Medical Decision Making

 

Advanced Search

Journal Navigation

Journal Home

Subscriptions

Archive

Contact Us

Table of Contents

Register here to gain access to SAGE's 500+ Journals Online

SAGETRACK

Sign In to gain access to subscriptions and/or personal tools.
This Article
Right arrow Full Text (PDF)
Right arrow All Versions of this Article:
0272989X07312477v1
28/3/300    most recent
Right arrow References
Right arrow Alert me when this article is cited
Right arrow Alert me if a correction is posted
Services
Right arrow Email this article to a friend
Right arrow Similar articles in this journal
Right arrow Similar articles in ISI Web of Science
Right arrow Similar articles in PubMed
Right arrow Alert me to new issues of the journal
Right arrow Add to Saved Citations
Right arrow Download to citation manager
Right arrowRequest Permissions
Right arrow Request Reprints
Right arrow Add to My Marked Citations
Google Scholar
Right arrow Articles by Eckermann, S.
Right arrow Articles by Willan, A. R.
PubMed
Right arrow PubMed Citation
Right arrow Articles by Eckermann, S.
Right arrow Articles by Willan, A. R.
Social Bookmarking
Add to CiteULike   Add to Connotea   Add to Del.icio.us   Add to Digg   Add to Reddit   Add to Technorati  
What's this?
This version was published on June 1, 2008
Medical Decision Making, Vol. 28, No. 3, 300-305 (2008)
DOI: 10.1177/0272989X07312477

The Option Value of Delay in Health Technology Assessment

Simon Eckermann, PhD

Flinders University Centre for Clinical Change and Health Care Research, Adelaide, Australia, simon.eckermann{at}flinders.edu.au

Andrew R. Willan, PhD

Sick-Kids Research Institute and University of Toronto, Toronto, Ontario

Processes of health technology assessment (HTA) inform decisions under uncertainty about whether to invest in new technologies based on evidence of incremental effects, incremental cost, and incremental net benefit monetary (INMB). An option value to delaying such decisions to wait for further evidence is suggested in the usual case of interest, in which the prior distribution of INMB is positive but uncertain. Methods of estimating the option value of delaying decisions to invest have previously been developed when investments are irreversible with an uncertain payoff over time and information is assumed fixed. However, in HTA decision uncertainty relates to information (evidence) on the distribution of INMB. This article demonstrates that the option value of delaying decisions to allow collection of further evidence can be estimated as the expected value of sample of information (EVSI). For irreversible decisions, delay and trial (DT) is demonstrated to be preferred to adopt and no trial (AN) when the EVSI exceeds expected costs of information, including expected opportunity costs of not treating patients with the new therapy. For reversible decisions, adopt and trial (AT) becomes a potentially optimal strategy, but costs of reversal are shown to reduce the EVSI of this strategy due to both a lower probability of reversal being optimal and lower payoffs when reversal is optimal. Hence, decision makers are generally shown to face joint research and reimbursement decisions (AN, DT and AT), with the optimal choice dependent on costs of reversal as well as opportunity costs of delay and the distribution of prior INMB.

Key Words: value of information • decision theory • option value of delay • cost of reversal.


Add to CiteULike CiteULike   Add to Connotea Connotea   Add to Del.icio.us Del.icio.us   Add to Digg Digg   Add to Reddit Reddit   Add to Technorati Technorati    What's this?