Cost-effectiveness analysis helps identify ways to redirect resources to achieve more. It demonstrates not only the utility of allocating resources from ineffective to effective interventions, but also the utility of allocating resources from less to more cost-effective interventions.

Why is cost-effectiveness important in business?

Cost efficiency is one aspect of financial management and business that can become quite confusing. ... Increase your cost efficiency, but offer the same or lower quality or lower price. This increases your profits for the same price, positioning you as a low-cost provider.

Why is cost-effectiveness important in healthcare?

Cost effectiveness analysis ( CEA ) is one type of economic evaluation that compares the costs and effects of alternative health interventions. ... CEA results can help decision-makers who want to achieve a specific health objective.