Is NICE's Cost Effectiveness Threshold Too High? UK

Main Category: Public Health
Also Included In: Regulatory Affairs / Drug Approvals
Article Date: 30 Aug 2007 - 2:00 PDT

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Is NICE's cost effectiveness threshold too generous, ask experts in this week's BMJ?

The National Institute for Health and Clinical Excellence (NICE) is an independent body that decides which drugs should be available on the NHS in England and Wales. Since its inception in 1999, NICE has adopted a cost effectiveness threshold range of £20,000 to £30,000 per quality adjusted life year (QALY) gained. A QALY is a combined measure of quantity and quality of life.

But the uncomfortable truth is that NICE's threshold has no basis in either theory or evidence, argue John Appleby, Chief Economist at the King's Fund, and colleagues Nancy Devlin and David Parkin at City University in London.

Cost effectiveness is emerging as a key factor in an ongoing House of Commons Select Committee inquiry into NICE, which has received evidence that the threshold may be too generous, they explain. If this suggestion is correct, the implications are profound.

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, NICE might reduce the efficiency of the NHS, they warn.

So, what should the threshold be? Evidence suggests a mismatch between NICE's threshold range and that apparent elsewhere in the NHS. For example, the average primary care trusts spends £12,000 to gain an extra QALY in circulatory disease and £19,000 in cancer. In contrast, an analysis of NICE's decisions suggests that its threshold is in practice even more generous than NICE admits, being closer to £45,000.

The authors recommend that the NHS be given independence from the Department of Health on the specific matter of setting a cost effectiveness threshold, in the same way that the Bank of England has operational independence from the treasury so that it can set UK interest rates to contain inflation.

NICE conjuring up a threshold and others not using one at all creates neither efficiency nor fairness in the NHS, they conclude.

Editorial: NICE's cost effectiveness threshold
BMJ Volume 335 pp 358-9
http://www.bmj.com

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