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Incremental cost-effectiveness ratio - Wikipedia
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data-mw-ve-target-container> <div class="vector-body-before-content"> <div class="mw-indicators"> </div> <div id="siteSub" class="noprint">From Wikipedia, the free encyclopedia</div> </div> <div id="contentSub"><div id="mw-content-subtitle"></div></div> <div id="mw-content-text" class="mw-body-content"><div class="mw-content-ltr mw-parser-output" lang="en" dir="ltr"><p>The <b>incremental cost-effectiveness ratio</b> (<b>ICER</b>) is a statistic used in <a href="/wiki/Cost-effectiveness_analysis" title="Cost-effectiveness analysis">cost-effectiveness analysis</a> 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: </p> <dl><dd><span class="mwe-math-element"><span class="mwe-math-mathml-inline mwe-math-mathml-a11y" style="display: none;"><math xmlns="http://www.w3.org/1998/Math/MathML" alttext="{\displaystyle ICER={\frac {(C_{1}-C_{0})}{(E_{1}-E_{0})}}}"> <semantics> <mrow class="MJX-TeXAtom-ORD"> <mstyle displaystyle="true" scriptlevel="0"> <mi>I</mi> <mi>C</mi> <mi>E</mi> <mi>R</mi> <mo>=</mo> <mrow class="MJX-TeXAtom-ORD"> <mfrac> <mrow> <mo stretchy="false">(</mo> <msub> <mi>C</mi> <mrow class="MJX-TeXAtom-ORD"> <mn>1</mn> </mrow> </msub> <mo>−<!-- − --></mo> <msub> <mi>C</mi> <mrow class="MJX-TeXAtom-ORD"> <mn>0</mn> </mrow> </msub> <mo stretchy="false">)</mo> </mrow> <mrow> <mo stretchy="false">(</mo> <msub> <mi>E</mi> <mrow class="MJX-TeXAtom-ORD"> <mn>1</mn> </mrow> </msub> <mo>−<!-- − --></mo> <msub> <mi>E</mi> <mrow class="MJX-TeXAtom-ORD"> <mn>0</mn> </mrow> </msub> <mo stretchy="false">)</mo> </mrow> </mfrac> </mrow> </mstyle> </mrow> <annotation encoding="application/x-tex">{\displaystyle ICER={\frac {(C_{1}-C_{0})}{(E_{1}-E_{0})}}}</annotation> </semantics> </math></span><img src="https://wikimedia.org/api/rest_v1/media/math/render/svg/b042b2af8a46190f5506176e193d28e2f86a1c99" class="mwe-math-fallback-image-inline mw-invert skin-invert" aria-hidden="true" style="vertical-align: -2.671ex; width:20.601ex; height:6.509ex;" alt="{\displaystyle ICER={\frac {(C_{1}-C_{0})}{(E_{1}-E_{0})}}}"></span>,</dd></dl> <p>where <span class="mwe-math-element"><span class="mwe-math-mathml-inline mwe-math-mathml-a11y" style="display: none;"><math xmlns="http://www.w3.org/1998/Math/MathML" alttext="{\textstyle C_{1}}"> <semantics> <mrow class="MJX-TeXAtom-ORD"> <mstyle displaystyle="false" scriptlevel="0"> <msub> <mi>C</mi> <mrow class="MJX-TeXAtom-ORD"> <mn>1</mn> </mrow> </msub> </mstyle> </mrow> <annotation encoding="application/x-tex">{\textstyle C_{1}}</annotation> </semantics> </math></span><img src="https://wikimedia.org/api/rest_v1/media/math/render/svg/677a99cc6a1ac23ff88fc13fa384646a09857d76" class="mwe-math-fallback-image-inline mw-invert skin-invert" aria-hidden="true" style="vertical-align: -0.671ex; width:2.716ex; height:2.509ex;" alt="{\textstyle C_{1}}"></span> and <span class="mwe-math-element"><span class="mwe-math-mathml-inline mwe-math-mathml-a11y" style="display: none;"><math xmlns="http://www.w3.org/1998/Math/MathML" alttext="{\displaystyle E_{1}}"> <semantics> <mrow class="MJX-TeXAtom-ORD"> <mstyle displaystyle="true" scriptlevel="0"> <msub> <mi>E</mi> <mrow class="MJX-TeXAtom-ORD"> <mn>1</mn> </mrow> </msub> </mstyle> </mrow> <annotation encoding="application/x-tex">{\displaystyle E_{1}}</annotation> </semantics> </math></span><img src="https://wikimedia.org/api/rest_v1/media/math/render/svg/7ac42446bcd2cbb76ec8fe2895635d328da22e26" class="mwe-math-fallback-image-inline mw-invert skin-invert" aria-hidden="true" style="vertical-align: -0.671ex; width:2.769ex; height:2.509ex;" alt="{\displaystyle E_{1}}"></span> are the cost and effect in the intervention group and where <span class="mwe-math-element"><span class="mwe-math-mathml-inline mwe-math-mathml-a11y" style="display: none;"><math xmlns="http://www.w3.org/1998/Math/MathML" alttext="{\textstyle C_{0}}"> <semantics> <mrow