Program budgeting and marginal analysis: A case study in chronic airflow limitation

Abstract

Program budgeting and marginal analysis is a method of priority-setting in health care. Thisarticle describes how this method was applied to the management of a disease-specific group,chronic airflow limitation. A sub-program flow chart clarified the major cost drivers. Afterassessment of the technical efficiency of the sub-programs and careful and detailed analysis,incremental and decremental wish lists of activities were established. Program budgeting andmarginal analysis provides a framework for rational resource allocation. The nurturing ofa vigorous program management group, with members representing all participants in theprocess (including patients/consumers), is the key to a successful outcome.