Decision Tree

A diagrammatic representation of a decision analysis in which chains of choices are identified, each conditional on a prior choice and with outcomes and probabilities built in. In the figure, ■ indicates a decision node, • indicates a chance node and A indicates an end node. In this decision tree, the issue is whether to give therapy. If it is given (the Rx group), there is a probability p of life and of 1-p of death. In the untreated (control) group there is a probability r of life and 1-r of death. Of the surviving patients in either arm, they may become inpatients or treatment may no longer be needed

Defined Daily Dose 89

Defined Daily Dose 89

beyond a certain point. If the costs of the therapy, and the probabilities of life or death, and the probabilities that living patients will become hospitalized or no longer need treatment, together with the costs of these options (for both arms), are known then the (probable) cost-effectiveness of the two courses of action may be computed.

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