How NICE

By October 7, 2009November 2nd, 2009Commentary

A Nature story describes Britain’s National Institute for Health and Clinical Excellence  and explains  some of the controversy surrounding the institution.  Britain has a health system in which the government pays for almost all care for everyone and owns the actual medical care facilities, inpatient and outpatient.  The government controls the entire system, known as the NHS.  It has been pointed to by proponents and opponents of reform in the United States as an example of good or bad outcomes.  (Nature Article)

Because the government controls the system, funding and care become very political.  NICE was established to help decide what the government system should pay for and in essence what care a patient has access to.  NICE is the quintessential comparative effectiveness and cost-effectiveness research body.  It obviously has a thankless task, one it has tried to do with professionalism and high degree of scientific integrity.

NICE and other researchers have a particularly tricky job in trying to assign a value to certain states of health over time; a year of pain-free good health compared to one in significant pain, for example.  NICE uses the Quality Adjusted Life Year (QALY) most frequently in its analysis.  This measure attempts to quantify the utility value of a particular state of health over time.   The Nature article provides an excellent explanation of this measure.   Once it has identified a QALY associated with a particular drug, device or procedure, the NICE must decide if it is worth paying for with government funds in the NHS.  The cutoff line is around $50,000 in most cases.

The difficulty with a body such as the NICE is that it has been asked both to do a relatively scientific analysis and make a social judgment about value.  Americans would be unlikely to accept the second role and it is probably less necessary when significant payment for health care comes directly from patients and other private sources.  One way to avoid needing a committee which decides what gets paid for with public funds is to have less of health care paid for by those public funds, not more as is proposed in most health reform bills.  Careful analysis of census data indicates that most Americans can pay for their routine health needs out-of-pocket and the system might have a better set of economic incentives if we attempted to move back to having consumers pay providers directly where they can.

Leave a comment