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Click the accept button to hide this notification. A safety and health management system means the part of the Organisation's management system which covers:. The system should cover the entire gambit of an employer's occupational health and safety organisation. The key elements of a successful safety and health management system are:. The workplace should prepare an occupational safety and health policy programme as part of the preparation of the Safety Statement required by Section 20 of the Safety, Health and Welfare at Work Act Effective safety and health policies should set a clear direction for the organisation to follow.

They will contribute to all aspects of business performance as part of a demonstrable commitment to continuous improvement. Responsibilities to people and the working environment will be met in a way that fulfils the spirit and letter of the law. Cost-effective approaches to preserving and developing human and physical resources will reduce financial losses and liabilities.

In a wider context, stakeholders' expectations, whether they are shareholders, employees or their representatives, customers or society at large, can be met. The workplace should formulate a plan to fulfil its safety and health policy as set out in the Safety Statement. An effective management structure and arrangements should be put in place for delivering the policy. Safety and health objectives and targets should be set for all managers and employees.

For effective implementation, organisations should develop the capabilities and support mechanisms necessary to achieve the safety and health policy, objectives and targets. All staff should be motivated and empowered to work safely and to protect their long-term health, not simply to avoid accidents. These arrangements should be:.

There should be a planned and systematic approach to implementing the safety and health policy through an effective safety and health management system. The aim is to minimise risks. Risk Assessment methods should be used to determine priorities and set objectives for eliminating hazards and reducing risks. Wherever possible, risks should be eliminated through the selection and design of facilities, equipment and processes. If risks cannot be eliminated, they should be minimised by the use of physical controls and safe systems of work or, as a last resort, through the provision of PPE.

Performance standards should be established and used for measuring achievement. Specific actions to promote a positive safety and health culture should be identified. The visible and active leadership of senior managers fosters a positive safety and health culture.

The organisation should measure, monitor and evaluate safety and health performance. Performance can be measured against agreed standards to reveal when and where improvement is needed. Active self-monitoring reveals how effectively the safety and health management system is functioning. Self-monitoring looks at both hardware premises, plant and substances and software people, procedures and systems, including individual behaviour and performance.

If controls fail, reactive monitoring should find out why they failed, by investigating the accidents, ill health or incidents, which could have caused harm or loss. The objectives of active and reactive monitoring are:. The organisation should review and improve its safety and health management system continuously, so that its overall safety and health performance improves constantly. The organisation can learn from relevant experience and apply the lessons. There should be a systematic review of performance based on data from monitoring and from independent audits of the whole safety and health management system.

There should be a strong commitment to continuous improvement involving the development of policies, systems and techniques of risk control. Performance should be assessed by:. Many companies now report on how well they have performed on worker safety and health in their annual reports and how they have fulfilled their responsibilities with regard to preparing and implementing their Safety Statements. An organisation should carry out an initial review of the safety and health management system, and follow this up with periodic reviews. The initial review should compare existing safety and health practice with:.

A Safety Statement should have a safety and health policy incorporated into it. What is this policy? The safety and health policy must:. Critical safety and health issues, which should be addressed and allocated resources, in the safety and health policy, include the:. However, this list is not exhaustive and the critical safety and health issues that could be covered by the policy will depend on the risks in the organisation.

7 Incorporating economic evaluation | Developing NICE guidelines: the manual | Guidance | NICE

If the above issues are adequately covered elsewhere in the Safety Statement or in the safety and health management system, they might need only to be referred to in the safety and health policy. Backup documentation may also be referred to in the policy. Safety and health policies are specific to each individual organisation The content of the policy of an organisation should be based on the hazards and risks present in the organisation and should reflect the fact that systematic hazard identification and risk assessment have been undertaken.

As a minimum, the policy should contain a commitment that safety and health legislation will be complied with and should specify those responsible for implementing the policy at all levels in the organisation and define their responsibilities. To all employees: As your employer, we are required to comply with all safety and health legislation that applies to this company.

With this in mind we have carried out Risk Assessments of all our key operations and processes in all the workplaces we control. We have discussed these Risk Assessments with all relevant employees and worked with the safety committee in preparing this Safety Statement.


