Presentation (CTI)

OBJECTIVES: Cost-effectiveness thresholds are usually interpreted against estimates of marginal health-sector productivity. However, if budget displacement from new interventions is imperfectly targeted, the relevant opportunity cost may lie closer to the mean cost per quality-adjusted life year (QALY) than the marginal. We aimed to estimate the mean cost per QALY attributable to the National Health Service (NHS) in the United Kingdom relative to the recently revised NICE cost-effectiveness threshold range.
METHODS: We developed a counterfactual framework comparing observed annual population QALY accrual with a scenario in which the health sector did not contribute to post-1948 QALY gains. Counterfactual mortality was constructed by blending 1948 and 2024 age-specific death probabilities assuming that between 40% and 60% of the observed longevity increase was attributable to the health sector. Health-related quality of life was modelled using EQ-5D population norms linked to remaining life expectancy. Mean cost per QALY was estimated using the total England health expenditure.
RESULTS: Observed QALY accrual in 2024 was estimated at 56.9 million. 4.12-5.86 million QALYs were attributable to the health sector. Using England health expenditure of £177.4-181.7 billion, attributable QALYs cost between £30,300 and £44,150 on average. A ten-year distributed-lag specification reduced this to approximately £27,850-£40,350. Lower attribution assumptions increased the estimate substantially.
CONCLUSIONS: With generous assumptions regarding the proportion of health gain attributable to the health sector, the estimated mean cost per QALY attributable to the NHS lies above NICE’s revised £25,000-£35,000 cost-effectiveness threshold range and substantially exceeds published marginal productivity estimates. The high cost could reflect that parts of the health sector are inefficient or that substantial resources are allocated to maintaining the dignity and welfare of individuals with limited QALY gain potential. The mean cost per QALY may be an important complementary reference point for threshold-setting.