Finding legitimacy for the role of budget impact in drug reimbursement decisions

M.G.H. Niezen, Antoinette de Bont, Jan J V Busschbach, Joshua P Cohen, Elly A Stolk

Research output: Contribution to journalArticleScientificpeer-review

21 Citations (Scopus)

Abstract

OBJECTIVES: Research has shown that effectiveness, cost-effectiveness, and severity of illness each play a role in drug reimbursement decisions. However, the role of budget impact in such decisions is less obvious. Policy makers almost always demand a budget impact estimate yet seem reluctant to formally include budget impact as a rationing criterion. Health economists even reject budget impact as a legitimate criterion. For these reasons, it is important to examine its use in rationing decisions, and rationales underlying its use.

METHODS: We trace several rationales supporting the use of budget impact through a literature review, supplemented by semistructured interviews with eleven key stakeholders involved in drug reimbursement decisions in the Netherlands.

RESULTS: Budget impact arguments are used in certain instances, although policy makers appear uncomfortable with its use because well described rationales still are lacking. In addition, we identify the following rationales to support budget impact as a rationing criterion: opportunity costs, loss aversion, uncertainty and equal opportunity.

CONCLUSIONS: Budget impact plays a role in drug reimbursement decisions and has rationales to support its use. However, policy makers do not easily admit that they consider budget impact and are even reluctant to explicitly use budget impact as a formal criterion. A debate would strengthen the theoretical foundation of budget impact as a legitimate criterion in the context of drug reimbursement decisions. Such discussion of budget impact's role will also enhance policy-makers' accountability.

Original languageEnglish
Pages (from-to)49-55
Number of pages7
JournalInternational Journal of Technology Assessment in Health Care
Volume25
Issue number1
DOIs
Publication statusPublished - Jan 2009
Externally publishedYes

Keywords

  • Budgets
  • Cost-Benefit Analysis
  • Decision Making
  • Health Care Reform
  • Health Policy
  • Health Resources
  • Humans
  • Insurance, Health, Reimbursement
  • Netherlands
  • Prescription Drugs
  • Resource Allocation

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