Cost-Effectiveness Thresholds: the Past, the Present and the Future

Volume 36, Issue 5, May 2018

Leading Article
Cost-Effectiveness Thresholds: the Past, the Present and the Future
Praveen Thokala, Jessica Ochalek, Ashley A. Leech, Thaison Tong
Cost-effectiveness (CE) thresholds are being discussed more frequently and there have been many new developments in this area; however, there is a lack of understanding about what thresholds mean and their implications. This paper provides an overview of the CE threshold literature. First, the meaning of a CE threshold and the key assumptions involved (perfect divisibility, marginal increments in budget, etc.) are highlighted using a hypothetical example, and the use of historic/heuristic estimates of the threshold is noted along with their limitations. Recent endeavours to estimate the empirical value of the thresholds, both from the supply side and the demand side, are then presented. The impact on CE thresholds of future directions for the field, such as thresholds across sectors and the incorporation of multiple criteria beyond quality-adjusted life-years as a measure of ‘value’, are highlighted. Finally, a number of common issues and misconceptions associated with CE thresholds are addressed.