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This statement sets out the safety and health measures we are implementing to protect everyone who works here. I am committed to ensuring that the safety and health measures set out in our Safety Statement are met. John Kelly, Safety and Health Manager, will give advice and information on how to comply with this Safety Statement but everyone, especially if you are in a management or supervisory position, is responsible for ensuring compliance where they work.

We expect all employees to co-operate with us so that we can achieve our target of avoiding accidents. Consultation on safety and health matters, between senior managers and all employees, will be carried out through the safety committee, which you have selected.

You must play your part under the Safety Statement. Comply with all the safety and health rules for your area. Work safely and think of others as you do. Know and understand the Risk Assessments for your area. Report safety and health problems to your supervisor. Know who your safety representative is and contact him or her with any safety and health enquiries you may have. What are the responsibilities of management regarding the implementation of safety and health in the organisation?

Responsibility for safety and health management ultimately rests with the employer. This responsibility is normally delegated to executive directors, senior managers, line managers, supervisors and employees. The organisational and reporting structure for implementing these duties should be illustrated in an in-house organisational chart. Accidents, ill health and incidents are seldom random events. They generally arise from failures of control and involve multiple contributory elements. The immediate cause may be a human or technical failure, but such events usually arise from organisational failings, which are the responsibility of management.

Successful safety and health management systems aim to utilise the strengths of managers and other employees. The organisation needs to understand how human factors affect safety and health performance. Senior executive directors or other senior management controlling body members and executive senior managers are primarily responsible for safety and health management in the organisation. These people need to ensure that all their decisions reflect their safety and health intentions, as articulated in the Safety Statement, which should cover:.

Although organisations routinely contract out either all or parts of their work activities, they may still retain some of the legal responsibility for health and safety, particularly if they directly control how this work is done. For this reason, the organisation should establish and maintain procedures for controlling the safety and health aspects of contractor work. These should include:. Additionally, it is also necessary for organisations to check the ability of contractors where they work close to, or in collaboration with, direct employees or with other contractor's employees. Such arrangements should cover the:.

Effective safety and health management includes effective emergency planning. What should this cover? The organisation should establish and maintain procedures to respond to accidents and emergency situations, and to prevent and minimise the safety and health impacts associated with them. Emergency planning should cover:. The organisation should periodically test, review and revise its emergency preparedness and response procedures where necessary, in particular after the occurrence of accidents or emergency situations.

The emergency plan should dovetail with the Safety Statement as required by Section 20 of the Act. Details of what is required are covered at Control of Major Accident Hazards on this website. The following are some key questions for employers to assist in determining the adequacy of their safety and health management in the organisation:. It should be a line-management responsibility to monitor safety and health performance against predetermined plans and standards. Two types of monitoring are required:. Every organisation should collect information to investigate the causes of substandard performance or conditions adequately.

Documented procedures for carrying out these activities on a regular basis for key operations should be established and maintained. The monitoring system should include:. Techniques that should be used for active measurement of the safety and health management system include:. A system of internal reporting of all accidents which includes ill health cases and incidents of non-compliance with the safety and health management system should be set up so that the experience gained may be used to improve the management system.

The organisation should encourage an open and positive approach to reporting and follow-up and should also put in place a system of ensuring that reporting requirements are met. Those responsible for investigating accidents, and incidents should be identified and the investigation should include plans for corrective action, which incorporate measures for:.

Monitoring provides the information to let the organisation review activities and decide how to improve performance. Auditing and performance review are the final steps in the safety and health management control cycle. The organisation should establish and maintain a programme and procedures for periodic safety and health management system audits to be carried out. This enables a critical appraisal of all the elements of the safety and health management system to be made.

Auditing is the structured process of collecting independent information on the efficiency, effectiveness and reliability of the total safety and health management system and drawing up plans for corrective action. These audits should be carried out i n addition to routine monitoring, inspection and surveillance of the safety and health management system. The purpose of these audits is to ensure the continued suitability, adequacy and effectiveness of the safety and health management system. The audit process should ensure that the necessary information is collected to allow management to carry out this evaluation adequately.

