Since 1999, the National Institute for Health and Clinical Excellence (NICE) Technology Appraisal Programme has been charged with producing guidance for the NHS in England and Wales on the appropriate use of new and existing healthcare programmes. Guidance is based on an assessment of a number of factors, including cost effectiveness. The identification, measurement and valuation of costs are important components of any cost-effectiveness analysis. However, working through these steps raises a number of important methodological questions. For example, how should ‘future’ resource use be estimated, and is there a need to consider all ‘future’ costs? Given that NICE produces national guidance, should national unit cost data be used to value resources or should local variations in negotiated prices be taken into account? This paper was initially prepared as a briefing paper as part of the process of updating NICE’s 2004 Guide to the Methods of Technology Appraisal for a workshop on ‘costs’. It outlines the issues that were raised in the original briefing paper and the subsequent questions that were discussed at the workshop.
This is a preview of subscription content, log in to check access.
Buy single article
Instant access to the full article PDF.
Price includes VAT for USA
National Institute for Health and Clinical Excellence. Guide to the technology appraisals process. London: NICE, 2004 [online]. Available from URL: http://www.nice.org.uk/niceMedia/pdf/TAP_Methods.pdf [Accessed 2007 Jun 4]
Devlin N, Parkin D. Does NICE have a cost-effectiveness threshold and what other factors influence its decisions? A binary choice analysis. Health Econ 2004; 13 (5): 437–452
Dakin HA, Devlin NJ, Odeyemi IAO. ‘Yes’, ‘No’ or ‘Yes, but’? Multinomial modelling of NICE decision-making. Health Pol 2006; 77 (3): 352–367
Morris SN, Devlin N, Parkin D. Economic analysis in health care. Chichester: John Wiley and Sons, Ltd, 2007
Drummond MF, Sculpher MJ, Torrance GW, et al. Methods for the economic evaluation of health care programmes. 3rd ed. Oxford: Oxford University Press, 2005
Claxton K, Sculpher M, Culyer AJ. Mark versus Luke? Appropriate methods for the evaluation of public health interventions [research paper]. York: University of York, Centre for Health Economics, 2007 Nov [online]. Available from URL: http://www.york.ac.uk/inst/che/pdf/rp31.pdf [Accessed 2008 Jul 11]
Brouwer WB, van Exel NJ, Baltussen RM, et al. A dollar is a dollar is a dollar: or is it? Value Health 2006; 9 (5): 341–347
Johnston K, Buxton MJ, Jones DR, et al. Assessing the costs of health care technologies in clinical trials. Health Technol Assess 1999; 3 (6): 1–76
Gold MR, Siegel JE, Russell LB, et al. Cost-effectiveness analysis in health and medicine. New York: Oxford University Press, 1996
Mushlin Al, Fintor L. Is screening for breast cancer cost-effective? Cancer 1992; 69 Suppl. 7: 1957–1962
Johannesson M, Meltzer D, O’Conor RM. Incorporating future costs in medical cost-effectiveness analysis: implications for the cost-effectiveness of the treatment of hypertension. Med Decis Making 1997; 17: 382–389
Moskowitz M. Costs of screening for breast cancer. Radiol Clin North Am 1987; 25: 1031–1037
National Collaborating Centre for Cancer. Prostate cancer: diagnosis and treatment [online]. Available from URL: http://www.nice.org.uk/nicemedia/pdf/CG58FullGuideline.pdf [Accessed 2008 May 1]
Briggs A, Gray A. The distribution of health care costs and their statistical analysis for economic evaluation. J Health Serv Res Policy 1998; 3 (4): 233–345
Briggs A, Gray A. Handling uncertainty in economic evaluations of healthcare interventions. BMJ 1999; 319 (7210): 635–638
Briggs A, Clark T, Wolstenholme J, et al. Missing, presumed at random: cost analysis of incomplete data. Health Econ 2003; 12 (5): 377–392
Drummond M, McGuire A. Economic evaluation in health care: merging theory with practice. New York: Oxford University Press, 2001
Raikou M, McGuire A. Estimating medical care costs under conditions of censoring. J Health Econ 2004; 23 (3): 443–470
Young T. Estimating mean total costs in the presence of censoring: a comparative assessment of methods. Pharmacoeconomics 2005; 23 (12): 1229–1242
Calvert NW, Morgan AB, Catto JW, et al. Effectiveness and cost-effectiveness of prognostic markers in prostate cancer. Br J Cancer 2003; 88 (1): 31–35
UK Department of Health. NHS reference costs 2006–07. London: DH, 2008 Feb [online]. Available from URL: http://www.dh.gov.uk/en/Publicationsandstatistics/Publications/PublicationsPolicyAndGuidance/DH_082571 [Accessed 2008 Mar 1]
Buxton MJ, Acheson R, Caine R, et al. Costs and benefits of the heart transplant programmes at Harefield and Papworth Hospitals [research report no.2]. London: Department of Health and Social Security, 1985
This paper was initially prepared as a briefing paper for NICE as part of the process of updating the Institute’s 2004 Guide to the Methods of Technology Appraisal. The work was funded by NICE through its Decision Support Unit, which is based at the universities of Sheffield, Leicester, York, Leeds and at the London School of Hygiene and Tropical Medicine.
The author has no conflicts of interest that are directly relevant to the content of this article.
About this article
Cite this article
Miners, A. Estimating ‘Costs’ for Cost-Effectiveness Analysis. Pharmacoeconomics 26, 745–751 (2008). https://doi.org/10.2165/00019053-200826090-00005
- Economic Evaluation
- Future Cost
- Briefing Paper
- Relevant Cost
- Estimate Unit Cost