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By Alan Earl-Slater

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Extra info for Dictionary of Health Economics

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See ASTRO-PU; General Practice Research Database; PACT; STAR-PU. Decision tree An analytical framework representing choices available, outcomes and probabilities of achieving those outcomes. Suppose the patient has a choice between two alternative courses of action: treatment regime A or treatment regime B. If she chooses regime A then she may secure outcome '1' with a probability of X or outcome '2' with a probability of 1–X. If, however, she chooses regime B then she may secure outcome '3' with a probability of Y or outcome '4' with a probability of 1–Y.

Suppose a patient has a hip replacement. An external benefit of this would be the effect that intervention has on her carer to reduce the amount or type of care they now have to give. For example, before the operation the patient may have been getting help with her weekly shopping and housekeeping from her family or a care agency. Once she has had the operation she usually no longer needs such assistance. It can be argued that the existence of external benefits are not fully acknowledged in healthcare purchasers' priority setting where they only look at the patient and not the patient's more holistic circumstances.

Other examples include the ease of switching between anti-arthritis medications or in switching between acid suppressant proton pump inhibitors. Beyond medicines the term can relate to the degree of ease in switching patients between hospitals, switching between consultants or switching more generally between care programmes. See Cross price elasticity of demand; Cross price elasticity of supply; Elasticity. Elasticity of supply The responsiveness of supply to changes in factors that could affect supply.

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