The organisation should establish and maintain audit records consistent with the safety and health management system records. Their retention times should be established and must comply with legal requirements.

Account Options

Further information on setting up and operating a safety and health management system audit is given in Appendix E of the Authority's Workplace Safety and Health Management. The protocols and procedures for the audit on the health and safety management system should include the following:. The key questions that an employer should ask when measuring, reviewing and auditing their safety and health performance are:.

Under Section 10 of the Safety, Health and Welfare at Work Act , employers must provide their employees with the instruction and training necessary to ensure their safety and health. There are specific training obligations for employees involved in the safety consultation and safety representation processes. Safety and health training must form part of the training of all people who work at the workplace. Training helps people acquire the skills, knowledge and attitudes to make them competent in the safety and health aspects of their work.

It includes formal off-the-job training, instruction to individuals and groups, and on-the-job coaching and counselling. However, training is not a substitute for proper risk control, for example to compensate for poorly designed plant or inadequate workstations. The key to effective training is to understand job requirements and individual abilities. In order to train staff to ensure they obtain the necessary skills, knowledge and attitudes to make them competent in the safety and health aspects of their work, it is important to identify appropriate training objectives and methods by first identifying the training needs.

Training needs may be organisational, job-related and individual:. Job-related needs: These fall into two main types - management needs and non-management needs.

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Individual needs: Individual needs are generally identified through performance appraisal. They may also arise because an individual has not absorbed formal job training or information provided as part of their induction. Training needs vary over time, and assessments should cover:. Organisations should ensure they have access to sufficient safety and health knowledge, skills or experience to identify and manage safety and health risks effectively, and to set appropriate objectives by:.

Whichever method or combination of these methods is chosen by an organisation it does not relieve the employer and the management of the organisation from their legal responsibilities to ensure a safe workplace. Cost—utility analysis is a form of cost-effectiveness analysis that uses utility as a common outcome. It considers people's quality of life and the length of life they will gain as a result of an intervention or a programme. The health effects are expressed as QALYs, an outcome that can be compared between different populations and disease areas. Costs of resources, and their valuation, should be related to the prices relevant to the sector.

If a cost—utility analysis is not possible for example, when outcomes cannot be expressed using a utility measure such as the QALY , a cost—consequences analysis may be considered. Cost—consequences analysis can consider all the relevant health and non-health effects of an intervention across different sectors and reports them without aggregation.

A cost—consequences analysis is useful when different outcomes cannot be incorporated into an index measure. It is helpful to produce a table that summarises all the costs and outcomes and enables the options to be considered in a concise and consistent manner. Outcomes that can be monetised are quantified and presented in monetary terms.

Some effects cannot readily be quantified such as reductions in the degree of bullying or discrimination and should be considered by decision-making committees as part of a cost—consequences analysis alongside effects that can be quantified. All effects even if they cannot be quantified and costs of an intervention are considered when deciding which interventions represent the best value.

Effectively, cost—consequences analysis provides a 'balance sheet' of outcomes that decision-makers can weigh up against the costs of an intervention including related future costs. If, for example, a commissioner wants to ensure the maximum health gain for the whole population, they might prioritise the incremental cost per QALY gained. But if reducing health inequalities is the priority, they might focus on interventions that work best for the most disadvantaged groups, even if they are more costly and could reduce the health gain achieved in the population as a whole.

Cost-effectiveness analysis uses a measure of outcome a life year saved, a death averted, a patient-year free of symptoms and assesses the cost per unit of achieving this outcome by different means. The outcome is not separately valued, only quantified; so the study takes no view on whether the cost is worth incurring, only focusing on the cost of different methods of achieving units of outcome. Cost-minimisation analysis is the simplest form of economic analysis, which can be used when the health effects of an intervention are the same as those of the status quo, and when there are no other criteria for whether the intervention should be recommended.

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For example, cost-minimisation analysis could be used to decide whether a doctor or nurse should give routine injections when it is found that both are equally effective at giving injections on average. In cost-minimisation analysis, an intervention is cost effective only if its net cost is lower than that of the status quo. The disadvantage of cost-minimisation analysis is that the health effects of an intervention cannot often be considered equal to those of the status quo. Cost—benefit analysis considers health and non-health effects but converts them into monetary values, which can then be aggregated.

