IDEAS home Printed from https://ideas.repec.org/
MyIDEAS: Login to save this article or follow this journal

The NICE Cost-Effectiveness Threshold: What it is and What that Means

  • Christopher McCabe

    (Academic Unit of Health Economics and NICE Decision Support Unit, Leeds Institute of Health Sciences, University of Leeds, Leeds, UK)

  • Karl Claxton

    (Centre for Health Economics, Department of Economics and NICE Decision Support Unit, University of York, Heslington, York, UK)

  • Anthony J. Culyer

    (Centre for Health Economics, Department of Economics, University of York, Heslington, York, UK
    Department of Health Policy Management and Evaluation, University of Toronto, Toronto, Ontario, Canada)

The National Institute for Health and Clinical Excellence (NICE) has been using a cost-effectiveness threshold range between Lstg 20_000 and Lstg 30_000 for over 7 years. What the cost-effectiveness threshold represents, what the appropriate level is for NICE to use, and what the other factors are that NICE should consider have all been the subject of much discussion. In this article, we briefly review these questions, provide a critical assessment of NICE's utilization of the incremental cost-effectiveness ratio (ICER) threshold to inform its guidance, and suggest ways in which NICE's utilization of the ICER threshold could be developed to promote the efficient use of health service resources. We conclude that it is feasible and probably desirable to operate an explicit single threshold rather than the current range; the threshold should be seen as a threshold at which `other' criteria beyond the ICER itself are taken into account; interventions with a large budgetary impact may need to be subject to a lower threshold as they are likely to displace more than the marginal activities; reimbursement at the threshold transfers the full value of an innovation to the manufacturer. Positive decisions above the threshold on the grounds of innovation reduce population health; the value of the threshold should be reconsidered regularly to ensure that it captures the impact of changes in efficiency and budget over time; the use of equity weights to sustain a positive recommendation when the ICER is above the threshold requires knowledge of the equity characteristics of those patients who bear the opportunity cost. Given the barriers to obtaining this knowledge and knowledge about the characteristics of typical beneficiaries of UK NHS care, caution is warranted before accepting claims from special pleaders; uncertainty in the evidence base should not be used to justify a positive recommendation when the ICER is above the threshold. The development of a programme of disinvestment guidance would enable NICE and the NHS to be more confident that the net health benefit of the Technology Appraisal Programme is positive. DOI: 10.2165/0019053-200826090-00004

If you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.

File URL: http://pharmacoeconomics.adisonline.com/pt/re/phe/pdfhandler.00019053-200826090-00004.pdf
Download Restriction: Pay per view

File URL: http://pharmacoeconomics.adisonline.com/pt/re/phe/fulltext.00019053-200826090-00004.htm
Download Restriction: Pay per view

As the access to this document is restricted, you may want to look for a different version under "Related research" (further below) or search for a different version of it.

Article provided by Springer Healthcare | Adis in its journal PharmacoEconomics.

Volume (Year): 26 (2008)
Issue (Month): 9 ()
Pages: 733-744

as
in new window

Handle: RePEc:wkh:phecon:v:26:y:2008:i:9:p:733-744
Contact details of provider: Web page: http://pharmacoeconomics.adisonline.com/

References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:

as in new window
  1. Stephen Martin & Nigel Rice & Peter C Smith, 2007. "Further evidence on the link between health care spending and health outcomes in England," Working Papers 032cherp, Centre for Health Economics, University of York.
  2. Birch, Stephen & Gafni, Amiram, 1992. "Cost effectiveness/utility analyses : Do current decision rules lead us to where we want to be?," Journal of Health Economics, Elsevier, vol. 11(3), pages 279-296, October.
Full references (including those not matched with items on IDEAS)

This item is not listed on Wikipedia, on a reading list or among the top items on IDEAS.

When requesting a correction, please mention this item's handle: RePEc:wkh:phecon:v:26:y:2008:i:9:p:733-744. See general information about how to correct material in RePEc.

For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Dave Dustin)

If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

If references are entirely missing, you can add them using this form.

If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.

If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.

Please note that corrections may take a couple of weeks to filter through the various RePEc services.

This information is provided to you by IDEAS at the Research Division of the Federal Reserve Bank of St. Louis using RePEc data.