Valuation of Costs in Health Economics During Financial and Economic Crises: A Case Study from Lebanon

Abstract

In 2019, we embarked on a study on the economic burden of multiple sclerosis (MS) in Lebanon, in collaboration with a premier Lebanese MS center. This coincided with a triple disaster in Lebanon, comprising the drastic economic and financial crisis, the COVID-19 pandemic, and the consequences of the explosion of Beirut’s port. Specifically, the economic and financial turmoil made the valuation of costs challenging. Researchers could face similar challenges, particularly in low- and middle-income countries (LMICs) where economic crises and recessions are recurrent phenomena. This paper aims to discuss steps taken to overcome the fluctuation of the prices of resources to get a valid valuation of societal costs during times of a financial and economic crisis. In the absence of local costing data and guidelines for conducting cost-of-illness (COI) studies, this paper provides empirical recommendations on the valuation of costs that are particularly relevant in LMICs. We recommend (1) clear reporting and justification of the country-specific context, year of costing, assumptions, data sources, and valuation methods, as well as the indicators used to adjust cost for inflation during different periods of fluctuation of prices; (2) collecting prices of each resource from multiple and various sources; (3) conducting a sensitivity analysis; and (4) reporting costs in local currency and Purchasing Power Parity dollars (PPP$). Precision and transparency in reporting prices of resources and their sources are markers of the reliability of the COI studies.