Once this has been done, 'decision rules' are used to decide which interventions to undertake. Several metrics are available for reporting the results of cost—benefit analysis. Cost—utility analysis is required routinely by NICE for the economic evaluation of health-related interventions, programmes and services, for several reasons:. When used in conjunction with an NHS and PSS perspective, it provides a single yardstick or 'currency' for measuring the impact of interventions. It also allows interventions to be compared so that resources may be allocated more efficiently.

Where possible, NICE programmes use a common method of cost-effectiveness analysis that allows comparisons between programmes. However, because local government is largely responsible for implementing public health and wellbeing programmes and for commissioning social care, NICE has broadened its approach for the appraisal of interventions in these areas. Local government is responsible not only for the health of individuals and communities, but also for their overall welfare. The tools used for economic evaluation must reflect a wider remit than health and allow greater local variation.

The nature of the evidence and that of the outcomes being measured may place more emphasis on cost—consequences analysis and cost—benefit analysis for interventions in these areas. The type of economic analysis that should be considered is informed by the setting specified in the scope of the guideline, and the extent to which the effects resulting from the intervention extend beyond health.

Simple methods may be used if these can provide the committee with enough information on which to base a decision. For example, if an intervention is associated with better effectiveness and fewer adverse effects than its comparator, then an estimate of cost may be all that is needed. Or a simple decision tree may provide a sufficiently reliable estimate of cost effectiveness.


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In other situations a more complex approach, such as Markov modelling or discrete event simulation, may be warranted. The measurement of changes in health-related quality of life should be reported directly from people using services or their carers. For some economic analyses, a flexible approach may be needed, reflecting the nature of effects delivered by different interventions or programmes. The methods used for identifying the data should be systematic and transparent.

The justification for choosing a particular data set should be clearly explained. The mapping function chosen should be based on data sets containing both health-related quality-of-life measures. The statistical properties of the mapping function should be fully described, its choice justified, and it should be adequately demonstrated how well the function fits the data. Sensitivity analyses exploring variation in the use of the mapping algorithms on the outputs should be presented. This evidence should be derived from a synthesis of peer-reviewed literature. In these circumstances, alternative health-related quality of life measures may be used and must be accompanied by a carefully detailed account of the methods used to generate the data, their validity, and how these methods affect the utility values.

When necessary, consideration should be given to alternative standardised and validated preference-based measures of health-related quality of life that have been designed specifically for use in children. Guideline developers should:. The QALY remains the most suitable measure for assessing the impact of services, because it can incorporate effects from extension to life and experience of care. However, if linking effects to a QALY gain is not possible, links to a clinically relevant or a related outcome should be considered.

Outcomes should be optimised for the lowest resource use. The link either direct or indirect of any surrogate outcome, such as a process outcome for example, bed days , to a clinical outcome needs to be justified. For some decision problems such as for interventions with a social care focus , the intended outcomes of interventions are broader than improvements in health status.

Here broader, preference-weighted measures of outcomes, based on specific instruments, may be more appropriate. Similarly, depending on the topic, and on the intended effects of the interventions and programmes, the economic analysis may also consider effects in terms of capability and wellbeing.

If an intervention is associated with both health- and non-health-related effects, it may be helpful to present these elements separately. Departures from the reference case may sometimes be appropriate; for example, when there are not enough data to estimate QALYs gained. Any such departures must be agreed with members of NICE staff with a quality assurance role and highlighted in the guideline with reasons given. The usual perspective for the economic analysis of public health interventions is that of the public sector.

This may be simplified to a local government perspective if few costs and effects apply to other government agencies. Whenever there are multiple outcomes, a cost—consequences analysis is usually needed, and the committee weighs up the changes to the various outcomes against the changes in costs in an open and transparent manner.

However, for the base-case analysis, a cost—utility analysis should be undertaken using a cost per QALY approach where possible. A societal perspective may be used, and will usually be carried out using cost—benefit analysis. When a societal perspective is used, it must be agreed with NICE staff with responsibility for quality assurance and highlighted in the guideline with reasons given. Effects on people using services and carers whether expressed in terms of health effects, social care quality of life, capability or wellbeing are the intended outcomes of social care interventions and programmes.

