Median-Based Incremental Cost-Effectiveness Ratio (ICER)

• Activity Number: 230
• Type: Topic Contributed
• Date/Time: Monday, August 2, 2010 : 2:00 PM to 3:50 PM
• Sponsor: Health Policy Statistics Section
• Author(s): Heejung Bang*+ and Hongwei Zhao
• Companies: Weill Cornell Medical College and Texas A&M Health Science Center
• Keywords: cost-effectiveness analysis ; cost-effectiveness plane ; incremental cost-effectiveness ratio (ICER) ; mean ; median

Abstract

Cost-effectiveness analysis (CEA) is a type of economic evaluation that examines the costs and health outcomes of alternative strategies and has been applied in various fields. Incremental cost-effectiveness ratio (ICER) that represents the additional cost of one unit of outcome gained by a new strategy, when compared to a competing strategy, has served as the most popular methodology in the CEA. Despite the extreme popularity of this method, statistical measures other than 'mean' as summary statistics have not been considered in the CEA context. We propose median-based ICER and suggest mean- and median-based ICERs should be considered together as 'complementary' tools in CEA for informed decision making, acknowledging the pros and cons of each method. For example, if the two ICERs provide different results, our confidence about the CE of a treatment may need to be adjusted accordingly.