Cost Per Qaly Nice
Aug 25, 2007 It means that NICE has recommended too many new technologies. It also means that when primary care trusts implement NICE's guidance, resources may be diverted from other healthcare services that are better value for money. By setting the hurdle too low (the cost per QALY threshold too high), NICE might be reducing the efficiency of the NHS. There is no consensus, but it is generally accepted in the community of health economists that a health intervention would be cost-effective if it costs less than $50,000 per QALY. This figure of $50,000 per QALY has been around for decades, so it may change soon in the future. This valuation lies at the heart of the work performed by NICE—which, since its inception in 1999, has adopted a cost effectiveness threshold range of £20 000 (€29 500; $40 000) to £30 000 per quality adjusted life year (QALY) gained.
The incremental cost-effectiveness ratio (ICER) is a statistic used in cost-effectiveness analysis to summarise the cost-effectiveness of a health care intervention. It is defined by the difference in cost between two possible interventions, divided by the difference in their effect. It represents the average incremental cost associated with 1 additional unit of the measure of effect. The ICER can be estimated as:
,
where and are the cost and effect in the intervention group and where and are the cost and effect in the control care group.[1] Costs are usually described in monetary units, while effects can be measured in terms of health status or another outcome of interest. A common application of the ICER is in cost-utility analysis, in which case the ICER is synonymous with the cost per quality-adjusted life year (QALY) gained.
Use as a decision rule[edit]
The ICER can be used as a decision rule in resource allocation. If a decision-maker is able to establish a willingness-to-pay value for the outcome of interest, it is possible to adopt this value as a threshold. If for a given intervention the ICER is above this threshold it will be deemed too expensive and thus should not be funded, whereas if the ICER lies below the threshold the intervention can be judged cost-effective. This approach has to some extent been adopted in relation to QALYs; for example, the National Institute for Health and Care Excellence (NICE) adopts a nominal cost-per-QALY threshold of £20,000 to £30,000.[2] As such, the ICER facilitates comparison of interventions across various disease states and treatments. In 2009, NICE set the nominal cost-per-QALY threshold at £50,000 for end-of-life care because dying patients typically benefit from any treatment for a matter of months, making the treatment's QALYs small.[3] In 2016, NICE set the cost-per-QALY threshold at £100,000 for treatments for rare conditions because, otherwise, drugs for a small number of patients would not be profitable.[3] The use of ICERs therefore provides an opportunity to help contain health care costs while minimizing adverse health consequences.[4] Treatments for patients who are near death offer few QALYs simply because the typical patient has only months left to benefit from treatment. They also provide to policy makers information on where resources should be allocated when they are limited.[5] As health care costs have continued to rise, many new clinical trials are attempting to integrate ICER into results to provide more evidence of potential benefit.[6]
Controversies[edit]
Many people feel that basing health care interventions on cost-effectiveness is a type of health care rationing and have expressed concern that using ICER will limit the amount or types of treatments and interventions available to patients.[5] Currently, the National Institute for Health and Care Excellence (NICE) of England's National Health Service (NHS) uses cost-effectiveness studies to determine if new treatments or therapies at the prices proposed by manufacturers provide better value relative to the treatment that is currently in use. With the number of cost-effectiveness studies rising, it is possible for a cost-effectiveness ratio threshold to be established in other countries for the acceptance of reimbursement or formulary listing at a given price.
Cost Per Qaly Nice For Women
Research by York University identified that the cost per quality adjusted life year for changes in existing NHS expenditure in 2008 was £12,936 leading to concerns new treatments approved by NICE at £30,000 per Quality adjusted life year are less cost-effective than spend on existing treatments. This would mean that diverting NHS spend to new treatments would forgo more than 2 quality adjusted life years for every year gained from the new treatment. [Methods for the estimation of the NICE cost effectiveness threshold. Claxton K, Martin S, Soares M, Rice N, Spackman E, Hinde S, Devlin N, Smith PC, Sculpher M. Health Technology Assessment 2015;19(14):doi10.3310/hta19140]
The concern that ICER may lead to rationing has affected policy makers in the United States. The Patient Protection and Affordable Care Act of 2010 provided for the creation of the independent Patient-Centered Outcomes Research Institute (PCORI). The Senate Finance Committee in writing PPACA forbade PCORI from using 'dollars-per-quality adjusted life year (or similar measure that discounts the value of a life because of an individual's disability) as a threshold to establish what type of health care is cost effective or recommended'.[7]
References[edit]
- ^What is the incremental cost-effectiveness ratio (ICER)? GaBI Online. [1]. Accessed 20 March 2012.
- ^Appleby, John; Devlin, Nancy; Parkin, David (2007). 'NICE's cost effectiveness threshold'. BMJ. 335 (7616): 358–9. doi:10.1136/bmj.39308.560069.BE. PMC1952475. PMID17717337.
- ^ ab'Three NICE thresholds for cost-effectiveness: does that make sense? - Pharmaphorum'. Pharmaphorum. 2016-11-25. Retrieved 2017-01-10.
