Health dynamics, adaptation to illness and resource allocation

Abstract

The increased availability of panel data has made it possible to estimate and measure health dynamics for population subgroups who may have systematically different levels of dynamics. We use a straightforward hypothetical example to investigate the implications of different levels of health dynamics on health outcomes, considering in addition the effects of adaptation to illness over time. The results demonstrate implications for the assessment of health technologies.

Keywords:

• health dynamics
• panel data
• quality-adjusted life years
• adaptation
• response shift

JEL Classification:

• I10
• I18
• D6
• H4
• C0

Acknowledgements

KH and BH acknowledge funding from the Australian Research Council Discovery grant scheme and from the Victorian Health Promotion Foundation. We are grateful for comments from Aki Tsuchiya.

All remaining errors are the sole responsibility of the authors.

Notes

¹One example is a study on positive and negative adaptations to fibromyalgia (Lindberg and Iwarsson, 2002).