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The Inequality-Adjusted Incremental Cost-Effectiveness Ratio.

Richard Cookson1, Gunjeet Kaur2, Ieva Skarda3

  • 1Center for Health Economics, University of York, Heslington, York, United Kingdom; Saw Swee Hock School of Public Health, National University of Singapore, Singapore.

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Summary
This summary is machine-generated.

This study introduces an inequality-adjusted incremental cost-effectiveness ratio (ICER) to balance health gains with social equity. Adjusting the cost-effectiveness threshold can better reflect health inequality impacts across diseases.

Keywords:
cost-effectiveness analysisequity weightshealth inequalityincremental cost-effectiveness ratio (ICER)priority setting

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Area of Science:

  • Health Economics
  • Public Health Policy
  • Social Epidemiology

Background:

  • Standard cost-effectiveness analysis (CEA) often overlooks health equity.
  • Maximizing total health may exacerbate existing health disparities.
  • A need exists to integrate social inequality considerations into health policy decisions.

Purpose of the Study:

  • To develop and validate an adjusted incremental cost-effectiveness ratio (ICER) that accounts for social inequality in health.
  • To assess the impact of this adjusted ICER on cost-effectiveness thresholds.
  • To evaluate how different levels of health inequality aversion influence these adjustments.

Main Methods:

  • Calculated an inequality-adjusted ICER using equity weights from a social welfare function.
  • Defined a health inequality modifier (HIM) to adjust the cost-effectiveness threshold.
  • Applied the method to hypothetical treatments for 1,336 diseases in England, using deprivation group data and varying inequality aversion scenarios.

Main Results:

  • Under medium inequality aversion, the HIM ranged from 0.96 to 1.18, altering thresholds by -4% to +18%.
  • Thresholds were reduced by ≥10% for only 0.15% of diseases but raised by ≥10% for 10.6%.
  • High inequality aversion widened the HIM range to 0.93-1.31, indicating greater potential threshold modification.

Conclusions:

  • The inequality-adjusted ICER effectively modifies cost-effectiveness thresholds to incorporate health inequality.
  • In England, threshold modifications rarely exceed 30%, even with high inequality aversion.
  • Approximately 10% of diseases may see threshold changes exceeding 10% under medium aversion.