Using CEA to Define Low-Value Care

Ankur Pandya In Media Hub Explaining Concept.

CHDS faculty member Ankur Pandya makes the case for using cost-effectiveness analysis to define low-value care in  “Adding Cost-Effectiveness to Define Low-Value Care” published in JAMA. Pandya shows that common approaches to identifying and studying low-value care in the United States ignore costs, instead focusing on services that harm health (or show no clinical benefit). In other words, “no-value” care has been studied more than “low-value” care in the US. Incremental cost-effectiveness ratios, which are the main results used in cost-effectiveness analyses, can be used to identify low-value health care services that improve the health of patients but are not worth the additional costs required to achieve these health care gains. Incremental cost-effectiveness ratios greater than $100 000 to $150 000 per quality- adjusted life-year (QALY) suggest low-value health care in the United States. Using data from the Tufts Cost-Effectiveness Analysis Registry, Pandya identified 331 US cost-effectiveness analyses published since 2005 with incremental cost-effectiveness ratios >$150,000/QALY. He concludes, “Cost-effectiveness analysis provides a systematic and quantitative basis to distinguish high- from low-value health care for services that improve the health of patients, and it could be a useful tool in the current efforts to identify and reduce low-value health care in the United States.”

Pandya describes the ideas behind a push towards value-centered care in this video:

Learn more: Explore the CHDS page about cost-effectiveness analysis.
Learn more: Read more about cost-effectiveness analysis in the CHDS repository.

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