OBJECTIVES: Health spillovers arise when an individual’s serious illness affects those close to them emotionally, psychologically, and/or physically. As a result, healthcare interventions that aim to improve the lives of patients may also confer health benefits to both caregiving and non-caregiving family members. However, contrary to widespread calls for health spillovers to be incorporated into health economic evaluation, concern has been expressed that their inclusion will have distributional consequences, with implications for the equity of resource allocation decisions. In this context, this paper sets out a novel approach to health spillover inclusion in health economic evaluation using a ‘prioritarian transformation’ of health gains.

OVERVIEW OF APPROACH: A prioritarian strictly increasing and strictly concave transformation of health gains is proposed. To describe our approach, and without loss of generality, we first define a 3-person ‘family’ (or household) that includes a patient, a caregiving family member, and a non-caregiving family member. Health gains to each family member are first ordinally ranked, then sequentially transformed via a specific functional form (an 'Atkinsonian' transformation function is employed in the paper). Following this, the transformed total is separated into increments applicable to each individual.

Finally, the transformed health increments specific to the caregiver and non-caregiver (i.e., health spillovers), as a proportion of the transformed total, are applied to the non-transformed total health gain. Importantly, patient health benefits are capped at their original, untransformed value, downweighting spillover health gains and prioritising incremental change in the outcomes of the patient.

The axiomatic basis for the approach is examined, while an illustrative example is used to demonstrate its application.

METHODS: N/A, conceptual paper

RESULTS: N/A, conceptual paper

CONCLUSIONS: The prioritarian weighting of health gains allows for explicit normative priority setting in allocative decision making. As such, this approach may provide a feasible means of moderation of equity impacts when incorporating spillovers.