Douglas K. Owens, MD, MS; Amir Qaseem, MD, PhD, MHA; Roger Chou, MD; Paul Shekelle, MD, PhD; for the Clinical Guidelines Committee of the American College of Physicians
Health care costs in the United States are increasing unsustainably, and further efforts to control costs are inevitable and essential. Efforts to control expenditures should focus on the value, in addition to the costs, of health care interventions. Whether an intervention provides high value depends on assessing whether its health benefits justify its costs. High-cost interventions may provide good value because they are highly beneficial; conversely, low-cost interventions may have little or no value if they provide little benefit.
Thus, the challenge becomes determining how to slow the rate of increase in costs while preserving high-value, high-quality care. A first step is to decrease or eliminate care that provides no benefit and may even be harmful. A second step is to provide medical interventions that provide good value: medical benefits that are commensurate with their costs.
This article discusses 3 key concepts for understanding how to assess the value of health care interventions. First, assessing the benefits, harms, and costs of an intervention is essential to understand whether it provides good value. Second, assessing the cost of an intervention should include not only the cost of the intervention itself but also any downstream costs that occur because the intervention was performed. Third, the incremental cost-effectiveness ratio estimates the additional cost required to obtain additional health benefits and provides a key measure of the value of a health care intervention.
As the line between interventions becomes more horizontal, the cost-effectiveness ratio becomes less favorable because costs are increasing faster than benefits are. The slope of the line between 2 interventions represents the reciprocal of the cost-effectiveness ratio. A lower incremental cost-effectiveness ratio denotes more favorable cost-effectiveness. The lines between interventions A, B, and C are called the cost-effectiveness frontier. Any intervention with costs and QALYs below and to the right of the cost-effectiveness frontier would be dominated (such as intervention D), or less cost-effective than interventions on the frontier. QALY = quality-adjusted life-year.
The cost-effectiveness ratios of interventions are shown on the lines between the interventions. Intervention E costs $35 000 per QALY gained relative to intervention A. Intervention B costs $15 000 per QALY gained relative to intervention E. Intervention D is dominated. Intervention E can be eliminated through extended dominance. QALY = quality-adjusted life-year.
The In the Clinic® slide sets are owned and copyrighted by the American College of Physicians (ACP). All text, graphics, trademarks, and other intellectual property incorporated into the slide sets remain the sole and exclusive property of the ACP. The slide sets may be used only by the person who downloads or purchases them and only for the purpose of presenting them during not-for-profit educational activities. Users may incorporate the entire slide set or selected individual slides into their own teaching presentations but may not alter the content of the slides in any way or remove the ACP copyright notice. Users may make print copies for use as hand-outs for the audience the user is personally addressing but may not otherwise reproduce or distribute the slides by any means or media, including but not limited to sending them as e-mail attachments, posting them on Internet or Intranet sites, publishing them in meeting proceedings, or making them available for sale or distribution in any unauthorized form, without the express written permission of the ACP. Unauthorized use of the In the Clinic slide sets will constitute copyright infringement.
Owens DK, Qaseem A, Chou R, Shekelle P, for the Clinical Guidelines Committee of the American College of Physicians. High-Value, Cost-Conscious Health Care: Concepts for Clinicians to Evaluate the Benefits, Harms, and Costs of Medical Interventions. Ann Intern Med. 2011;154:174–180. doi: 10.7326/0003-4819-154-3-201102010-00007
Download citation file:
Published: Ann Intern Med. 2011;154(3):174-180.
Guidelines, High Value Care.
Results provided by:
Copyright © 2017 American College of Physicians. All Rights Reserved.
Print ISSN: 0003-4819 | Online ISSN: 1539-3704
Conditions of Use
This PDF is available to Subscribers Only