class="MJX-TeXAtom-ORD"> <mstyle displaystyle="false" scriptlevel="0"> <msub> <mi>C</mi> <mrow class="MJX-TeXAtom-ORD"> <mn>0</mn> </mrow> </msub> </mstyle> </mrow> <annotation encoding="application/x-tex">{\textstyle C_{0}}</annotation> </semantics> </math></span><img src="https://wikimedia.org/api/rest_v1/media/math/render/svg/da652d4ed018af92030ab9fd4d0f23415f3653ca" class="mwe-math-fallback-image-inline mw-invert skin-invert" aria-hidden="true" style="vertical-align: -0.671ex; width:2.716ex; height:2.509ex;" alt="{\textstyle C_{0}}"></span> and <span class="mwe-math-element"><span class="mwe-math-mathml-inline mwe-math-mathml-a11y" style="display: none;"><math xmlns="http://www.w3.org/1998/Math/MathML" alttext="{\textstyle E_{0}}"> <semantics> <mrow class="MJX-TeXAtom-ORD"> <mstyle displaystyle="false" scriptlevel="0"> <msub> <mi>E</mi> <mrow class="MJX-TeXAtom-ORD"> <mn>0</mn> </mrow> </msub> </mstyle> </mrow> <annotation encoding="application/x-tex">{\textstyle E_{0}}</annotation> </semantics> </math></span><img src="https://wikimedia.org/api/rest_v1/media/math/render/svg/74e4cdd72c2df19fa65d3cabca0d0b7652fa7944" class="mwe-math-fallback-image-inline mw-invert skin-invert" aria-hidden="true" style="vertical-align: -0.671ex; width:2.769ex; height:2.509ex;" alt="{\textstyle E_{0}}"></span> are the cost and effect in the control care group.<sup id="cite_ref-1" class="reference"><a href="#cite_note-1"><span class="cite-bracket">[</span>1<span class="cite-bracket">]</span></a></sup> 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 <a href="/wiki/Cost%E2%80%93utility_analysis" title="Cost–utility analysis">cost-utility analysis</a>, in which case the ICER is synonymous with the cost per <a href="/wiki/Quality-adjusted_life_years" class="mw-redirect" title="Quality-adjusted life years">quality-adjusted life year</a> (QALY) gained. </p> <div class="mw-heading mw-heading2"><h2 id="Use_as_a_decision_rule">Use as a decision rule</h2><span class="mw-editsection"><span class="mw-editsection-bracket">[</span><a href="/w/index.php?title=Incremental_cost-effectiveness_ratio&action=edit&section=1" title="Edit section: Use as a decision rule"><span>edit</span></a><span class="mw-editsection-bracket">]</span></span></div> <p>The ICER can be used as a decision rule in <a href="/wiki/Resource_allocation" title="Resource allocation">resource allocation</a>. If a decision-maker is able to establish a <a href="/wiki/Willingness-to-pay" class="mw-redirect" title="Willingness-to-pay">willingness-to-pay</a> 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 <a href="/wiki/National_Institute_for_Health_and_Care_Excellence" title="National Institute for Health and Care Excellence">National Institute for Health and Care Excellence</a> (NICE) adopts a nominal cost-per-QALY threshold of £20,000 to £30,000.<sup id="cite_ref-2" class="reference"><a href="#cite_note-2"><span class="cite-bracket">[</span>2<span class="cite-bracket">]</span></a></sup> 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.<sup id="cite_ref-:0_3-0" class="reference"><a href="#cite_note-:0-3"><span class="cite-bracket">[</span>3<span class="cite-bracket">]</span></a></sup> 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.<sup id="cite_ref-:0_3-1" class="reference"><a href="#cite_note-:0-3"><span class="cite-bracket">[</span>3<span class="cite-bracket">]</span></a></sup> The use of ICERs therefore provides an opportunity to help contain <a href="/wiki/Health_care_costs" class="mw-redirect" title="Health care costs">health care costs</a> while minimizing adverse health consequences.<sup id="cite_ref-4" class="reference"><a href="#cite_note-4"><span class="cite-bracket">[</span>4<span class="cite-bracket">]</span></a></sup> 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.