Although holistic effects on people using services, their families and carers may represent the ideal perspective on outcomes, a pragmatic and flexible approach is needed to address different perspectives, recognising that improved outcomes for people using services and carers may not always coincide.

Any economic model should take account of the proportion of care that is publicly funded or self-funded. Scenario analysis may also be useful to take account of any known differences between local authorities in terms of how they apply eligibility criteria. Scenario analysis should also be considered if the cost of social care varies depending on whether it is paid for by local authorities or by individual service users; the value of unpaid care should also be taken into account where appropriate.

It is envisaged that the analytical difficulties involved in creating clear, transparent decision rules around the costs that should be considered, and for which interventions and outcomes, will be particularly problematic for social care. These should be discussed with the committee before any economic analysis is undertaken and an approach agreed. An economic analysis uses decision-analytic techniques with outcome, cost and utility data from the best available published sources.

Some inputs, such as costs, may have standard sources that are appropriate, such as national list prices or a national audit, but for others appropriate data will need to be sourced. Additional searches may be needed; for example, if searches for evidence on effects do not provide the information needed for economic modelling. Additional information may be needed on:. Although it is desirable to conduct systematic literature reviews for all such inputs, this is time-consuming and other pragmatic options for identifying inputs may be used.

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Informal searches should aim to satisfy the principle of 'saturation' that is, to 'identify the breadth of information needs relevant to a model and sufficient information such that further efforts to identify more information would add nothing to the analysis' Kaltenthaler et al. Studies identified in the review of evidence on effects should be scrutinised for other relevant data, and attention should be paid to the sources of parameters in analyses included in the systematic review of published economic evaluations. Alternatives could include asking committee members and other experts for suitable evidence or eliciting their opinions, for example, using formal consensus methods such as the Delphi technique or the nominal-group technique.

If a systematic review is not possible, transparent processes for identifying model inputs should be reported; the internal quality and external validity of each potential data source should be assessed and their selection justified. Further guidance on searching and selecting evidence for key model inputs is available from Kaltenthaler et al. Data from registries and audits may be used to inform both estimates of effectiveness and any modelling, particularly for service delivery questions.

To obtain such data, it may be necessary to negotiate access with the organisations and individuals that hold the data, or to ask them to provide a summary for inclusion in the guidance if published reports are insufficient. Any processes used for accessing data will need to be reported in the health economic plan and in the guideline.

For some questions, there may be good reason to believe that relevant and useful information exists outside of literature databases or validated national data sources. Examples include ongoing research, a relatively new intervention and studies that have been published only as abstracts. For some guidelines, econometric studies provide a supplementary source of evidence and data for bespoke economic models. For these studies, the database 'Econlit' should be searched as a minimum. Some information on unit costs may be found in the Personal Social Services Research Unit report on unit costs of health and social care or the Department of Health's reference costs provider perspective.

Information on resource impact costings can be found in NICE's methods guide on resource impact assessment. Some information about public services may be better obtained from national statistics or databases, rather than from published studies. Philips et al. In cases where current costs are not available, costs from previous years should be adjusted to present value using inflation indices appropriate to the cost perspective, such as the hospital and community health services HCHS index and the PSS pay and prices index, available from the PSSRU report on unit costs of health and social care or the Office for National Statistics ONS consumer price index.

Wherever possible, costs relevant to the UK healthcare system should be used. However, in cases where only costs from other countries are available these should be converted to Pounds Sterling using an exchange rate from an appropriate and current source such as HM Revenue and Customs or Organisation for Economic Co-operation and Development. When there are nationally available price reductions for example, for medicines procured for use in secondary care through contracts negotiated by the NHS Commercial Medicines Unit , the reduced price should be used in the reference-case analysis to best reflect the price relevant to the NHS.

Analyses based on price reductions for the NHS will be considered only when the reduced prices are transparent and can be consistently available across the NHS, and when the period for which the specified price is available is guaranteed. When a reduced price is available through a patient access scheme that has been agreed with the Department of Health and Social Care, the analyses should include the costs associated with the scheme. For medicines that are predominantly dispensed in the community, prices should be based on the Drug Tariff.

