Functions & Formulae

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

Incremental utility-cost function as the inverse of an incremental cost-utility ratio

g(Delta_Q,Delta_C) = IUCR

Maps the incremental QALYs and the incremental cost of an intervention against one comparator to the QALYs gained per one million units of net expenditure, the form New Zealand's PHARMAC prefers to the cost per QALY. The incremental cost-utility ratio itself, ICUR = Delta_C / Delta_QALY, is HE-FM-CUA-001 and the general two-option ratio is HE-FM-ICER-001. Checks against a threshold use the incremental net monetary benefit HE-FM-NMB-002 or the incremental net health benefit HE-FM-CET-002. Notation follows the Incremental Cost-Utility Ratio article, which writes the QALY difference as Delta_Q.

  • Incremental utility-cost ratio in QALYs gained per one million of net expenditure

    IUCR = Delta_Q / Delta_C * 1000000

    Divides the incremental QALYs by the incremental cost, both taken as the intervention minus the comparator and both discounted, and multiplies by one million. PHARMAC calls the result the incremental utility-cost ratio (IUCR) and describes the incremental cost per QALY as in effect its inverse, so 1,000,000 divided by the IUCR returns the ICUR of HE-FM-CUA-001. For a QALY gain at extra cost a higher IUCR indicates better value, the opposite direction to the ICUR.