Given that public sector budgets are increasingly stretched to meet competing demands, there is a growing need to analyze and report on the costs and benefits of public sector investments. Economic evaluation of costs, benefits and effects provides a valuable framework for thinking about choices in healthcare. Economic evaluation asks the question: "is this procedure, service or programme worth doing when compared with other things we could do with the same resources?" or "What are the benefits from  this treatment or from this programme and what are the costs, and do the former exceed the latter?"

Oral diseases pose a significant burden on the economy of both the industrialized and emerging states. The prevention of dental caries - a major oral disease - by fluoride has been well proven over the last 50 years world-wide. Water fluoridation has long been considered the most effective of the fluoridation methods. In this article, the authors examined several modalities of caries prevention through fluoride use - water fluoridation, salt fluoridation, school fluoride rinse programmes, fluoride tablet programmes, fluoride toothpaste, and professionally applied fluorides - and predict benefits, effects, and costs in Kuwait. Salt fluoridation, water fluoridation, and fluoride tablets provide maximal benefits, while salt fluoridation provides the best cost/effect ratio. Salt fluoridation also provides the consuíer the option of whether to use it or not, while also shifting the burden of cost from the public sector to the consumer. Salt fluoridation has proven highly successful in Switzerland, and France has recently become the leading producer of fluoridated salt. The results predicted here can allow the decision-maker the choices of whether to accept or reject alternative and competing fluoride disease prevention modalities taking into consideration benefits, costs, public perceptions and the cost either to the public sector or the consumer.
 

All countries regardless of their stage of development, face difficult choices in the allocation of resources to competing activities.

Expenditure decisions in the public sector are the result of the interaction of social, economic, cultural and political factors within existing organizational structures. Given that public sector budgets   are   increasingly stretched to meet competing demands, there is a growing need to analyze and report on the costs and benefits of public sector investments. Economic evaluation (costs, benefits, effects of invest- ments) provides a valuable framework for thinking about choices in health care.¹

Economic evaluation asks the question: "Is this procedure, service or programme worth doing when compared with other things we could do with the same resources?" or "What are the benefits from this treatment or from this programme and what are the costs, and do the former exceed the latter?"²

The organized consideration of multiple factors involved in the decision to commit scarce' monetary resources is then available to the decision-maker, rather than the reliance on or application of simple intuitive or "gut" feelings. Economic evaluation can be useful in illuminating issues and helping policy makers arrive at informed decisions.³

The distinguishing feature of economic evaluation has its basis in the notion of 'scarcity' (Table 1). That is, resources in society are insufficient to allow for the pursuit of all desirable objectives.⁴ For instance, while the eradication of oral diseases is a noble goal, it does not necessarily follow that either adequate resources are available or that society is willing to commit such resources, while foregoing other opportunities to improve society.

Oral diseases pose a significant burden on the economy of both the industrialized and emerging states.⁵ The prevention of dental caries - a major oral disease - by fluoride has been well proven over the last 50 years world- wide.⁶⁸ In this article, the authors examined different modalities of prevention of diseases through fluoride use and predict benefits, effects, and costs in the Gulf States. Water fluoridation, salt fluoridation, school fluoride rinse programmes, fluoride tablet programmes, fluoride toothpastes, professionally applied fluorides, and sealants with and without the parallel use of daily fluoride supplements were evaluated. Predicted results for salt fluoridation to determine the 'sensitivity' of the results by varying one parameter were also re-examined. This sensitivity analysis allows consideration for potential uncertainties in the variables.²  

Differing interventions implemented in Kuwait are examined including the decision to stop the fluoridation of water in the early 1980s.
  