In the absence of a published list price and a price agreed by a national institution as may be the case for some devices , an alternative price may be considered, provided that it is nationally and publicly available. If no other information is available on costs, local costs obtained from the committee may be used. Preference-based quality-of-life data are often needed for economic models. Many of the search filters available are highly sensitive and so, although they identify relevant studies, they also detect a large amount of irrelevant data.

An initial broad literature search for quality-of-life data may be a good option, but the amount of information identified may be unmanageable depending on the key issue being addressed. It may be more appropriate and manageable to incorporate a quality of life search filter when performing additional searches for key issues of high economic priority.

When searching bibliographic databases for health-state utility values, specific techniques outlined in Ara and Golder et al. The provision of quality-of-life data should be guided by the health economist at an early stage during guideline development so that the information specialist can adopt an appropriate strategy.

The committee should discuss any potential bias and limitations of economic models. Sensitivity analysis should be used to explore the impact that potential sources of bias and uncertainty could have on model results. Deterministic sensitivity analysis should be used to explore key assumptions used in the modelling. This should test whether and how the model results change under alternative, plausible scenarios. Common examples of when deterministic sensitivity analysis could be conducted are:. Deterministic sensitivity analysis should also be used to test any bias resulting from the data sources selected for key model inputs.

Probabilistic sensitivity analysis can be used to account for uncertainty arising from imprecision in model inputs. The use of probabilistic sensitivity analysis will often be specified in the health economic plan. Any uncertainty associated with all inputs can be simultaneously reflected in the results. In non-linear decision models where outputs are a result of a multiplicative function for example, in Markov models , probabilistic methods also provide the best estimates of mean costs and outcomes.

The choice of distributions used should be justified; for example, in relation to the type of parameter and the method of its estimation. Presentation of the results of probabilistic sensitivity analysis could include scatter plots or confidence ellipses, with an option for including cost-effectiveness acceptability curves and frontiers. When a probabilistic sensitivity analysis is carried out, a value of information analysis may be considered to indicate whether more research is necessary, either before recommending an intervention or in conjunction with a recommendation.

The circumstances in which a value of information analysis should be considered will depend on whether more information is likely to be available soon and whether this information is likely to influence the decision to recommend the intervention. When probabilistic methods are unsuitable, the impact of parameter uncertainty should be thoroughly explored using deterministic sensitivity analysis, and the decision not to use probabilistic methods should be justified in the guideline.

Consideration can be given to including structural assumptions and the inclusion or exclusion of data sources in probabilistic sensitivity analysis. In this case, the method used to select the distribution should be outlined in the guideline Jackson et al.

Cost-effectiveness results should reflect the present value of the stream of costs and benefits accruing over the time horizon of the analysis. For the reference case, the same annual discount rate should be used for both costs and benefits. Sensitivity analyses using 1. A discount rate of 1.

However, the committee will need to be satisfied that the recommendation does not commit the funder to significant irrecoverable costs. The relevance of subgroup analysis to decision-making should be discussed with the committee. When appropriate, economic analyses should estimate the cost effectiveness of an intervention in each subgroup. For service delivery questions, cost-effectiveness analyses may need to account for local factors, such as the expected number of procedures and the availability of staff and equipment at different times of the day, week and year.

Service delivery models may need to incorporate the fact that each local provider may be starting from a different baseline of identified factors for example, the number of consultants available at weekends. It is therefore important that these factors are identified and considered by the committee. Where possible, results obtained from the analysis should include both the national average and identified local scenarios to ensure that service delivery recommendations are robust to local variation. Service designs under consideration might result in occasional service failure — that is, where the service does not operate as planned.

For example, a service for treating myocardial infarction may have fewer places where people can be treated at weekends compared with weekdays as a result of reduced staffing. Therefore more people will need to travel by ambulance and the journey time will also be longer. Given the limited number of ambulances, a small proportion may be delayed, resulting in consequences in terms of costs and QALYs. Such possible service failures should be taken into account in effectiveness and economic modelling. This effectively means that analyses should incorporate the 'side effects' of service designs.

