Funding the Impossible: Beyond NICE A health economist

1
Funding the Impossible Beyond NICEA health
economists perspectiveUKMF Autumn Education
Day, 23 Oct 2008

• Joanne Lord
• Reader in Health Economics
• Health Economics Research Group
• Brunel University
• Joanne.Lord_at_brunel.ac.uk

2
Why consider cost-effectiveness?

• If the NHS spends more on one thing, it must do
  less of something else
• Could we do more good by using the resources in
  other ways?
• It would be unethical for NICE to ignore effects
  of guidance for other patients

3
What is cost-effectiveness?
... the comparative analysis of alternative
courses of action in terms of both their costs
and consequences.
Current treatment
Costs value of extra resources used (i.e. loss to
other patients)
Consequencesvalue ofhealth gain for this
patient group
New treatment
4
Valuing health outcomes

• Indicators
• e.g. response, symptom free days
• But dont capture importance for patients
• Quality of life
• Many questionnaires e.g. SF36, EQ5D, HAD...
• Disease-specific, person-specific or generic...
• But how to compare changes over time?

5
What is a QALY?

• One year of healthy life for one person
• - People can trade-off survival quality of
  lifee.g. 1 QALY 2 years with 50 QoL for one
  person
• - Each year of healthy life is of equal value
  e.g. 1 QALY 6 months of healthy life for two
  people

6
Trading off benefits, harms and costs
More expensive
Costs
but some cost savings
More effective
but some side effects
Current treatment
QALYs
New treatment
7
Measuring cost-effectiveness
Costs
QALYs
8
How much can we/ should we pay?
Costs
The threshold should reflect what is
displacedelsewhere in NHS
QALYs
9
How does NICE make its decisions?Guide to the
methods of technology appraisal, 2008

• Committee makes judgement on most plausible
  ICER
• Below 20K per QALY technology will normally be
  approved
• 20 - 30K judgements will take account of
• Degree of uncertainty
• If change in HRQL is adequately captured in the
  QALY
• Innovation that adds demonstrable and distinctive
  benefits not captured in the QALY
• Above 30K need an increasingly stronger case

10
How does NICE make its decisions?Social Value
Judgements, 2008

• Should not recommend if no/insufficient evidence
• Must take account of cost-effectiveness
• Also consider other factors, including fair
  distribution
• Explain reasons for approval/non-approval
• Individual choice does not override
  cost-effectiveness
• NICE does not adopt an additional rule of
  rescue
• Can recommend for subgroups (e.g. by age or sex)
  but only if clear evidence of increased
  effectiveness or other reasons relating to
  fairness or legal requirement

11
How to get NICE approval?What not to do

• Omit quality of life from calculations
• Ignore adverse effects
• Pick inappropriate comparators
• Cherry pick data
• Argue that its a rare disease so the cost impact
  will be small

12
How to get NICE approval?What to do

• Calculate plausible ICER following NICE reference
  case and methodological guidance
• If gt 20,000 consider other factors set out in
  methods guide SVJ document can these be
  argued plausibly backed up with evidence?
• If not, consider other ways to reduce ICER
• Placing of treatment in care pathway
• Better selection of patients
• Continuation/stopping rules
• Reduce cost