IDEAS home Printed from
   My bibliography  Save this article

An Economic Theory Of The Fourth Hurdle


  • WH Rogowski


Third party payers' decision processes for financing health technologies (‘fourth hurdle’ processes) are subject to intensive descriptive empirical investigation. This paper addresses the need for a theoretical foundation of this research and develops a theoretical framework for analysing fourth hurdle processes from an economics perspective. On the basis of a decision‐analytic framework and the theory of agents, fourth hurdle processes are described as sets of institutions to maximize the value derived from finite healthcare resources. Benefits are assumed to arise from the value of better information about and better implementation of the most cost‐effective choice. Implementation is improved by decreased information asymmetries and better alignment of incentives. This decreases the effects of ex ante and ex post moral hazard on service provision. Potential indicators of high benefit include high costs associated with wrong decisions and large population sizes affected by the decision. The framework may serve as a basis both for further theoretical work, for example, on the appropriate degree of participation as well as further empirical work, for example, on comparative assessments of fourth hurdle processes. It needs to be complemented by frameworks for analysing fourth hurdle institutions developed by other disciplines such as bioethics or law. Copyright © 2012 John Wiley & Sons, Ltd.

Suggested Citation

  • WH Rogowski, 2013. "An Economic Theory Of The Fourth Hurdle," Health Economics, John Wiley & Sons, Ltd., vol. 22(5), pages 600-610, May.
  • Handle: RePEc:wly:hlthec:v:22:y:2013:i:5:p:600-610
    DOI: 10.1002/hec.2830

    Download full text from publisher

    File URL:
    Download Restriction: no

    File URL:
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item

    References listed on IDEAS

    1. Claxton, Karl, 1999. "The irrelevance of inference: a decision-making approach to the stochastic evaluation of health care technologies," Journal of Health Economics, Elsevier, vol. 18(3), pages 341-364, June.
    2. Briggs, Andrew & Sculpher, Mark & Claxton, Karl, 2006. "Decision Modelling for Health Economic Evaluation," OUP Catalogue, Oxford University Press, number 9780198526629.
    3. Gafni, Amiram & Birch, Stephen, 2006. "Incremental cost-effectiveness ratios (ICERs): The silence of the lambda," Social Science & Medicine, Elsevier, vol. 62(9), pages 2091-2100, May.
    Full references (including those not matched with items on IDEAS)


    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.

    Cited by:

