Is the Societal Perspective in Cost-Effectiveness Analysis Useful for Decision Makers?

Abstract

The U.S. Public Health Service's Panel on Cost-Effectiveness in Health and Medicine recommends that cost-effectiveness analyses (CEAs) intended to help allocate health resources in the public interest include a reference case analysis, conducted from the perspective of society as a whole. This perspective requires that an analysis measure all health effects and changes in resource use caused by an intervention. VALUE OF SOCIETAL CEAs: Tensions unavoidably arise among the parties to medical decisions--patients, their families and friends, clinicians, and third-party payers. One common approach to handling these tensions is to ignore some of them, to "solve" them by pretending they do not or should not exist. Patients do this when they demand the best care for themselves without regard to the cost to others, payers when they make coverage decisions that shift costs ot others. But by estimating all gains and losses, calculations that reflect the safety, effectiveness, and side effects of an intervention as well as its costs, societal CEAs can help resolve those tensions and provide the basis for decisions that are fair to all parties, an agenda for negotiating such decisions, and information essential for designing compensation and incentives to support them. MAKING BETTER USE OF SOCIETAL CEAs: Use of the societal perspective asks that all parties be aware of and consider the interests of others. Some process or procedure needs to be developed for presenting CEA information to the parties most likely to be affected by decisions, soliciting their views, and negotiating an acceptable decision. This process could be used by government decision makers or by managed care organizations, professional societies, or payers.