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Rationing in an Era of Multiple Tight Constraints: Is Cost-Utility Analysis Still Fit for Purpose?

Author

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  • Helen Dakin

    (Health Economics Research Centre, Nuffield Department of Population Health)

  • Apostolos Tsiachristas

    (University of Oxford
    University of Oxford)

Abstract

Cost-utility analysis may not be sufficient to support reimbursement decisions when the assessed health intervention requires a large proportion of the healthcare budget or when the monetary healthcare budget is not the only resource constraint. Such cases include joint replacement, coronavirus disease 2019 (COVID-19) interventions and settings where all resources are constrained (e.g. post-COVID-19 or in low/middle-income countries). Using literature on health technology assessment, rationing and reimbursement in healthcare, we identified seven alternative frameworks for simultaneous decisions about (dis)investment and proposed modifications to deal with multiple resource constraints. These frameworks comprised constrained optimisation; cost-effectiveness league table; ‘step-in-the-right-direction’ approach; heuristics based on effective gradients; weighted cost-effectiveness ratios; multicriteria decision analysis (MCDA); and programme budgeting and marginal analysis (PBMA). We used numerical examples to demonstrate how five of these alternative frameworks would operate. The modified frameworks we propose could be used in local commissioning and/or health technology assessment to supplement standard cost-utility analysis for interventions that have large budget impact and/or are subject to additional constraints.

Suggested Citation

  • Helen Dakin & Apostolos Tsiachristas, 2024. "Rationing in an Era of Multiple Tight Constraints: Is Cost-Utility Analysis Still Fit for Purpose?," Applied Health Economics and Health Policy, Springer, vol. 22(3), pages 315-329, May.
    • Handle: RePEc:spr:aphecp:v:22:y:2024:i:3:d:10.1007_s40258-023-00858-w
    DOI: 10.1007/s40258-023-00858-w
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    References listed on IDEAS

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