<sup id="cite_ref-DollarValue_5-0" class="reference"><a href="#cite_note-DollarValue-5"><span class="cite-bracket">[</span>5<span class="cite-bracket">]</span></a></sup> As health care costs have continued to rise, many new <a href="/wiki/Clinical_trials" class="mw-redirect" title="Clinical trials">clinical trials</a> are attempting to integrate ICER into results to provide more evidence of potential benefit.<sup id="cite_ref-6" class="reference"><a href="#cite_note-6"><span class="cite-bracket">[</span>6<span class="cite-bracket">]</span></a></sup> </p> <div class="mw-heading mw-heading2"><h2 id="Controversies">Controversies</h2><span class="mw-editsection"><span class="mw-editsection-bracket">[</span><a href="/w/index.php?title=Incremental_cost-effectiveness_ratio&action=edit&section=2" title="Edit section: Controversies"><span>edit</span></a><span class="mw-editsection-bracket">]</span></span></div> <p>Many people feel that basing health care interventions on cost-effectiveness is a type of <a href="/wiki/Health_care_rationing" title="Health care rationing">health care rationing</a> and have expressed concern that using ICER will limit the amount or types of treatments and interventions available to patients.<sup id="cite_ref-DollarValue_5-1" class="reference"><a href="#cite_note-DollarValue-5"><span class="cite-bracket">[</span>5<span class="cite-bracket">]</span></a></sup> Currently, the <a href="/wiki/National_Institute_for_Health_and_Care_Excellence" title="National Institute for Health and Care Excellence">National Institute for Health and Care Excellence</a> (NICE) of England's <a href="/wiki/National_Health_Service" title="National Health Service">National Health Service</a> (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. </p><p>Research by the University of York 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. <sup id="cite_ref-7" class="reference"><a href="#cite_note-7"><span class="cite-bracket">[</span>7<span class="cite-bracket">]</span></a></sup> </p><p>The concern that ICER may lead to rationing has affected policy makers in the United States. The <a href="/wiki/Patient_Protection_and_Affordable_Care_Act" class="mw-redirect" title="Patient Protection and Affordable Care Act">Patient Protection and Affordable Care Act</a> of 2010 provided for the creation of the independent <a href="/wiki/Patient-Centered_Outcomes_Research_Institute" title="Patient-Centered Outcomes Research Institute">Patient-Centered Outcomes Research Institute</a> (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".<sup id="cite_ref-8" class="reference"><a href="#cite_note-8"><span class="cite-bracket">[</span>8<span class="cite-bracket">]</span></a></sup> </p> <div class="mw-heading mw-heading2"><h2 id="References">References</h2><span class="mw-editsection"><span class="mw-editsection-bracket">[</span><a href="/w/index.php?title=Incremental_cost-effectiveness_ratio&action=edit&section=3" title="Edit section: References"><span>edit</span></a><span class="mw-editsection-bracket">]</span></span></div> <style data-mw-deduplicate="TemplateStyles:r1239543626">.mw-parser-output .reflist{margin-bottom:0.5em;list-style-type:decimal}@media screen{.mw-parser-output .reflist{font-size:90%}}.mw-parser-output .reflist .references{font-size:100%;margin-bottom:0;list-style-type:inherit}.mw-parser-output .reflist-columns-2{column-width:30em}.mw-parser-output .reflist-columns-3{column-width:25em}.mw-parser-output .reflist-columns{margin-top:0.3em}.mw-parser-output .reflist-columns ol{margin-top:0}.mw-parser-output .reflist-columns li{page-break-inside:avoid;break-inside:avoid-column}.mw-parser-output .reflist-upper-alpha{list-style-type:upper-alpha}.mw-parser-output .reflist-upper-roman{list-style-type:upper-roman}.mw-parser-output .reflist-lower-alpha{list-style-type:lower-alpha}.mw-parser-output .reflist-lower-greek{list-style-type:lower-greek}.mw-parser-output .reflist-lower-roman{list-style-type:lower-roman}</style><div class="reflist"> <div class="mw-references-wrap"><ol class="references"> <li id="cite_note-1"><span class="mw-cite-backlink"><b><a href="#cite_ref-1">^</a></b></span> <span class="reference-text">What is the incremental cost-effectiveness ratio (ICER)? GaBI Online. <a rel="nofollow" class="external autonumber" href="http://www.gabionline.net/Generics/General/What-is-the-incremental-cost-effectiveness-ratio-ICER">[1]</a>. Accessed 20 March 2012.