiarize with methods for determining health utility (e.g., standard gamble, time trade-off).
Ability to calculate QALYs based on interventions and their associated outcomes.

Define the purpose of a Markov model in evaluating treatment pathways.
Understand states in Markov models, including absorbing and transient states, as well as transition probabilities.

Further practice questions and case studies are available in Bb.
Use suggested websites for additional test preparation, but proceed with caution as they may differ from class material.

Prepare thoroughly for the exam: be ready to face multiple-choice questions requiring a robust understanding of principles and calculations in pharmacoeconomics.