Average costs were determined by a search of the literature through market analysis, and supplier estimates, and costing reports of contracted health programmes in Kuwait. The efficacy of each intervention (% of caries reduction) is based on published international data. Expected or projected disease data is based on 1984 and 1993 national oral health surveys undertaken in Kuwait, with an assumption that at age 20 years, the decayed, missing and filled permanent teeth (DMFT) would be the same as observed in 1984. To carry out the economic evaluation of costs versus benefits, the Net Present Value formula was used for analysis   of   each intervention's costs and benefits. A benefit/cost ratio and a cost/effect ratio were then determined. While some costs are available at the Gulf States level, the authors also used international data for purpose of analysis. The discount rate of 5% was used in the calculation (Table 2). For this analysis, costs from birth up to age 20 years were examined. In the case of salt fluoridation, a sensitivity analysis varying one parameter - cost to the consumer - was carried out.
 

Table 3 provides estimates of annual costs for different preventive fluoride modalities in different countries. In the analysis, it is important to note that costs can be incurred either in the private sector or the public sector- while this does not affect the economic evaluation, it can weigh on the decision making process. When public sector budgets are restrained, as is the present case in the Gulf States, it may be quite appropriate to transfer small costs to the individual. This holds true for salt fluoridation and bottled fluoridated water in our analysis. Both of these interventions can be paid for by either the consumer directly or by the State through subsidies.

Table 4 provides an estimate of benefits accrued in the form of reduced disease (caries) based on known disease rates in Kuwait. A dollar value is placed on these benefits. By design, the Benefit/Cost results (B/C ratios) are an undervaluation because many other benefits are not included, as it is difficult or near impossible to place a monetary value on these other benefits. Several such benefits are listed in Table 5.

A sensitivity analysis of the salt fluoridation results (Table 6) was carried out by changing the value of one parameter - the cost to consumer.

As the costs increase to the consumer, the B/C ratio is significantly reduced, but remains favourable vis-a-vis other interventions.
 

The efficacies of these interventions are well established.⁶¹¹ The "effectiveness" in the community and the final benefits to the commu- nity can differ from the expected efficacy, based on a plethora of variables: provider compliance, patient    compliance,   coverage,    accuracy of application, etc. It is this "community effective- ness" that is of interest to the health planner as an end measure of the intervention efficacy in a particular situation based on one or more such variables. In Table 7, hypothetical examples of the change in community effectiveness for some health interventions when certain para- meters are adjusted are given. With sealants, community effectiveness by improving such variables as provider compliance, patient compliance, provider diagnosis, or passive fluoridation can be improved. Once the poten- tial community effectiveness is determined, the economist or health planner must examine the Benefit/Cost ratio and the Cost/Effect ratio, in order to provide the decision makers with the appropriate information for planning and implementation. Cost-Effectiveness Analysis is the simpler of the two analyses. Cost-Benefit Analysis is more difficult as it places a monetary value on all benefits, which is impossible or near impossible in some situations.

A simplified working formula for this type of analysis is the Net Present Value¹² formula:



where   B = all benefits, C = all costs, n = number of years of the programme, r = discount rate.

The 'discount rate' is used to allow comparison of benefits and costs that are generated in different years.⁴ Britain publishes the public sector discount rate to be used in evaluations of this type (4-6%).¹ The discount rate can vary by definition; the World Bank defines it as social accounting rate of interest (SARI) - today's interest rate less today's inflation rate.² The authors "discounted" future costs and benefits back to the present.⁴ If the sum of the benefits is greater than the sum of the costs, the intervention examined could be acceptable.
When making an intervention decision based on an available fixed budget, the decision rule is to accept (A) the maximum benefits program or (B) the least costs program, depending on factors within the political, economic, and health sectors. Based on the analysis here, maximum benefits would be similar for water fluoridation, salt fluoridation or fluoride tablets. In economic terms, salt fluoridation would provide the greatest economic savings (C/E ratio) while still maximising benefits to the community (B/C ratio). In establishing the cost to the consumer of fluoridated salt, the authors are concerned only with the 'marginal' costs, i.e. the additional costs of the added fluoride, as all consumers can be considered salt purchasers. This can also be true for bottled water if the individual is a regular consumer. For community water, the authors are also interested in the marginal costs.