</span> </li> <li id="cite_note-2"><span class="mw-cite-backlink"><b><a href="#cite_ref-2">^</a></b></span> <span class="reference-text"><style data-mw-deduplicate="TemplateStyles:r1238218222">.mw-parser-output cite.citation{font-style:inherit;word-wrap:break-word}.mw-parser-output .citation q{quotes:"\"""\"""'""'"}.mw-parser-output .citation:target{background-color:rgba(0,127,255,0.133)}.mw-parser-output .id-lock-free.id-lock-free a{background:url("//upload.wikimedia.org/wikipedia/commons/6/65/Lock-green.svg")right 0.1em center/9px no-repeat}.mw-parser-output .id-lock-limited.id-lock-limited a,.mw-parser-output .id-lock-registration.id-lock-registration a{background:url("//upload.wikimedia.org/wikipedia/commons/d/d6/Lock-gray-alt-2.svg")right 0.1em center/9px no-repeat}.mw-parser-output .id-lock-subscription.id-lock-subscription a{background:url("//upload.wikimedia.org/wikipedia/commons/a/aa/Lock-red-alt-2.svg")right 0.1em center/9px no-repeat}.mw-parser-output .cs1-ws-icon a{background:url("//upload.wikimedia.org/wikipedia/commons/4/4c/Wikisource-logo.svg")right 0.1em center/12px no-repeat}body:not(.skin-timeless):not(.skin-minerva) .mw-parser-output .id-lock-free a,body:not(.skin-timeless):not(.skin-minerva) .mw-parser-output .id-lock-limited a,body:not(.skin-timeless):not(.skin-minerva) .mw-parser-output .id-lock-registration a,body:not(.skin-timeless):not(.skin-minerva) .mw-parser-output .id-lock-subscription a,body:not(.skin-timeless):not(.skin-minerva) .mw-parser-output .cs1-ws-icon a{background-size:contain;padding:0 1em 0 0}.mw-parser-output .cs1-code{color:inherit;background:inherit;border:none;padding:inherit}.mw-parser-output .cs1-hidden-error{display:none;color:var(--color-error,#d33)}.mw-parser-output .cs1-visible-error{color:var(--color-error,#d33)}.mw-parser-output .cs1-maint{display:none;color:#085;margin-left:0.3em}.mw-parser-output .cs1-kern-left{padding-left:0.2em}.mw-parser-output .cs1-kern-right{padding-right:0.2em}.mw-parser-output .citation .mw-selflink{font-weight:inherit}@media screen{.mw-parser-output .cs1-format{font-size:95%}html.skin-theme-clientpref-night .mw-parser-output .cs1-maint{color:#18911f}}@media screen and (prefers-color-scheme:dark){html.skin-theme-clientpref-os .mw-parser-output .cs1-maint{color:#18911f}}</style><cite id="CITEREFApplebyDevlinParkin2007" class="citation journal cs1">Appleby, John; Devlin, Nancy; Parkin, David (2007). <a rel="nofollow" class="external text" href="https://www.ncbi.nlm.nih.gov/pmc/articles/PMC1952475">"NICE's cost effectiveness threshold"</a>. <i>BMJ</i>. <b>335</b> (7616): 358–9. <a href="/wiki/Doi_(identifier)" class="mw-redirect" title="Doi (identifier)">doi</a>:<a rel="nofollow" class="external text" href="https://doi.org/10.1136%2Fbmj.39308.560069.BE">10.1136/bmj.39308.560069.BE</a>. <a href="/wiki/PMC_(identifier)" class="mw-redirect" title="PMC (identifier)">PMC</a> <span class="id-lock-free" title="Freely accessible"><a rel="nofollow" class="external text" href="https://www.ncbi.nlm.nih.gov/pmc/articles/PMC1952475">1952475</a></span>. <a href="/wiki/PMID_(identifier)" class="mw-redirect" title="PMID (identifier)">PMID</a> <a rel="nofollow" class="external text" href="https://pubmed.ncbi.nlm.nih.gov/17717337">17717337</a>.