Concept Architecture
Concept
Theoretically, Multi-Criteria Decision Analysis (MCDA) is a structured decision-making framework that evaluates alternatives against multiple explicit criteria rather than relying on a single outcome measure. It provides a systematic approach for integrating evidence, stakeholder preferences and value judgements into complex decisions involving competing objectives. MCDA is founded on decision theory, multi-attribute value theory and utility theory, and exists to improve the transparency, consistency and reproducibility of decisions where multiple dimensions of value must be considered simultaneously.
Mathematically, MCDA represents the overall value of an alternative as the aggregation of criterion-specific performance scores weighted according to their relative importance. The most widely recognised mathematical representation is the weighted additive value model, although multiplicative models, outranking methods and pairwise comparison approaches are also employed depending on the decision context. The resulting composite value score provides a quantitative basis for ranking or selecting competing alternatives.
In practice, MCDA is implemented by defining decision criteria, eliciting criterion weights from stakeholders, measuring the performance of each alternative on each criterion and calculating an overall value score using an established aggregation method. MCDA is applied across health technology assessment, healthcare resource allocation, procurement, public health prioritisation and strategic healthcare planning to support transparent evidence-based decision-making.
Purpose
Used to compare competing alternatives across multiple decision criteria, integrate stakeholder preferences with quantitative evidence, support transparent resource allocation and improve consistency in healthcare, policy and health technology assessment decisions.
Mathematical Formulae
Primary Formula
V(a) = ?(w? ? s?(a))
where:
- V(a) = overall value score for alternative a
- w? = weight assigned to criterion i
- s?(a) = performance score of alternative a on criterion i
Supporting Formulae
?w? = 1
Normalised Score = (x ? min) � (max ? min)
Related Mathematical Methods
- Multi-Attribute Value Theory (MAVT)
- Multi-Attribute Utility Theory (MAUT)
- Weighted additive model
- Analytic Hierarchy Process (AHP)
- Swing weighting
- Direct rating
- ELECTRE
- PROMETHEE
- Preference elicitation
Example
A healthcare organisation evaluates three screening programmes using four criteria: effectiveness, cost, equity and feasibility.
| Criterion | Weight | Programme A Score |
|---|---|---|
| Effectiveness | 0.40 | 88 |
| Cost | 0.25 | 72 |
| Equity | 0.20 | 85 |
| Feasibility | 0.15 | 90 |
Overall value:
V(A) = (0.40 ? 88) + (0.25 ? 72) + (0.20 ? 85) + (0.15 ? 90)
= 35.2 + 18.0 + 17.0 + 13.5
= 83.7
Programme A therefore receives an overall MCDA value score of 83.7, allowing direct comparison with alternative programmes.
Excel Implementation
| Function | Example Formula | Health Economics Application |
|---|---|---|
| SUMPRODUCT | =SUMPRODUCT(B2:B5,C2:C5) | Calculate the weighted overall MCDA score. |
| SUM | =SUM(B2:B5) | Verify that criterion weights sum to one. |
| MIN | =MIN(C2:C20) | Determine the minimum score for normalisation. |
| MAX | =MAX(C2:C20) | Determine the maximum score for normalisation. |
| IF | =IF(SUM(B2:B5)=1,"Valid","Check Weights") | Validate the weighting structure before analysis. |
VBA (Optional)
Automate the calculation of weighted scores, validation of criterion weights, ranking of alternatives and generation of MCDA decision reports.
Sources
- Keeney RL, Raiffa H. Decisions with Multiple Objectives: Preferences and Value Trade-Offs. Cambridge University Press.
- Belton V, Stewart TJ. Multiple Criteria Decision Analysis: An Integrated Approach. Springer.
- Marsh K, IJzerman M, Thokala P, et al. Multiple Criteria Decision Analysis for Health Care Decision Making. Value in Health.
- ISPOR MCDA Emerging Good Practices Task Force Reports.
- Briggs A, Claxton K, Sculpher M. Decision Modelling for Health Economic Evaluation.
- Drummond MF, Sculpher MJ, Claxton K, Stoddart GL, Torrance GW. Methods for the Economic Evaluation of Health Care Programmes.
