Discounting in economic evaluations

Stepping forward towards optimal decision rules

Hugh Gravelle, Werner Brouwer, Louis Niessen, Maarten Postma, Frans Rutten

Research output: Contribution to journalArticle

Abstract

The National Institute for Clinical Excellence has recently changed its guidelines on discounting costs and effects in economic evaluations. In common with most other regulatory bodies it now requires that health effects should be discounted at the same rate as costs. We show that the guideline leads to sub-optimal decisions because it fails to account for the changing value of health. NICE (and other regulatory bodies) should either use differential discounting or stipulate how the changing value of health should otherwise be dealt with. We also show how binding health service budget constraints should be incorporated in evaluations.

Original languageEnglish (US)
Pages (from-to)307-317
Number of pages11
JournalHealth Economics
Volume16
Issue number3
DOIs
StatePublished - Mar 2007
Externally publishedYes

Fingerprint

Cost-Benefit Analysis
Health
health
evaluation
Guidelines
economics
Costs and Cost Analysis
Budgets
costs
Health Services
health service
budget
Discounting
Decision rules
Economic evaluation
Costs
Health services
Evaluation
Health effects
Budget constraint

Keywords

  • Cost-effectiveness
  • Discounting
  • Value of Health

ASJC Scopus subject areas

  • Nursing(all)
  • Economics and Econometrics
  • Health(social science)
  • Health Professions(all)

Cite this

Discounting in economic evaluations : Stepping forward towards optimal decision rules. / Gravelle, Hugh; Brouwer, Werner; Niessen, Louis; Postma, Maarten; Rutten, Frans.

In: Health Economics, Vol. 16, No. 3, 03.2007, p. 307-317.

Research output: Contribution to journalArticle

Gravelle, Hugh ; Brouwer, Werner ; Niessen, Louis ; Postma, Maarten ; Rutten, Frans. / Discounting in economic evaluations : Stepping forward towards optimal decision rules. In: Health Economics. 2007 ; Vol. 16, No. 3. pp. 307-317.
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