A View from the Bridge: Health Economic Evaluation — A Value‐Based Framework?

Abstract

In the 25 years since Health Economics first came to press, health economic evaluation has come of age. The first issue of Health Economics was published in 1992, the same year that the Pharmaceutical Benefits Advisory Committee in Australia launched its first formal submission process for manufacturers to gain listing on its pharmaceutical benefit schedule, which included the requirement to present an economic assessment of the drug's cost-effectiveness. Within the next few years, Canada had followed with its Common Drug Review and the UK introduced the National Institute for Clinical Excellence (NICE) in 1999. These early attempts to implement formal health technology assessment (HTA) processes into national decision-making have all stood the test of time, and many other countries have followed suit, with processes in Germany, Sweden and the Netherlands all employing a formal assessment of value (O'Donnell et al., 2009). The proliferation of national processes is gaining traction in other parts of the world too, with many countries in South America and Asia developing their own guidelines and submission processes. Even Japan has entered the fray with a new HTA programme that began on a trial basis from April of this year.Although the US was an early pioneer of HTA with its Office of Technology Assessment (OTA), the US remains one part of the world where there is relatively little formal use of health economic evaluation. This gap can in part be explained by the disparate group of payers that makes up the US system. Without a 'single-payer' model, the impetus for a national programme of HTA is lacking. Indeed, the OTA was disbanded in the US in 1995 just as other HTA systems were finding their mark (O'Donnell et al., 2009). Even where national bodies still exist, their ability to consider cost-effectiveness information is restricted. For example, the US Preventive Services Task Force (USPSTF) is not allowed to consider cost when issuing its guidance -a bizarre situation that leads investigators to use healthcare resource use as a proxy for cost when examining efficiency in screening programmes. The recent USPSTF guidance on colorectal cancer screening used 'colonoscopy' procedures as its measure of resource cost in order to estimate an efficiency frontier for different screening options (Knudsen et al., 2016). Likewise, in order to get the Affordable Care Act through congress, an amendment required that the Patient-Centered Outcomes Research Institute (PCORI) be prevented from using cost per quality-adjusted life year (QALY) thresholds for prioritizing healthcare deliveryeffectively outlawing cost-effectiveness analysis (Neumann and Weinstein, 2010). PCORI's own frequently asked questions page even emphasizes that proposals that include direct comparisons of the costs of care between two or more alternative interventions will not be considered for funding.Although the processes in Australia, Canada and the UK have largely survived unchanged over the past 15-20 years, there have been some challenges. In particul...

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