Water fluoridation and fluoride tablets would be the next best alternatives, respectively. In each of these three interventions, benefits are maximised. Alternatively, a decision might be made to minimize costs, for example, in the school based oral health care programmes of Kuwait, with two possible alternatives: (a) tablets or (b) rinses. In this scenario, rinses have a lower Cost/Effect (C/E) ratio, but also less total benefits. Within a fixed budget for the school based oral health care programme, the additional decision might be to maximize disease prevention benefits by reducing expenditures in other areas, and shifting the saved financial resources to the Fluoride Tablet Programme in order to garner the additional benefits for society.

In Kuwait, a decision was reached in 1980 to cease the fluoridation of water. A 30% rise in the caries index in children born after 1980 with a concurrent decrease in the number of children free of caries has been observed (Figs. 1,2).¹³ An increase in caries from the 4.5D at age 20 seen in 1984 to 6.0D in the next few years is expected. Increased treatment costs borne by both the private and public sector and a loss of the benefits discussed to the individual and to society can also be logically expected.

In the decision-making process, all benefits and all costs should be weighed. In health, this presents a difficulty in that many benefits are abstract in nature and a monetary value cannot easily be attached. In the analysis, the authors only cost the value of a saved filling. However, these other benefits (Table 5) have a clear value to society. Where the B/C ratio is close to 1/1 or below, then these added "unvalued" benefits can improve the B/C ratio in favour of choosing a program over rejecting it as "too costly" for the explicit monetary benefits generated (i.e. saved fillings).⁴-¹² The use of fluoridated toothpaste is an example of this, as is the application of sealants. Sealants are not considered a cost effective procedure in public health programmes if the only variable factored in is the saved filling (Table 4). When other possible benefits are factored in, the B/C and C/E ratios may become favourable. In the private sector, "willingness to pay" by the consumer for sealants can be used to evaluate the value of this intervention. The "willingness to pay" concept can be a proxy in monetary terms for the perceived benefits valued by society. This concept, however, has limited value in a society where individual resources are severely limited.²

The results for each fluoride intervention can be re-examined to test the sensitivity of the results. As salt is clearly the most cost effective, the authors changed one parameter -the cost to the consumer- to test the results, and salt fluoridation remains the most favourable intervention. While several variables (comp- liance, consumption, costs, efficacy) can be examined, most attempts to deal with the precision of such variables create more prob- lems than they solve.¹⁴

The results predicted from this economic analysis can allow the decision-maker the choices of whether to accept or to reject alternative and competing fluoride disease prevention modalities, based on the organized consideration of multiple factors.

In conclusion, economic evaluation provides the decision-maker choices to accept or reject alternative and competing fluoride disease prevention modalities. The decision-maker can weigh maximum benefits versus total costs versus least costs. The ratios are examined and based on priorities, differing interventions can be accepted or rejected. The authors' preliminary analysis indicate that fluoridated salt maximizes benefits and provides the least cost alternative within the Gulf States. While fluoridated salt has not been considered in the past as a viable option for the region, it provides a simplified and less costly alternative to other noted methods. Salt is readily available in the Gulf States as a by-product of water desalination. The quality is excellent and the fluoridation process is simple. An additional valuable benefit is that consumption of fluoridated salt is a voluntary activity by the consumer, thus removing a negative argument used against public water fluoridation. Fluoridated salt now reaches some 85% of the public in Switzerland,¹⁵ and France has become the largest producer of fluoridated salt. These results from Europe confirm that, given the choice, the informed public will protect its oral health through the consumption of fluoride supplements in a suitable vehicle.

Economic evaluation is not an exact science. However, its merits are in making all relevant costs and benefits explicit, together with any value judgements, thus contributing to more informed choices for the final decision maker. It aims to ensure that resources are put to their most valuable use for society. Economic evaluation cannot tell us what health programs society should pursue, what preventive programmes we should adopt. These answers are up to society,' and are based on political, social, ethical as well as technical and economic considerations.