The ethics of aggregation in cost-effectiveness analysis or, "on books, bookshelves, and budget impact"

In deciding how to allocate resources, healthcare priority-setters are increasingly paying attention to an intervention's budget impact alongside its cost-effectiveness. Some argue that approaches that use budget impact as a substantive consideration unfairly disadvantage individuals who belong to large patient groups. Others reject such claims of "numerical discrimination" on the grounds that consideration of the full budget impact of an intervention's adoption is necessary to properly estimate opportunity cost. This paper summarizes this debate and advances a new argument against modifying the cost-effectiveness threshold used for decision-making based on a technology's anticipated budget impact. In making this argument, the paper sets out how the apparent link between budget impact and opportunity cost is largely broken if the effects of a technology's adoption are disaggregated, while highlighting that the theoretical aggregation of effects during cost-effectiveness analysis likely only poorly reflects the operation of the health system in practice. As such, it identifies a need for healthcare priority-setters to be cognizant of the ethical implications associated with aggregating the effects of a technology's adoption for the purpose of decision-making. Throughout the paper, these arguments are illustrated with reference to a "bookshelf" analogy borrowed from previous work.

Incorporating Portfolio Uncertainty in Decision Rules for Healthcare Resource Allocation

Cost-effectiveness analysis is widely adopted as a means to inform policy and decision makers in setting priorities for healthcare resource allocation. In resource-constrained settings, decision makers are confronted with healthcare resource reallocation decisions, e.g., moving funds from one or more existing healthcare programs to fund new healthcare programs. The decision-making plane (DMP) has been developed as a means to graphically present the results of reallocating available healthcare resources when healthcare program costs and effects are uncertain. Mapping a value function over the DMP allows the analyst to value all possible combinations of net costs and net effects that may result from reallocating available healthcare resources under conditions of uncertainty. In this paper, we extend this approach to include a change in portfolio risk, stemming from a change in the portfolios of funded healthcare programs, as an additional source of uncertainty, and demonstrate how this can be incorporated into the value function over net costs and net effects for a risk-averse decision maker. The methodology presented in this paper is of particular interest to decision makers who are risk averse, as it will help to better incorporate their preferences in the process of deciding how to best allocate scarce healthcare resources.

A Systematic Review of WTA-WTP Disparity for Dental Interventions and Implications for Cost-Effectiveness Analysis

Cost-effectiveness analysis is widely adopted as an analytical framework to evaluate whether health care interventions represent value for money, and its use in dentistry is increasing. Traditionally, in cost-effectiveness analysis, one assumes that the decision maker's maximum willingness to pay (WTP) for health gain is equivalent to his minimum willingness to accept (WTA) monetary compensation for health loss. It has been documented in the literature that losses are weighted higher than equivalent gains, i.e., that WTA exceeds WTP for the same health condition, resulting in a WTA/WTP ratio greater than 1. There is a knowledge gap of published WTA/WTP ratios for dental interventions in the literature. We therefore conducted a (i) systematic review of published WTA-WTP estimates in dentistry (MEDLINE, Web of Science, Cochrane Library, London, UK) and (ii) a patient-level analysis of WTA/WTP ratios of included studies, and (iii) we demonstrate the impact of a WTA-WTP disparity on cost-effectiveness analysis. Out of 55 eligible studies, two studies were included in our review. The WTA/WTP ratio ranged from 2.58 for discontinuing water fluoridation to 5.12 for mandibular implant overdentures, indicating a higher disparity for implant rehabilitations than for dental public health interventions. A WTA-WTP disparity inflates the cost-effectiveness of dental interventions when there is a substantial risk of both lower costs and health outcomes. We therefore recommend that in these cases the results of cost-effectiveness analyses are reported using different WTA/WTP ratios in a sensitivity analysis.

Caveat emptor NICE: biased use of cost-effectiveness is inefficient and inequitable

Concern with the threshold applied in cost-effectiveness analyses by bodies such as NICE distracts attention from their biased use of the principle. The bias results from the prior requirement that an intervention be effective (usually 'clinically effective') before its cost-effectiveness is considered. The underlying justification for the use of cost-effectiveness as a criterion, whatever the threshold adopted, is that decisions in a resource-constrained system have opportunity costs. Their existence rules out any restriction to those interventions that are 'incrementally cost-effective' at a chosen threshold and requires acceptance of those that are 'decrementally cost-effective' at the same threshold. Interventions that fall under the linear ICER line in the South-West quadrant of the cost-effectiveness plane are cost-effective because they create net health benefits, as do those in the North-East quadrant. If there is objection to the fact that they are cost-effective by reducing effectiveness as well as costs, it is possible to reject them, but only on policy grounds other than their failure to be cost-effective. Having established this, the paper considers and seeks to counter the arguments based on these other grounds. Most notably these include those proposing a different threshold in the South-West quadrant from the North-East one, i.e. propose a 'kinked ICER'. Another undesirable consequence of the biased use of cost-effectiveness is the failure to stimulate innovations that would increase overall health gain by being less effective in the condition concerned, but generate more benefits elsewhere. NICE can only reward innovations that cost more.

Finding legitimacy for the role of budget impact in drug reimbursement decisions

OBJECTIVES

Research has shown that effectiveness, cost-effectiveness, and severity of illness each play a role in drug reimbursement decisions. However, the role of budget impact in such decisions is less obvious. Policy makers almost always demand a budget impact estimate yet seem reluctant to formally include budget impact as a rationing criterion. Health economists even reject budget impact as a legitimate criterion. For these reasons, it is important to examine its use in rationing decisions, and rationales underlying its use.

METHODS

We trace several rationales supporting the use of budget impact through a literature review, supplemented by semistructured interviews with eleven key stakeholders involved in drug reimbursement decisions in the Netherlands.

RESULTS

Budget impact arguments are used in certain instances, although policy makers appear uncomfortable with its use because well described rationales still are lacking. In addition, we identify the following rationales to support budget impact as a rationing criterion: opportunity costs, loss aversion, uncertainty and equal opportunity.

CONCLUSIONS

Budget impact plays a role in drug reimbursement decisions and has rationales to support its use. However, policy makers do not easily admit that they consider budget impact and are even reluctant to explicitly use budget impact as a formal criterion. A debate would strengthen the theoretical foundation of budget impact as a legitimate criterion in the context of drug reimbursement decisions. Such discussion of budget impact's role will also enhance policy-makers' accountability.

Market and patient access to new oncology products in Europe: a current, multidisciplinary perspective

To air challenging issues related to patient and market access to new anticancer agents, the Biotherapy Development Association--an international group focused on developing targeted cancer therapies using biological agents--convened a meeting on 29 November 2007 in Brussels, Belgium. The meeting provided a forum for representatives of pharmaceutical companies and academia to interact with European regulatory and postregulatory agencies. The goal was to increase all parties' understanding of their counterparts' roles in the development, licensure, and appraisal of new agents for cancer treatment, events guided by an understanding that cancer patients should have rapid and equitable access to life-prolonging treatments. Among the outcomes of the meeting were a greater understanding of the barriers facing drug developers in an evolving postregulatory world, clarity about what regulatory and postregulatory bodies expect to see in dossiers of new anticancer agents as they contemplate licensure and reimbursement, and several sets of recommendations to optimize patients' access to innovative, safe, effective, and fairly priced cancer treatments.