    1. Fischer, Katharina E. & Rogowski, Wolf H. & Leidl, Reiner & Stollenwerk, Björn, 2013. "Transparency vs. closed-door policy: Do process characteristics have an impact on the outcomes of coverage decisions? A statistical analysis," Health Policy, Elsevier, vol. 112(3), pages 187-196.
    2. Katharina Elisabeth Blankart & Tom Stargardt, 2020. "The impact of drug quality ratings from health technology assessments on the adoption of new drugs by physicians in Germany," Health Economics, John Wiley & Sons, Ltd., vol. 29(S1), pages 63-82, October.
    3. Katharina E. Fischer & Björn Stollenwerk & Wolf H. Rogowski, 2013. "Link between Process and Appraisal in Coverage Decisions," Medical Decision Making, , vol. 33(8), pages 1009-1025, November.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Michał Jakubczyk & Bogumił Kamiński, 2017. "Fuzzy approach to decision analysis with multiple criteria and uncertainty in health technology assessment," Annals of Operations Research, Springer, vol. 251(1), pages 301-324, April.
    2. Qi Cao & Erik Buskens & Hans L. Hillege & Tiny Jaarsma & Maarten Postma & Douwe Postmus, 2019. "Stratified treatment recommendation or one-size-fits-all? A health economic insight based on graphical exploration," The European Journal of Health Economics, Springer;Deutsche Gesellschaft für Gesundheitsökonomie (DGGÖ), vol. 20(3), pages 475-482, April.
    3. McKenna, Claire & Chalabi, Zaid & Epstein, David & Claxton, Karl, 2010. "Budgetary policies and available actions: A generalisation of decision rules for allocation and research decisions," Journal of Health Economics, Elsevier, vol. 29(1), pages 170-181, January.
    4. Claire McKenna & Karl Claxton, 2011. "Addressing Adoption and Research Design Decisions Simultaneously," Medical Decision Making, , vol. 31(6), pages 853-865, November.
    5. Kasper M. Johannesen & Karl Claxton & Mark J. Sculpher & Allan J. Wailoo, 2018. "How to design the cost‐effectiveness appraisal process of new healthcare technologies to maximise population health: A conceptual framework," Health Economics, John Wiley & Sons, Ltd., vol. 27(2), pages 41-54, February.
    6. Andrea Gabrio & Michael J. Daniels & Gianluca Baio, 2020. "A Bayesian parametric approach to handle missing longitudinal outcome data in trial‐based health economic evaluations," Journal of the Royal Statistical Society Series A, Royal Statistical Society, vol. 183(2), pages 607-629, February.
    7. Gandjour, Afschin & Chernyak, Nadja, 2011. "A new prize system for drug innovation," Health Policy, Elsevier, vol. 102(2), pages 170-177.
    8. Zoe Philips & Karl Claxton & Stephen Palmer, 2008. "The Half-Life of Truth: What Are Appropriate Time Horizons for Research Decisions?," Medical Decision Making, , vol. 28(3), pages 287-299, May.
    9. Chiranjeev Sanyal & Don Husereau, 2020. "Systematic Review of Economic Evaluations of Services Provided by Community Pharmacists," Applied Health Economics and Health Policy, Springer, vol. 18(3), pages 375-392, June.
    10. Mark Oppe & Daniela Ortín-Sulbarán & Carlos Vila Silván & Anabel Estévez-Carrillo & Juan M. Ramos-Goñi, 2021. "Cost-effectiveness of adding Sativex® spray to spasticity care in Belgium: using bootstrapping instead of Monte Carlo simulation for probabilistic sensitivity analyses," The European Journal of Health Economics, Springer;Deutsche Gesellschaft für Gesundheitsökonomie (DGGÖ), vol. 22(5), pages 711-721, July.
    11. Risha Gidwani & Louise B. Russell, 2020. "Estimating Transition Probabilities from Published Evidence: A Tutorial for Decision Modelers," PharmacoEconomics, Springer, vol. 38(11), pages 1153-1164, November.
    12. Eldon Spackman & Stewart Richmond & Mark Sculpher & Martin Bland & Stephen Brealey & Rhian Gabe & Ann Hopton & Ada Keding & Harriet Lansdown & Sara Perren & David Torgerson & Ian Watt & Hugh MacPherso, 2014. "Cost-Effectiveness Analysis of Acupuncture, Counselling and Usual Care in Treating Patients with Depression: The Results of the ACUDep Trial," PLOS ONE, Public Library of Science, vol. 9(11), pages 1-12, November.
    13. Round, Jeff, 2012. "Is a QALY still a QALY at the end of life?," Journal of Health Economics, Elsevier, vol. 31(3), pages 521-527.
    14. Joseph F. Levy & Marjorie A. Rosenberg, 2019. "A Latent Class Approach to Modeling Trajectories of Health Care Cost in Pediatric Cystic Fibrosis," Medical Decision Making, , vol. 39(5), pages 593-604, July.
    15. Thomas Reinhold & Claudia Witt & Susanne Jena & Benno Brinkhaus & Stefan Willich, 2008. "Quality of life and cost-effectiveness of acupuncture treatment in patients with osteoarthritis pain," The European Journal of Health Economics, Springer;Deutsche Gesellschaft für Gesundheitsökonomie (DGGÖ), vol. 9(3), pages 209-219, August.
    16. Jorge Luis Garcia & James J. Heckman, 2020. "Early Childhood Education and Life-cycle Health," Working Papers 2020-011, Human Capital and Economic Opportunity Working Group.
    17. Stephen Morris & Kurinchi S Gurusamy & Jessica Sheringham & Brian R Davidson, 2015. "Cost-Effectiveness Analysis of Endoscopic Ultrasound versus Magnetic Resonance Cholangiopancreatography in Patients with Suspected Common Bile Duct Stones," PLOS ONE, Public Library of Science, vol. 10(3), pages 1-12, March.
    18. Tushar Srivastava & Nicholas R. Latimer & Paul Tappenden, 2021. "Estimation of Transition Probabilities for State-Transition Models: A Review of NICE Appraisals," PharmacoEconomics, Springer, vol. 39(8), pages 869-878, August.
    19. Tom L. Drake & Yoel Lubell & Shwe Sin Kyaw & Angela Devine & Myat Phone Kyaw & Nicholas P. J. Day & Frank M. Smithuis & Lisa J. White, 2017. "Geographic Resource Allocation Based on Cost Effectiveness: An Application to Malaria Policy," Applied Health Economics and Health Policy, Springer, vol. 15(3), pages 299-306, June.
    20. Manuel Gomes & Robert Aldridge & Peter Wylie & James Bell & Owen Epstein, 2013. "Cost-Effectiveness Analysis of 3-D Computerized Tomography Colonography Versus Optical Colonoscopy for Imaging Symptomatic Gastroenterology Patients," Applied Health Economics and Health Policy, Springer, vol. 11(2), pages 107-117, April.

    More about this item


    Access and download statistics


    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:wly:hlthec:v:22:y:2013:i:5:p:600-610. 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: . General contact details of provider: .

    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 CitEc recognized a bibliographic reference but did not link an item in RePEc 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 RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Wiley Content Delivery (email available below). General contact details of provider: .

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

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.