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Is the Choice of Cost-Effectiveness Threshold in Cost-Utility Analysis Endogenous to the Resulting Value of Technology? A Systematic Review

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  • William V. Padula

    (University of Southern California
    University of Southern California)

  • Hui-Han Chen

    (University of North Carolina)

  • Charles E. Phelps

    (University of Rochester)

Abstract

Background Cost-utility analysis (CUA) is widely used for health technology assessment; however, concerns exist that cost-utility analysts may suggest higher cost-effectiveness thresholds (CETs) to compensate for technologies of relatively lower value. Objective We explored whether selection of a CUA study’s CET was endogenous to estimated incremental cost-effectiveness ratios (ICERs). Methods We systematically reviewed the US cost-effectiveness literature between 2000 and 2017 where studies with explicit CET and ICERs were included. We classified the ratio of studies hypothesized to analyze cost-effective technologies at low CETs (i.e., less than $100,000/quality-adjusted life-year [QALY]) vs higher CETs (i.e., $100,000–$150,000/QALY) relative to their ICER, using a Chi square test to examine whether technologies that were cost effective at high CETs would still be cost effective at lower thresholds. We also performed fixed-effects linear regression exploring the associations between ICERs and reported CETs over time. Results Among 317 ICERs reviewed: (A) 185 had an ICER

Suggested Citation

  • William V. Padula & Hui-Han Chen & Charles E. Phelps, 2021. "Is the Choice of Cost-Effectiveness Threshold in Cost-Utility Analysis Endogenous to the Resulting Value of Technology? A Systematic Review," Applied Health Economics and Health Policy, Springer, vol. 19(2), pages 155-162, March.
    • Handle: RePEc:spr:aphecp:v:19:y:2021:i:2:d:10.1007_s40258-020-00606-4
    DOI: 10.1007/s40258-020-00606-4
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    References listed on IDEAS

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    1. Garber, Alan M. & Phelps, Charles E., 1997. "Economic foundations of cost-effectiveness analysis," Journal of Health Economics, Elsevier, vol. 16(1), pages 1-31, February.
    2. Simon Walker & Susan Griffin & Miqdad Asaria & Aki Tsuchiya & Mark Sculpher, 2019. "Striving for a Societal Perspective: A Framework for Economic Evaluations When Costs and Effects Fall on Multiple Sectors and Decision Makers," Applied Health Economics and Health Policy, Springer, vol. 17(5), pages 577-590, October.
    3. Beth Woods & Paul Revill & Mark Sculpher & Karl Claxton, 2015. "Country-level cost-effectiveness thresholds: initial estimates and the need for further research," Working Papers 109cherp, Centre for Health Economics, University of York.
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    1. Journal round-up: Applied Health Economics and Health Policy 19(2)
      by karanshahk2 in The Academic Health Economists' Blog on 2021-04-19 06:00:07

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