The issue of survival consumption costs in cost-utility analysis (CUA) has been debated several times, e.g. when the Washington Panel issued their report (Gold et al., 1996) and when Meltzer (1997) published his article. But as Richardson (1990) has described, already in the 1960s there was some discussion on whether or not the appropriate quantity to be included in an economic evaluation was the full value of production or the value of net consumption. Most recently, a paper by Nyman (2004) in this journal, where he argues that survival consumption costs should not be included, has stirred a new round of debate (Nyman, 2006;Gandjour, 2006;Richardson and Olsen, 2006). Nyman also mentions that the issue is not merely theoretical any longer since at least one country, Sweden, has issued guidelines recommending that survival consumption costs should be included.
We believe that this debate keeps coming back not mainly because the technical aspects of CUA are poorly understood, even if that is one factor, but because intuition (and perhaps empirical ethics as Richardson and Olsen (2006) point out) tells us that something most people are uncomfortable with is going on when survivors' consumption is considered as a cost of a lifesaving intervention. However, much of this debate has been fairly technical. This note is an attempt to give an intuitive explanationwith the help of a parable -why we think it may be sensible to include survival consumption costs in CUA.
Thus, we disagree with Nyman's conclusion that because utility elicitation instruments do not capture utility from consumption, survivors' consumption costs should be excluded from CUA. However, we recognize that Nyman is correct in that utility elicitation instruments do not capture utility from consumption in a particularly comprehensive way. And we also agree that it is in principle inconsistent to include a consumption cost in the nominator if the utility from that consumption is not included in the denominator. The following parable may be helpful in explaining our position.
THE PARABLE
Robinson Crusoe and Friday live together on a deserted island. They lead a pretty comfortable life on the island, although they feel that the diet of eating only corn lacks variety -there are only so many ways you can prepare corn, given the low level of technology on the island.
One day they notice a venomous snake in the corn field and realize that there is a risk that one of them will be bitten while working. The bite is fatal if not treated. Luckily enough Friday, the son of a medicine man, knows of a plant that works as an antidote to the snake bite. But even if a person is treated, he will not ever be able to work again. Also, the plant is uncommon and has a limited shelf life. This means that they would have to regularly devote time to collecting the plant.