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Discounting and cost-effectiveness in NICE - stepping back to sort out a confusion

Author

Listed:
  • Karl Claxton

    (Member of the NICE Task Group on Economics, UK)

  • Mark Sculpher
  • Anthony Culyer

    (Member of the NICE Methods Working Party, UK)

  • Chris McCabe

    (Member of the NICE Methods Working Party, UK)

  • Andrew Briggs

    (Member of the NICE Task Group on Economics, UK)

  • Ron Akehurst

    (Member of the NICE Methods Working Party, UK)

  • Martin Buxton

    (Member of the NICE Task Group on Economics, UK)

  • John Brazier

    (Member of the NICE Task Group on Economics, UK)

Abstract

Brouwer and colleagues [1] argue that the reasons for specifying an equal discount rate for health outcomes and costs in the recent guidance on methods of technology appraisal issued by the National Institute for Clinical Excellence (NICE) [2] is both opaque and wrong. They argue that a lower rate should apply to health outcomes like QALYs. It is also claimed that the guidance on discounting represents a step backwards, that is both inconsistent with current theoretical insights and will prejudice the outcome of cost-effectiveness studies of preventive interventions. The reasoning behind the use of equal discount rates for costs and health outcomes is indeed not well developed in the published guidance. Nor does it reflect the debate that underpinned the guidance. We therefore welcome the opportunity to explain more completely the rationale in the minds of the principal authors of the current guidance. Copyright © 2006 John Wiley & Sons, Ltd.

Suggested Citation

  • Karl Claxton & Mark Sculpher & Anthony Culyer & Chris McCabe & Andrew Briggs & Ron Akehurst & Martin Buxton & John Brazier, 2006. "Discounting and cost-effectiveness in NICE - stepping back to sort out a confusion," Health Economics, John Wiley & Sons, Ltd., vol. 15(1), pages 1-4.
  • Handle: RePEc:wly:hlthec:v:15:y:2006:i:1:p:1-4 DOI: 10.1002/hec.1081
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    References listed on IDEAS

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    1. Aaron A. Stinnett & John Mullahy, 1998. "Net Health Benefits: A New Framework for the Analysis of Uncertainty in Cost-Effectiveness Analysis," NBER Technical Working Papers 0227, National Bureau of Economic Research, Inc.
    2. 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.
    3. Grossman, Michael, 1972. "On the Concept of Health Capital and the Demand for Health," Journal of Political Economy, University of Chicago Press, vol. 80(2), pages 223-255, March-Apr.
    4. Hugh Gravelle & Dave Smith, 2001. "Discounting for health effects in cost-benefit and cost-effectiveness analysis," Health Economics, John Wiley & Sons, Ltd., vol. 10(7), pages 587-599.
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    Citations

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    Cited by:

    1. Hugh Gravelle & Werner Brouwer & Louis Niessen & Maarten Postma & Frans Rutten, 2007. "Discounting in economic evaluations: stepping forward towards optimal decision rules," Health Economics, John Wiley & Sons, Ltd., vol. 16(3), pages 307-317.
    2. Pieter H. M. van Baal & Talitha L. Feenstra & Johan J. Polder & Rudolf T. Hoogenveen & Werner B. F. Brouwer, 2011. "Economic evaluation and the postponement of health care costs," Health Economics, John Wiley & Sons, Ltd., vol. 20(4), pages 432-445, April.
    3. M. Parouty & H. Le & D. Krooshof & M. Postma, 2014. "Differential Time Preferences for Money and Quality of Life," PharmacoEconomics, Springer, vol. 32(4), pages 411-419, April.
    4. Weatherly, Helen & Drummond, Michael & Claxton, Karl & Cookson, Richard & Ferguson, Brian & Godfrey, Christine & Rice, Nigel & Sculpher, Mark & Sowden, Amanda, 2009. "Methods for assessing the cost-effectiveness of public health interventions: Key challenges and recommendations," Health Policy, Elsevier, vol. 93(2-3), pages 85-92, December.
    5. van der Pol, Marjon & Cairns, John, 2008. "Comparison of two methods of eliciting time preference for future health states," Social Science & Medicine, Elsevier, vol. 67(5), pages 883-889, September.
    6. Christopher McCabe & Richard Edlin & Peter Hall, 2013. "Navigating Time and Uncertainty in Health Technology Appraisal: Would a Map Help?," PharmacoEconomics, Springer, vol. 31(9), pages 731-737, September.
    7. Mike Paulden & Anthony J. Culyer, 2010. "Does Cost-Effectiveness Analysis Discriminate against Patients with Short Life Expectancy?," Working Paper series 41_10, Rimini Centre for Economic Analysis.
    8. Mareike Schad & Jürgen John, 2012. "Towards a social discount rate for the economic evaluation of health technologies in Germany: an exploratory analysis," The European Journal of Health Economics, Springer;Deutsche Gesellschaft für Gesundheitsökonomie (DGGÖ), vol. 13(2), pages 127-144, April.
    9. Kontodimopoulos, Nick & Niakas, Dimitris, 2008. "An estimate of lifelong costs and QALYs in renal replacement therapy based on patients' life expectancy," Health Policy, Elsevier, vol. 86(1), pages 85-96, April.
    10. Mike Paulden & Anthony J Culyer, 2010. "Does cost-effectiveness analysis discriminate against patients with short life expectancy? Matters of logic and matters of context," Working Papers 055cherp, Centre for Health Economics, University of York.
    11. Mike Paulden & James O’Mahony & Anthony Culyer & Christopher McCabe, 2014. "Some Inconsistencies in NICE’s Consideration of Social Values," PharmacoEconomics, Springer, vol. 32(11), pages 1043-1053, November.

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