Introducing a new service or increasing capacity will often result in an increase in demand. This could mean that a service does not achieve the predicted effectiveness because there is more demand than was planned for. This should be addressed either in the analysis or in considerations. NICE's economic evaluation of healthcare and public health interventions does not include equity weighting — a QALY has the same weight for all population groups.

It is important to recognise that care provision, specifically social care, may be means tested, and that this affects the economic perspective in terms of who bears costs — the public sector or the person using services or their family. Economic evaluation should reflect the intentions of the system. For an economic analysis to be useful, it must inform the guideline recommendations.

Within the context of NICE's principles on social value judgements, the committee should be encouraged to consider recommendations that:. The committee's interpretations and discussions should be clearly presented in the guideline. This should include a discussion of potential sources of bias and uncertainty. It should also include the results of sensitivity analyses in the consideration of uncertainty, as well as any additional considerations that are thought to be relevant. It should be explicitly stated if economic evidence is not available, or if it is not thought to be relevant to the question.

If there is strong evidence that an intervention dominates the alternatives that is, it is both more effective and less costly , it should normally be recommended. In doing so, the committee should also refer to NICE's principles on social value judgements also see below. The degree of certainty around the ICER.

In particular, advisory bodies will be more cautious about recommending a technology when they are less certain about the ICERs presented in the cost-effectiveness analysis. The presence of strong reasons indicating that the assessment of the change in the quality of life has been inadequately captured, and may therefore misrepresent, the health gain.

When the intervention is an innovation that adds demonstrable and distinct substantial benefits that may not have been adequately captured in the measurement of health gain. When assessing the cost-effectiveness of competing courses of action, the committee should not give particular priority to any intervention or approach that is currently offered. In any situation where 'current practice', compared with an alternative approach, generates an ICER above a level that would normally be considered cost effective, the case for continuing to invest in it should be carefully considered, based on similar levels of evidence and considerations that would apply to an investment decision.

The committee should be mindful of whether the intervention is consuming more resource than its value is contributing based on NICE's cost per QALY threshold. In the reference case, an additional QALY should receive the same weight regardless of any other characteristics of the people receiving the health benefit.

What should be contained in the system audit protocols and procedures?

The estimation of QALYs, as defined in the reference case, implies a particular position regarding the comparison of health gained between individuals. Therefore, in the reference case, an additional QALY is of equal value regardless of other characteristics of the individuals, such as their socio-demographic characteristics, their age, or their level of health.

The guideline committee has discretion to consider a different equity position, and may do so in certain circumstances and when instructed by the NICE Board see below. In the reference case, the committee will regard all QALYs as being of equal weight. However, the committee can accept analysis that explores a QALY weighting that is different from that of the reference case when an intervention concerns a 'life-extending treatment at the end of life'. Outside the health sector, it is more difficult to judge whether the benefits accruing to the non-health sectors are cost effective, but it may be possible to undertake cost—utility analysis based on measures of social care-related quality of life.

The committee should take into account the factors it considers most appropriate when making decisions about recommendations. These could include non-health-related outcomes that are valued by the rest of the public sector, including social care. It is possible that over time, and as the methodology develops including the establishment of recognised standard measures of utility for social care , there will be more formal methods for assessing cost effectiveness outside the health sector.

When considering cost—benefit analysis, the committee should be aware that an aggregate of individual 'willingness to pay' WTP is likely to be more than public-sector WTP, sometimes by quite a margin. If a conversion factor has been used to estimate public sector WTP from an aggregate of individual WTP, the committee should take this into account. In the absence of a conversion factor, the committee should consider the possible discrepancy in WTP when making recommendations that rely on a cost—benefit analysis. The committee should not recommend interventions with an estimated negative net present value NPV unless other factors such as social value judgements are likely to outweigh the costs.

Given a choice of interventions with positive NPVs, committees should prefer the intervention that maximises the NPV, unless other objectives override the economic loss incurred by choosing an intervention that does not maximise NPV. Care must be taken with published cost—benefit analyses to ensure that the value of all the health and relevant non-health effects have been included. Older cost—benefit analyses, in particular, often consist of initial costs called 'costs' and subsequent cost savings called 'benefits' and fail to include monetarised health effects and all relevant non-health effects.