</cite><span title="ctx_ver=Z39.88-2004&rft_val_fmt=info%3Aofi%2Ffmt%3Akev%3Amtx%3Ajournal&rft.genre=article&rft.jtitle=BMJ&rft.atitle=NICE%27s+cost+effectiveness+threshold&rft.volume=335&rft.issue=7616&rft.pages=358-9&rft.date=2007&rft_id=https%3A%2F%2Fwww.ncbi.nlm.nih.gov%2Fpmc%2Farticles%2FPMC1952475%23id-name%3DPMC&rft_id=info%3Apmid%2F17717337&rft_id=info%3Adoi%2F10.1136%2Fbmj.39308.560069.BE&rft.aulast=Appleby&rft.aufirst=John&rft.au=Devlin%2C+Nancy&rft.au=Parkin%2C+David&rft_id=https%3A%2F%2Fwww.ncbi.nlm.nih.gov%2Fpmc%2Farticles%2FPMC1952475&rfr_id=info%3Asid%2Fen.wikipedia.org%3AIncremental+cost-effectiveness+ratio" class="Z3988"></span></span> </li> <li id="cite_note-:0-3"><span class="mw-cite-backlink">^ <a href="#cite_ref-:0_3-0"><sup><i><b>a</b></i></sup></a> <a href="#cite_ref-:0_3-1"><sup><i><b>b</b></i></sup></a></span> <span class="reference-text"><link rel="mw-deduplicated-inline-style" href="mw-data:TemplateStyles:r1238218222"><cite class="citation news cs1"><a rel="nofollow" class="external text" href="http://pharmaphorum.com/views-and-analysis/three-nice-thresholds-for-cost-effectiveness-does-that-make-sense/">"Three NICE thresholds for cost-effectiveness: does that make sense? - Pharmaphorum"</a>. <i>Pharmaphorum</i>. 2016-11-25<span class="reference-accessdate">. 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Accessed 20 March 2012.</span> </li> </ol></div></div> <div class="navbox-styles"><style data-mw-deduplicate="TemplateStyles:r1129693374">.mw-parser-output .hlist dl,.mw-parser-output .hlist ol,.mw-parser-output .hlist ul{margin:0;padding:0}.mw-parser-output .hlist dd,.mw-parser-output .hlist dt,.mw-parser-output .hlist li{margin:0;display:inline}.mw-parser-output .hlist.inline,.mw-parser-output .hlist.inline dl,.mw-parser-output .hlist.inline ol,.mw-parser-output .hlist.inline ul,.mw-parser-output .hlist dl dl,.mw-parser-output .hlist dl ol,.mw-parser-output .hlist dl ul,.mw-parser-output .hlist ol dl,.mw-parser-output .hlist ol ol,.mw-parser-output .hlist ol ul,.mw-parser-output .hlist ul dl,.mw-parser-output .hlist ul ol,.mw-parser-output .hlist ul ul{display:inline}.mw-parser-output .hlist .mw-empty-li{display:none}.mw-parser-output .hlist dt::after{content:": "}.mw-parser-output .hlist dd::after,.mw-parser-output .hlist li::after{content:" · ";font-weight:bold}.mw-parser-output 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class="navbox-group" style="width:1%">Concepts of quality</th><td class="navbox-list-with-group navbox-list navbox-odd hlist" style="width:100%;padding:0"><div style="padding:0 0.25em"> <ul><li><a href="/wiki/Evidence-based_medicine" title="Evidence-based medicine">Evidence-based medicine</a></li> <li><a href="/wiki/Medical_consensus" title="Medical consensus">Medical consensus</a></li> <li><a href="/wiki/Medical_guideline" title="Medical guideline">Medical guideline</a></li></ul> </div></td></tr><tr><th scope="row" class="navbox-group" style="width:1%">Health care evaluations</th><td class="navbox-list-with-group navbox-list navbox-even hlist" style="width:100%;padding:0"><div style="padding:0 0.25em"> <ul><li><a href="/wiki/Clinical_audit" title="Clinical audit">Clinical audit</a></li> <li><a href="/wiki/Clinical_peer_review" title="Clinical peer review">Clinical peer review</a></li> <li><a href="/wiki/Independent_medical_review" title="Independent medical review">Independent medical 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href="/wiki/List_of_international_healthcare_accreditation_organizations" title="List of international healthcare accreditation organizations">List of international healthcare accreditation organizations</a></li></ul> </div></td></tr><tr><th scope="row" class="navbox-group" style="width:1%">Costs and benefits</th><td class="navbox-list-with-group navbox-list navbox-even hlist" style="width:100%;padding:0"><div style="padding:0 0.25em"> <ul><li><a class="mw-selflink selflink">Incremental cost-effectiveness ratio</a></li> <li><a href="/wiki/Cost-effectiveness_analysis" title="Cost-effectiveness analysis">Cost-effectiveness analysis</a></li> <li><a href="/wiki/Cost-minimization_analysis" title="Cost-minimization analysis">Cost-minimization analysis</a></li> <li><a href="/wiki/Cost_per_procedure" title="Cost per procedure">Cost per procedure</a></li></ul> </div></td></tr><tr><th scope="row" class="navbox-group" style="width:1%">Tools</th><td class="navbox-list-with-group navbox-list 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