Cost-Effectiveness Thresholds: Overvaluing Innovation, Undervaluing Health

Standard cost-effectiveness thresholds used in the US and other high-income countries already exceed the marginal cost of a unit of health, building in an “innovation premium” that allows new drugs to be deemed cost-effective even when adopting them produces a net population health loss. Rather than abandoning thresholds, policymakers should fund research to identify the true opportunity-cost threshold, use it as a primary result in analyses, and acknowledge this premium for “newness” as a deliberate policy choice rather than a hidden default.