Related Concepts (2)
Library
Publications
3
Systematic Review on the Evaluation Criteria of Orphan Medicines in Central and Eastern European Countries — Zelei, Molnar, Szegedi & Kalo, Vol. 11 ed., 2016 (Orphanet Journal of Rare Diseases)
A systematic review of how orphan (rare-disease) medicines are evaluated for reimbursement, highlighting the limitations of standard HTA and cost-effectiveness analysis when clinical and economic evidence is scarce, and the role of equity and MCDA.
Journal ArticleView source →Defining Elements of Value in Health Care — A Health Economics Approach: An ISPOR Special Task Force Report [3] — Lakdawalla, Doshi, Garrison, Phelps, Basu & Danzon, Special Task Force Report 3 ed., 2018 (Value in Health)
The "ISPOR Value Flower" paper defining twelve potential elements of value in health care beyond the conventional QALY and net cost — including insurance value, value of hope, real option value, equity and scientific spillovers — to broaden value assessment of medical technologies.
Journal ArticleView source →ICER Value Assessment Framework (2023 Update) — Institute for Clinical and Economic Review, 2023 Update ed., 2023 (Institute for Clinical and Economic Review (ICER))
ICER’s framework describing its philosophy and methodology for assessing the value of medical interventions in the US — long-term cost-effectiveness, other benefits and contextual considerations, short-term budget impact, and adaptations for ultra-rare diseases and single/short-term therapies — the leading US value-assessment approach.
Frequently Asked Questions (6)
What is multi-criteria decision analysis?
Multi-criteria decision analysis is a structured framework evaluating options across multiple criteria simultaneously, assigning explicit weights and combining them into an overall score. It scores options across weighted criteria. Described in decision analysis, multi-criteria decision analysis weights criteria and combines them into a score. So multi-criteria decision analysis is a structured framework that evaluates options across multiple criteria at once, assigns explicit weights to the criteria, and combines them into an overall score for each option.
Source: Thokala et al. 2016
What structured framework is multi-criteria decision analysis?
Multi-criteria decision analysis is a structured framework for evaluating options across several criteria at once. It works by scoring each option on every criterion, assigning explicit weights to reflect the relative importance of each, and combining these into an overall score. It assigns those weights openly, so the judgement about what matters most is stated rather than hidden. It produces a single overall score for each option, allowing them to be ranked on a transparent basis. Applied within assessment, it becomes MCDA in HTA, weighing benefit, cost, and equity together. A method for weighing options on many criteria is what it names. Thokala and colleagues (2016) set this out.
Source: Thokala et al. 2016
How does multi-criteria decision analysis work?
Multi-criteria decision analysis works by evaluating options across multiple criteria simultaneously, assigning explicit weights to the criteria, and combining them into an overall score, so each option is scored across the weighted criteria. So multi-criteria decision analysis works by weighting criteria and combining scores, which is why it is structured, since it combines them formally, and multi-criteria decision analysis evaluates options across multiple criteria, assigns explicit weights, and combines them into an overall score.
Source: Thokala et al. 2016
What does multi-criteria decision analysis assign?
Multi-criteria decision analysis assigns explicit weights to the multiple criteria, so each criterion is given a weight reflecting its importance, and the weighted criteria are combined into an overall score. So multi-criteria decision analysis assigns explicit weights, which is why it is structured, since the weights combine into a score, and multi-criteria decision analysis assigns explicit weights to the criteria and combines them into an overall score.
Source: Thokala et al. 2016
What does multi-criteria decision analysis produce?
Multi-criteria decision analysis produces an overall score for each option, so by weighting the criteria and combining them it yields a single score reflecting how each option performs across all the criteria. So multi-criteria decision analysis produces an overall score, which is why it combines the weighted criteria, since the score summarises them, and multi-criteria decision analysis produces an overall score for each option from the weighted criteria.
Source: Thokala et al. 2016
How does multi-criteria decision analysis relate to MCDA in HTA?
Multi-criteria decision analysis relates to MCDA in HTA in that the latter applies the former: multi-criteria decision analysis is the structured framework weighting criteria into a score, and MCDA in HTA is its application within an assessment to weigh factors such as benefit, cost, and equity. So MCDA in HTA applies multi-criteria decision analysis, which is why they are connected, since one is the method and the other its use, and multi-criteria decision analysis is the framework that MCDA in HTA applies within the assessment process.
Source: Thokala et al. 2016
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Verified by Dr Darrin Baines
British health economist
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Verification date: 10 Feb 2026
Content version: 1.0.0
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