The Relevance of Including Future Healthcare Costs in Cost-Effectiveness Threshold Calculations for the UK NHS

Background and Objective: The supply-side threshold for the UK National Health Service has been empirically estimated as the marginal returns to healthcare spending on health outcomes. These estimates implicitly exclude future healthcare costs, which is inconsistent with the objective of making the most efficient use of healthcare resources. This paper illustrates how empirical estimates of the threshold within healthcare can be adjusted to account for future healthcare costs. Methods: Using cause-deleted life tables and previous work on future costs in England and Wales, we illustrate how such estimates can be adjusted. Results: While the effect of including future healthcare costs can have substantial effects on incremental cost-effectiveness ratios of specific life-extending interventions, we find that including future costs has relatively little impact (an increase of £743 per quality-adjusted life-year) on the threshold estimate. Conclusions: For some life-extending interventions the impact of including future costs on whether an intervention is deemed cost effective may be considerable.