Functions & Formulae

Each applied formula has its own function page, with a signature, implementations, and tests.

Budget impact test of the first three years of net budget impact against the NICE threshold

v(BI_1, BI_2, BI_3, L) = (M, X, met)

Maps the net budget impact expected in each of the first three financial years of a technology's use in the NHS, and the threshold of the NICE budget impact test, to the peak annual figure, its margin over the threshold and whether the test is met. Each annual figure is a periodic budget impact of HE-FM-BIA-001, E_A_t minus E_R_t, which NICE estimates as the net annual cost to the NHS. The article's per-patient form, n_t times (p minus d minus h) plus K_t, is HE-FM-BIA-001 with the spending of each scenario costed as in HE-FM-COST-001, so it is not restated, and gross spend on the new technology, n_t times p, is HE-FM-COST-001 with one resource. The cumulative total over the forecast is HE-FM-BIA-002 and a present value of the annual series is HE-FM-DR-002; neither is the figure the test reads. Notation follows the Budget Impact article.

  • NICE budget impact test on the largest net budget impact of the first three financial years

    M = max(max(BI_1, BI_2), BI_3); X = M - L; met = (X > 0)

    Takes the net budget impact expected in each of the first three financial years of the technology's use in the NHS, each a periodic budget impact of HE-FM-BIA-001, picks the largest, M, and subtracts the threshold L, GBP 40 million a year since the June 2025 update to the NICE manual (PMG36). Sections 5.10.4, 5.10.5 and 5.10.21 state the condition as a net budget impact expected to exceed GBP 40 million a year in any of the first 3 financial years, and NICE's assessing resource impact process manual regards the threshold as exceeded when the figure is greater than GBP 40 million, so met equals 1 only when the peak is above L and a peak of exactly GBP 40 million does not meet the test. The comparison is year by year, so neither the cumulative total of HE-FM-BIA-002 nor any year after the third enters it. When the condition holds NHS England offers commercial discussions with the company before requesting a variation to the funding requirement (section 5.10.5), and guidance executive takes into account whether the test has been met when it decides whether to vary the timescale for the funding requirement (section 5.10.28).