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Dangerous omissions: the consequences of ignoring decision uncertainty

Research output: Contribution to journalArticle

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Publication details

JournalHealth Economics
DatePublished - Feb 2011
Issue number2
Volume20
Number of pages13
Pages (from-to)212-224
Original languageEnglish

Abstract

Institutions with the responsibility for making adoption (reimbursement) decisions in health care often lack the remit to demand or commission further research: adoption decisions are their only policy instrument. The decision to adopt a technology also influences the prospects of acquiring further evidence because the incentives to conduct research are reduced and the ethical basis of further clinical trials maybe undermined. In these circumstances the decision maker must consider whether the benefits of immediate access to a technology exceeds the value of the evidence which maybe forgone for future patients. We outline how these expected opportunity losses can be established from the perspective of a societal decision maker with and without the remit to commission research, and demonstrate how these considerations change the appropriate decision rules in cost-effectiveness analysis. Importantly, we identify those circumstances in which the approval of a technology that is expected to be cost-effective should be withheld, i.e. when an 'only in research' recommendation should be made. We demonstrate that a sufficient condition for immediate adoption of a technology can provide incentives for manufacturers to reduce the price or provide additional supporting evidence. However, decisions based solely on expected net benefit provide no such incentives, may undermine the evidence base for future clinical practice and reduce expected net health benefits for the patient population.

    Research areas

  • Biomedical Technology, Cost-Benefit Analysis, Decision Making, Humans, Policy Making, Quality-Adjusted Life Years, Technology Assessment, Biomedical, Uncertainty

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