The impact of different types of NHS expenditure on health: Marginal cost per QALY estimates for England for 2016/17

Stephen Martin; Karl Philip Claxton; James Lomas; Francesco Longo

doi:10.1016/j.healthpol.2023.104800

The impact of different types of NHS expenditure on health: Marginal cost per QALY estimates for England for 2016/17

Stephen Martin, Karl Philip Claxton, James Lomas^*, Francesco Longo

^*Corresponding author for this work

Research output: Contribution to journal › Article › peer-review

Abstract

English data from 2003 to 2012 suggests that it costs the NHS £10,000 to generate an additional quality-adjusted life year (QALY). This estimate relates to all NHS expenditure and no attempt was made to explore possible heterogeneity within this total. Different types of expenditure - such as secondary care, primary care and specialized commissioning - may have different productivities and estimates of these may help policymakers decide where additional investment is most beneficial. We use the two-stage least squares estimator and data for 2016 to explore the mortality response to three types of healthcare expenditure. Three specifications are estimated for each type of expenditure: backward selection and regularized regression are used to identify parsimonious specifications, and a full specification with all covariates is also estimated. The regression results are combined with information about survival and morbidity disease burden to calculate the marginal cost per QALY for each type of expenditure: the most conservative results suggest that this is about £8,000 for locally (CCG) commissioned services, while estimates for specialized commissioning and primary care are more uncertain. When this heterogeneity is taken into account, the estimated marginal cost per QALY for all NHS expenditure increases slightly, from about £6,000 to £7,000. Our results suggest that additional investment is likely to be most productive in primary care and in locally commissioned services.

Original language	English
Article number	104800
Pages (from-to)	104800
Number of pages	9
Journal	Health Policy
Volume	132
Early online date	31 Mar 2023
DOIs	https://doi.org/10.1016/j.healthpol.2023.104800 https://doi.org/10.1016/j.healthpol.2023.104800
Publication status	Published - 1 Jun 2023

Bibliographical note

Access to Document

The impact of different types of NHS expenditure on health: Marginal cost per QALY estimates for England for 2016/17
© 2023 The Authors
Final published version, 407 KBLicence: CC BY

Cite this

@article{ab3d4d3a33c14cbfb0586a8ca66cb478,

title = "The impact of different types of NHS expenditure on health: Marginal cost per QALY estimates for England for 2016/17",

abstract = "English data from 2003 to 2012 suggests that it costs the NHS £10,000 to generate an additional quality-adjusted life year (QALY). This estimate relates to all NHS expenditure and no attempt was made to explore possible heterogeneity within this total. Different types of expenditure - such as secondary care, primary care and specialized commissioning - may have different productivities and estimates of these may help policymakers decide where additional investment is most beneficial. We use the two-stage least squares estimator and data for 2016 to explore the mortality response to three types of healthcare expenditure. Three specifications are estimated for each type of expenditure: backward selection and regularized regression are used to identify parsimonious specifications, and a full specification with all covariates is also estimated. The regression results are combined with information about survival and morbidity disease burden to calculate the marginal cost per QALY for each type of expenditure: the most conservative results suggest that this is about £8,000 for locally (CCG) commissioned services, while estimates for specialized commissioning and primary care are more uncertain. When this heterogeneity is taken into account, the estimated marginal cost per QALY for all NHS expenditure increases slightly, from about £6,000 to £7,000. Our results suggest that additional investment is likely to be most productive in primary care and in locally commissioned services.",

author = "Stephen Martin and Claxton, {Karl Philip} and James Lomas and Francesco Longo",

note = "{\textcopyright} 2023 The Authors",

year = "2023",

month = jun,

day = "1",

doi = "10.1016/j.healthpol.2023.104800",

language = "English",

volume = "132",

pages = "104800",

journal = "Health Policy",

issn = "0168-8510",

publisher = "Elsevier",

}

TY - JOUR

T1 - The impact of different types of NHS expenditure on health

T2 - Marginal cost per QALY estimates for England for 2016/17

AU - Martin, Stephen

AU - Claxton, Karl Philip

AU - Lomas, James

AU - Longo, Francesco

PY - 2023/6/1

Y1 - 2023/6/1

N2 - English data from 2003 to 2012 suggests that it costs the NHS £10,000 to generate an additional quality-adjusted life year (QALY). This estimate relates to all NHS expenditure and no attempt was made to explore possible heterogeneity within this total. Different types of expenditure - such as secondary care, primary care and specialized commissioning - may have different productivities and estimates of these may help policymakers decide where additional investment is most beneficial. We use the two-stage least squares estimator and data for 2016 to explore the mortality response to three types of healthcare expenditure. Three specifications are estimated for each type of expenditure: backward selection and regularized regression are used to identify parsimonious specifications, and a full specification with all covariates is also estimated. The regression results are combined with information about survival and morbidity disease burden to calculate the marginal cost per QALY for each type of expenditure: the most conservative results suggest that this is about £8,000 for locally (CCG) commissioned services, while estimates for specialized commissioning and primary care are more uncertain. When this heterogeneity is taken into account, the estimated marginal cost per QALY for all NHS expenditure increases slightly, from about £6,000 to £7,000. Our results suggest that additional investment is likely to be most productive in primary care and in locally commissioned services.

AB - English data from 2003 to 2012 suggests that it costs the NHS £10,000 to generate an additional quality-adjusted life year (QALY). This estimate relates to all NHS expenditure and no attempt was made to explore possible heterogeneity within this total. Different types of expenditure - such as secondary care, primary care and specialized commissioning - may have different productivities and estimates of these may help policymakers decide where additional investment is most beneficial. We use the two-stage least squares estimator and data for 2016 to explore the mortality response to three types of healthcare expenditure. Three specifications are estimated for each type of expenditure: backward selection and regularized regression are used to identify parsimonious specifications, and a full specification with all covariates is also estimated. The regression results are combined with information about survival and morbidity disease burden to calculate the marginal cost per QALY for each type of expenditure: the most conservative results suggest that this is about £8,000 for locally (CCG) commissioned services, while estimates for specialized commissioning and primary care are more uncertain. When this heterogeneity is taken into account, the estimated marginal cost per QALY for all NHS expenditure increases slightly, from about £6,000 to £7,000. Our results suggest that additional investment is likely to be most productive in primary care and in locally commissioned services.

U2 - 10.1016/j.healthpol.2023.104800

DO - 10.1016/j.healthpol.2023.104800

M3 - Article

C2 - 37004415

SN - 0168-8510

VL - 132

SP - 104800

JO - Health Policy

JF - Health Policy

M1 - 104800

ER -