Concept Architecture
Concept
Theoretically, Proportional Shortfall is an equity-based measure used to quantify the proportion of an individual's remaining expected healthy life that is lost because of a disease or health condition. It is founded on distributive justice and lifetime health equity principles and provides a measure of disease severity relative to the individual's remaining health expectancy. In health economics, proportional shortfall is used as a severity criterion in health technology assessment to prioritise interventions for patients facing greater losses in lifetime health.
Mathematically, Proportional Shortfall is represented as the ratio of health lost due to a condition to the expected remaining healthy life in the absence of that condition. The measure is bounded between 0 and 1, where larger values indicate more severe health loss relative to expected future health.
In practice, Proportional Shortfall is estimated using life expectancy and quality-adjusted life expectancy derived from epidemiological data, disease models and health-related quality-of-life estimates. It has been adopted by several health technology assessment agencies, including the Dutch National Health Care Institute (Zorginstituut Nederland), as part of decision frameworks that incorporate disease severity alongside cost-effectiveness.
Purpose
Used to quantify the severity of disease by measuring the proportion of expected remaining healthy life that is lost because of a health condition and to inform priority setting in health technology assessment.
Mathematical Formulae
Primary Formula
Proportional Shortfall = (QALE?healthy? ? QALE?disease?) / QALE?healthy?
where:
- QALE?healthy? = expected remaining quality-adjusted life expectancy without the disease
- QALE?disease? = expected remaining quality-adjusted life expectancy with the disease
Supporting Formulae
Absolute Shortfall:
Absolute Shortfall = QALE?healthy? ? QALE?disease?
Relationship:
Proportional Shortfall = Absolute Shortfall / QALE?healthy?
Related Mathematical Methods
- Quality-Adjusted Life Expectancy
- Absolute Shortfall
- Severity Adjustment
- Equity Weighting
- Distributional Cost-Effectiveness Analysis
Example
Patients without a disease are expected to have 18 remaining quality-adjusted life years, whereas patients with the disease are expected to have 6 remaining quality-adjusted life years.
Proportional Shortfall = (18 ? 6) / 18 = 12 / 18 = 0.667
The disease results in a proportional shortfall of 0.667, indicating that patients lose approximately 67% of their remaining expected healthy life because of the condition.
Excel Implementation
| Function | Example Formula | Health Economics Application |
|---|---|---|
| Arithmetic | =(B2-C2)/B2 | Calculates proportional shortfall from healthy and disease-specific QALE |
| IF | =IF(D2>=0.70,""Very high severity"",""Lower severity"") | Classifies disease severity using predefined thresholds |
| AVERAGE | =AVERAGE(D2:D100) | Summarises proportional shortfall across patient groups |
| ROUND | =ROUND(D2,3) | Formats proportional shortfall for reporting |
VBA (Optional)
Automate proportional shortfall calculations for multiple disease populations and generate severity classifications for health technology assessment.
Sources
- Stolk EA, van Donselaar G, Brouwer WBF, Busschbach JJV. Reconciliation of economic concerns and health policy: illustration of the proportional shortfall approach. Health Economics. 2004.
- Stolk EA, Brouwer WBF, Busschbach JJV. Rationalising rationing: economic and other considerations in the debate about funding of expensive treatments. Pharmacoeconomics.
- Zorginstituut Nederland. Package Advice Methodology and Severity of Illness Guidance.
- Drummond MF, Sculpher MJ, Claxton K, Stoddart GL, Torrance GW. Methods for the Economic Evaluation of Health Care Programmes. Oxford University Press.
Related Concepts (2)
Library
Publications
1
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 →
Frequently Asked Questions (6)
What is proportional shortfall?
A measure of disease severity calculated as the proportion, rather than absolute number, of expected quality-adjusted life years lost to a condition.
Source: Nord & Johansen 2014
How is proportional 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, taken from life tables combined with population norms for quality of life. The second is the quality-adjusted life expectancy of patients with the condition under current management. The difference between them is divided by the first, giving the proportion of remaining healthy life the condition removes, expressed between zero and one. Because both quantities are modelled rather than observed, the resulting proportion inherits the uncertainty in the survival and quality of life assumptions used.
Source: Nord & Johansen 2014
How does proportional shortfall differ from absolute shortfall?
Absolute shortfall measures the quantity of health lost in quality-adjusted life years, so a condition removing many years produces a large figure regardless of the age at which it strikes. Proportional shortfall measures the same loss as a share of what remained, so a condition removing most of a short remaining lifetime scores highly even though the absolute quantity is small. The two therefore rank conditions differently, with the proportional measure giving more weight to severe conditions in later life. Frameworks applying both measures and taking whichever is more favourable avoid having to choose between the two accounts of what severity means.
Source: NICE 2022
What is proportional shortfall used for?
It is used as a measure of disease severity when deciding whether a treatment should attract greater weight in appraisal, so that a given health gain counts for more where the untreated condition is severe. Where a threshold applies to the ratio of cost to health gained, qualifying for a severity weight allows a higher cost per unit of health than would otherwise be accepted. The measure replaced earlier arrangements that gave special consideration to end-of-life treatments. The shortfall is calculated for the population as modelled rather than for individual patients, so a heterogeneous condition receives a single figure that describes none of its subgroups exactly.
Source: NICE 2022
Why is proportional shortfall favoured by some over absolute shortfall?
Because it does not systematically advantage younger patients, who by construction have more remaining life to lose and therefore generate larger absolute figures. Expressing the loss as a proportion treats a condition removing most of an older person's remaining life as severe, which many regard as closer to how severity is ordinarily understood. Frameworks using both and applying whichever is more favourable avoid choosing between the two arguments. The argument is not settled, since the absolute measure can equally be defended on the ground that losing more years is worse than losing fewer.
Source: Nord & Johansen 2014
What criticisms are made of proportional shortfall?
It depends on modelled quality-adjusted life expectancy under current management, so a measure intended to capture severity partly reflects modelling assumptions and the quality of life values used. The general population comparator embeds existing inequalities in life expectancy, since the reference differs by age and sex but not by other characteristics that affect how long people actually live. And severity is only one of several considerations that might justify departing from a uniform threshold, so weighting it explicitly gives it precedence over others left unweighted. A further objection is that severity weighting shifts resources towards conditions that are severe rather than towards interventions that are effective, which are different criteria.
Source: Nord & Johansen 2014
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Verified by Dr Darrin Baines
British health economist
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Verification date: 11 Aug 2025
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