Concept Architecture
Concept
Theoretically, Absolute Shortfall is a measure of disease severity that quantifies the total amount of future health expected to be lost because of a disease compared with individuals of the same age in full health. It is based on health opportunity and equity principles, recognising that individuals with more severe illness lose a greater quantity of expected healthy life. The concept is used in health technology assessment to incorporate disease severity into reimbursement and priority-setting decisions.
Mathematically, Absolute Shortfall is represented as the difference between the expected remaining lifetime health of a healthy individual and the expected remaining lifetime health of an individual with the condition. It estimates the absolute quantity of future health lost, typically expressed in quality-adjusted life years (QALYs).
In practice, Absolute Shortfall is estimated using life expectancy and quality-adjusted survival data derived from clinical evidence, epidemiological studies and decision-analytic models. It is used by health technology assessment agencies, including NICE, to assess disease severity when evaluating healthcare interventions.
Purpose
Used to quantify disease severity, assess lifetime health loss, inform health technology assessment, support reimbursement decisions, and incorporate severity into healthcare resource allocation.
Mathematical Formulae
Primary Formula
AS = QALY?Healthy? ? QALY?Disease?
Where:
- AS = Absolute Shortfall
- QALY?Healthy? = Expected remaining lifetime QALYs for a healthy individual of the same age
- QALY?Disease? = Expected remaining lifetime QALYs for an individual with the disease under current standard care
Supporting Formulae
None.
Related Mathematical Methods
- Quality-Adjusted Life Year (QALY)
- Survival Analysis
- Decision-Analytic Modelling
- Health Technology Assessment
- Severity Assessment
Example
A healthy 55-year-old is expected to experience 18.5 remaining QALYs.
A patient of the same age with an advanced neurological disease is expected to experience 6.8 remaining QALYs under current care.
AS = 18.5 ? 6.8 = 11.7 QALYs
The disease therefore has an Absolute Shortfall of 11.7 QALYs.
Excel Implementation
| Function | Example Formula | Health Economics Application |
|---|---|---|
| Subtraction | =B2-B3 | Calculate Absolute Shortfall. |
| SUM | =SUM(B2:B21) | Calculate expected lifetime QALYs from annual QALY estimates. |
| ROUND | =ROUND(B2-B3,2) | Report Absolute Shortfall for health technology assessment submissions. |
VBA (Optional)
Automate the calculation of Absolute Shortfall across multiple patient populations using modelled lifetime QALY estimates.
Sources
- NICE. Health Technology Evaluation Manual.
- NICE. Severity Modifiers. Methods documentation.
- Drummond MF, Sculpher MJ, Claxton K, Stoddart GL, Torrance GW. Methods for the Economic Evaluation of Health Care Programmes. Oxford University Press.
- Stolk EA, van Donselaar G, Brouwer WBF, Busschbach JJV. Methodological foundations of burden of disease and severity measures used in health technology assessment.
Related Concepts (5)
Library
Publications
2
Methods for the Economic Evaluation of Health Care Programmes — Drummond, Sculpher, Claxton, Stoddart & Torrance, 4th Edition ed., 2015 (Oxford University Press)
The standard international reference text for economic evaluation methods in health care, covering cost-effectiveness, cost-utility and cost-benefit analysis, measurement of costs and outcomes, evidence synthesis, and the characterisation of uncertainty.
BookView source →NICE Health Technology Evaluations: The Manual (PMG36) — National Institute for Health and Care Excellence, PMG36 ed., 2022 (NICE)
NICE’s consolidated methods and processes manual for health technology evaluation, defining the reference case for economic evaluation (perspective, comparators, time horizon, discounting, EQ-5D, cost-effectiveness thresholds and the severity modifier) — the authoritative HTA methods reference for the English NHS.
Frequently Asked Questions (6)
What is absolute shortfall?
A measure of disease severity calculated as the difference between the quality-adjusted life expectancy of a healthy comparator population and that of untreated patients.
Source: NICE 2022
How is absolute shortfall calculated?
Two quantities are required. The first is the quality-adjusted life expectancy remaining to a general population of the same age and sex as the patients concerned, taken from population life tables combined with population norms for health related quality of life. The second is the quality-adjusted life expectancy of those patients under current management without the treatment under appraisal, taken from the economic model. The difference between them is the absolute shortfall, expressed in quality-adjusted life years, and it captures how much of a normal lifetime's health the condition removes.
Source: NICE 2022
How does absolute shortfall differ from proportional shortfall?
Absolute shortfall measures the quantity of health lost, so a condition removing many quality-adjusted life years produces a large figure regardless of the age at which it strikes. Proportional shortfall measures the same loss as a share of what the comparable population would have expected, so a condition removing most of a short remaining lifetime produces a large figure even though the absolute quantity is small. The two therefore rank conditions differently, with the absolute measure favouring conditions affecting younger people and the proportional measure giving more weight to severe conditions in later life.
Source: NICE 2022
What is absolute shortfall used for?
It is used to determine whether a treatment qualifies for greater weight in appraisal on grounds of the severity of the condition it treats, so that a given health gain counts for more where the untreated condition is severe. Where a threshold is applied to the ratio of cost to health gained, qualifying for a severity weight has the effect of allowing a higher cost per unit of health gained than would otherwise be accepted. The measure replaced earlier arrangements that gave special consideration to treatments extending life at the end of life, and applies across conditions rather than only to that group.
Source: NICE 2022
How are severity weights applied to absolute shortfall?
Shortfall is assessed on both the absolute and the proportional measure, each divided into bands, and the band reached determines the multiplier applied to the health gain. Where the two measures place a condition in different bands, the more favourable applies, so a treatment need satisfy only one of them. Because the calculation depends on the modelled outcomes under current management, the shortfall is not a fixed property of a disease and can differ between appraisals of the same condition where the comparator or the modelled population differs.
Source: NICE 2022
What criticisms are made of absolute shortfall?
The dependence on modelled quality-adjusted life expectancy means the result is sensitive to assumptions about the natural history of the condition and to the quality of life values used, so a measure intended to capture severity partly reflects modelling choices. Using a general population comparator also embeds existing inequalities in life expectancy into the calculation, since the reference point differs by age and sex but not by other characteristics that affect how long people actually live. A further objection is that severity is only one of several considerations that might justify departing from a uniform threshold, and weighting it explicitly gives it precedence over others that remain unweighted.
Source: healtheconomics.wiki
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Verified by Dr Darrin Baines
British health economist
Professional identity: darrinbaines.org
Verification date: 11 Aug 2025
Content version: 1.0.0
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