The committee should ensure that, where possible, the different sets of consequences do not double count costs or effects. The way that the sets of consequences have been implicitly weighted should be recorded as openly, transparently and accurately as possible. Cost—consequences analysis then requires the decision-maker to decide which interventions represent the best value using a systematic and transparent process. Various tools, such as multi-criteria decision analysis MCDA , are available to support this part of the process, although attention needs to be given to any weightings used, particularly with reference to the NICE reference case and NICE's principles on social value judgements.

However, if one intervention is more effective but also more costly than another, then the ICER should be considered. If one intervention appears to be more effective than another, the committee has to decide whether it represents reasonable 'value for money' as indicated by the relevant ICER. The committee should use an established ICER threshold see the section on cost—utility analysis.

In the absence of an established threshold, the committee should estimate a threshold it thinks would represent reasonable 'value for money' as indicated by the relevant ICER. The committee should take account of NICE's principles on social value judgements when making its decisions. Cost minimisation can be used when the difference in effects between an intervention and its comparator is known to be small and the cost difference is large for example, whether doctors or nurses should give routine injections.

If it cannot be assumed from prior knowledge that the difference in effects is sufficiently small, ideally the difference should be determined by an equivalence trial, which usually requires a larger sample than a trial to determine superiority or non-inferiority. For this reason, cost-minimisation analysis is only applicable in a relatively small number of cases.

When no relevant published studies are found, and a new economic analysis is not prioritised, the committee should make a qualitative judgement about cost effectiveness by considering potential differences in resource use and cost between the options alongside the results of the review of evidence of effectiveness. This may include considering information about unit costs, which should be presented in the guideline. The committee's considerations when assessing cost effectiveness in the absence of evidence should be explained in the guideline.

Decisions about whether to recommend interventions should not be based on cost effectiveness alone. The committee should also take into account other factors, such as the need to prevent discrimination and to promote equity. These factors should be explained in the guideline. Medical Decision Making — Anderson R Systematic reviews of economic evaluations: utility or futility? Health Economics — Pharamcoeconomics 35 Suppl 1 — Value in Health A—1. Oxford: Oxford University Press. Expert Review of Pharmacoeconomics and Outcomes Research —9. NHS economic evaluation database handbook.

Medical Care 32— Department of Energy and Climate Change Quality assurance: guidance for models. British Medical Journal — Eccles M, Mason J How to develop cost-conscious guidelines. Health Technology Assessment 5: 1— Golder S, Glanville J, Ginnelly L Populating decision-analytic models: the feasibility and efficiency of database searching for individual parameters.

HM Treasury Review of quality assurance of government analytical models: final report. British Medical Journal 1. National Audit Office Framework to review models. CRD report number 6, 2nd edition. National Institute for Health and Clinical Excellence Social care guidance development methodology workshop December report on group discussions. National Institute for Health and Care Excellence Assessing resource impact process manual: guidelines. Paisley S Identification of evidence for key parameters in decision-analytic models of cost-effectiveness: a description of sources and a recommended minimum search requirement.

Pharmacoeconomics — Health Technology Assessment 8: 1— Raftery J, editor — Economics notes series. British Medical Journal [accessed 3 September ]. Value in Health — Rome, Italy, June 17 to 21 Process Tools and resources 1 Introduction and overview 2 The scope 3 Decision-making committees 4 Developing review questions and planning the evidence review 5 Identifying the evidence: literature searching and evidence submission 6 Reviewing research evidence 7 Incorporating economic evaluation 8 Linking to other guidance 9 Writing the guideline 10 The validation process for draft guidelines, and dealing with stakeholder comments 11 Finalising and publishing the guideline 12 Resources to support putting the guideline into practice 13 Ensuring that published guidelines are current and accurate 14 Updating guidelines 15 Appendices Glossary Update information.

Next 7 Incorporating economic evaluation 7. Choosing the most appropriate reference case depends on whether or not the interventions undergoing evaluation: are commissioned by the NHS and PSS alone or by any other public sector body focus on social care outcomes.