Traditional Medicine in Asia

A framework for cost-benefit analysis of traditional medicine and conventional medicine
A framework for costbenefit
analysis of
traditional medicine and
conventional medicine
focused around issues of safety, efficacy,
standar-dization and quality control. In the
absence of serious investment in the sector
over the past two decades that this
discussion has been running, the issues
and arguments have been reiterated time
and again without any substantial impact
on policy or programmes.
Recent policy interest in this field has
added a new dimension to the discussion.
This is an economic dimension and the
emergence of economics into the TRM
policy discussion signals a new seriousness
on the part of policy-makers.
In the United States, Canada, Europe,
Australia and New Zealand, health policymakers
and medical insurers have
accepted that half or more of the public is
using some form of complementary
medicine (CM) on a regular basis and
largely paying for this ‘out-of-pocket’. In
the US, an estimated $27 billion was spent
in 1997. 1 In Australia in 1996, the
estimate was $AU621 million – more than
the amount spent on pharmaceutical
drugs. 2 Introduction
uch of the discussion on research into
M traditional medicine (TRM) has
And in the UK, it has been
estimated that £1.6 billion is spent ‘outof-pocket’
on CM annually – in addition
to the £40 billion spent by the National
Health Service. 3
As a result, the focus of policy has
shifted beyond the necessary requirements
that products and services be at least safe
and, ideally, effective. A new consideration
in assessing CM is whether CM services
are economically competitive with conventional
health services. As governments and
insurers increasingly focus on service
development in traditional and complementary
medicine, the challenge to
address basic economic questions is
becoming one of central importance.
Potential Areas of Cost
Saving in Traditional
Medicine
Gerard Bodeker
White and Ernst (2000) have outlined five
broad areas in which there may be potential
for cost savings from the use of CM 3 .
� Cost of drugs;
� Visits to a doctor;
� Secondary referral;
� Adverse events arising from conventional
therapies;
� Prevention of future disease.
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