- ^Orszag PR, Ellis P (2007). 'Addressing rising health care costs—A view from the Congressional Budget Office'. N Engl J Med. 357 (18): 1885–1887. doi:10.1056/NEJMp078190. PMID17978287.
- ^ abCost-effective Medical Treatment: Putting an Updated Dollar Value on Human Life. Knowledge@Wharton, 30 April 2008. [2]. Accessed 20 March 2012.
- ^Ramsey S, Willke R, Briggs A, Brown R, Buxton M, Chawla A, Cook J, Glick H, Liljas B, Petitti D, Reed S (2005). 'Good research practices for cost-effectiveness analysis alongside clinical trials: The ISPOR RCT-CEA task force report'(PDF). Value in Health. 8 (5): 521–533. doi:10.1111/j.1524-4733.2005.00045.x. PMID16176491.
- ^Wilkerson J. PCORI head vows not to do cost-effectiveness studies, but notes gray areas. InsideHealthPolicy.com, 28 September 2011. Accessed 20 March 2012.
Cost-Effectivness Analysis
How much do you think a healthy year of your life cost? It is a ridiculous question, isn’t it?Yes, I know it is hard to put a price on your life. Furthermore, I would answer differently if I were a 23-year-old, full of life and have an average 60 years more to live or if I were a 78 year old with heart conditions.
Economists have to find some way to put values on health since they have to compare one health intervention to another. The objective is to evaluate the costs and consequences (benefits, potential complications and safety issues) of a health intervention, so they can find ways to maximize the benefits, given limited health care resources. So, in order to put all health outcomes, from prolongation of life, pain reduction to prevention of diseases into the same frame of reference, health economists invent the concept of a quality-adjusted life-year (QALY) to facilitate cost-effectiveness analysis.
What is Quality-Adjusted Life-Year (QALY) ?
QALYs were developed in the 1960s to facilitate cost-effectiveness analysis (CEA). One of the earliest works using QALY was Klarman and colleagues, who analyzed chronic renal disease in 1968.
Quality-adjusted life-year represents the morbidity of diseases by a scale of 0 to 1.0, representing the extremes of death and full health. For instance, if you have diabetes and foot amputation due to diabetic complications, your quality of life will be reduced by 35%. In other words, your quality-adjusted life-year would be only 0.65.
You may say your quality of life would be reduced by 50% not 35%. Health economists account for the variations in individual’s judgment of how a certain condition affects his or her quality of life by conducting surveys.
In earlier days of quality-adjusted life-year, in each cost-effectiveness analysis, health economists must collect data on quality-adjusted life-year on the disease(s) that they investigated. Sometimes, they need to use the so-called “expert opinions' if there is no data available. To avoid this rather arbitrary method and inconsistencies between different cost-effectiveness studies, the Panel on Cost-Effectiveness in Health Medicine (PCEHM) (organized by the US Public Health Service) recommended establishing a national catalogue of preference weights that could be used by cost-effectiveness researchers. The catalogue will be built from a sample that represents the U.S. population.
Cost Per Qaly Nice Meaning
QALY Using the EQ-5D Index System
In 2006, the building of such catalogue was completed. You can now search for your favorite value of QALY at https://www.ohsu.edu/epc/mdm/calculator.htm using the EQ-5D Index Score Calculator. There are other health status measures used to create QALYs include the Health Utilities Index (HUI) the Quality of Well-Being Scale (QWB) and the Health and Activity Limitation Index (HALex). But it seems that EQ-5D is the one most frequently used right now.
The EQ-5D index is a 5-item descriptive system. It quantifies 5 dimensions of health status: morbidity, pain and discomfort, anxiety/depression, self-care and usual activities. Each dimension is accessed at 3 levels, namely, no problem, some problems and extreme problems. The EQ-5D is adjusted for other factors including age, gender, race, ethnicity and income.
So if you had colon cancer and you are a 65 year old white female, your EQ-5D index for quality-adjusted life-year is 0.93. That is if you live 1 year with colon cancer, it is only worth 93% of a year with full health and no diseases. If you have two conditions at the same time, let’s say, colon cancer and neurotic disorder, your EQ-5D index is 0.79.
Cost Per Qaly Nice Quotes
Now, you know what a QALY is,how much do you think a quality-adjusted life-year costs? There is no consensus, but it is generally accepted in the community of health economists that a health intervention would be cost-effective if it costs less than $50,000 per QALY. This figure of $50,000 per QALY has been around for decades, so it may change soon in the future.
Sources
Preference–Based EQ–5D Index Scores for Chronic Conditions in the United States PW Sullivan, V Ghushchyan – Medical Decision Making, 2006 – mdm.sagepub.com
Klarman HE, Francis JO, Rosenthal GD. 1968. Cost-effectiveness analysis applied to the treatment of chronic renal disease. Med. Care 6:48–54
HALY S AND QALY S AND DALY S, OHMY: Similarities and Differences in Summary Measures of Population, MR Gold, D Stevenson, DG Fryback – Annual Reviews in Public Health, 2002 – Annual Reviews
This post is part of the series: Health economics – The Primer
- Cost of Health Care