A health economic model is a conceptual, mathematical and computational representation of systems relating to human health that can be used to help solve economic problems.

A model is a simplified representation of a system of interest. In the way we use the term, we also mean that a model is:

  • abstract and general (i.e. largely free of non-modifiable data, including numeric values, that are assumption- or context- specific) and
  • a tool (i.e. a model can be used to help undertake an analysis, it is not the analysis itself).

If a model is used to help solve economic problems (e.g. those arising from scarcity) relating to health and healthcare it is a health economic model. Many health economic models are developed to inform a decision or set of decisions (e.g. relating to youth mental health policy and system design), in which case they can also be called a decision model.

Ideally, a health economic model should have three inter-related representations - conceptual, mathematical and computational.

Conceptual Model

A conceptual model refers to underlying theory and beliefs about a system of interest that can be described in words and pictures.

Mathematical Model

A mathematical model formalises a conceptual model as a set of equations.

Computational Model

A computational model implements the conceptual and mathematical models of a system of interest as computer code.

Computational models can take a modular approach to implementation.

Last modified April 27, 2023: reorganisation of docs (82bfadf)