Toward a Broader Concept of Value: Identifying and Defining Elements for an Expanded Cost-Effectiveness Analysis

This commentary identifies and defines potentially useful expansions to traditional cost-effectiveness analysis as often used in health technology assessment. Since the seminal 1977 article by Weinstein and Stason, the recommended approach has been the use of the incremental costeffectiveness ratio based on the metric of the cost per quality-adjusted life-year gained, allowing comparisons across different technologies. An expanded framework, incorporating a wider range of the elements of value, is proposed. In addition to the core value drivers of health gain and other health system cost savings (if any), we propose adding other less recognized elements related to the value of knowing and informational externalities. We describe each of five factors related to the value of knowing: 1) a reduction in uncertainty, reflecting the benefit of a companion diagnostic increasing the certainty of a patient's response to a medicine; 2) insurance value related to greater peace of mind due to protection against catastrophic health and financial loss; 3) the value of hope for a cure, leading individuals to become risk seekers in some circumstances; 4) real option value due to life extension opening possibilities for individuals to benefit from future innovation; and 5) spillovers or externalities arising from benefits of scientific advances that cannot be entirely appropriated by those making the advances. Further thought and research are needed on how best to measure and integrate these elements into an incremental value framework and on coverage and pricing decisions.