Rationing in the NHS

Rationing of drugs is not new within the NHS and, as a feature of most healthcare systems, it is not exclusive to the NHS either. With finite resources, the provision of comprehensive, clinically appropriate treatment to everyone with a health need is not possible and, as such, difficult choices need to be made.

In England, this is the task of the National Institute for Health and Care Excellence (NICE). As the technologies that NICE considers already have a licence from the European Medicines Agency (EMA), NICE considers whether these technologies deliver value for money: is the benefit worth the cost, or could the money be better spent elsewhere in the healthcare system?NICE gathers the best available evidence and uses it alongside evidence from the drug companies, healthcare professionals, patients and other interested parties to facilitate the decision-making process – the health technology appraisal (HTA) process.

Decisions on cost-effectiveness can be made through the use of quality-adjusted life-years (QALYs): a means of measuring health gain from an intervention. Although widely debated, the QALY is a value-for-money measure of the benefit a treatment provides that allows it to be compared with the value for money offered by other treatments across different therapy areas.[1] NICE generally accepts those treatments with a cost per QALY of less than £20,000 as representing good value for the NHS. While it may also recommend some treatments with a cost per QALY of up to £30,000 and, for treatments used to extend life at the end of life, up to around £50,000, the chance of a treatment being recommended for use reduces as the cost per QALY increases.

Given the need to ensure the best use of finite healthcare resources, it is perhaps not surprising that the role of NICE is challenging (and challenged). Although widely debated and much criticised since its inception in 1999, the NICE framework is considered by many to represent one of the more sophisticated attempts to integrate HTA into the decision-making process.[2] The ability of NICE to make decisions is, however, frequently called into question; its judgements frequent fliers in the newspaper headlines: ‘Doctors’ despair as NICE rejects another breast cancer drug that can extend life: Treatment is eighth to be turned down by watchdog in three years.’[3]

Short of making all effective therapy available, there does need to be some mechanism in place to decide on healthcare priorities. If a drug costs too much for too little benefit, the NHS must be able to deny it to patients. If not, the market will push drug prices higher with possible knock-on implications for the provision of healthcare in the wider system. Ultimately, though, no matter what the decision-making framework, these decisions will always be subject to controversy. We can not get away from the fact that, where budgets are finite, there will always be an opportunity cost, where the provision of the drug to one person can mean that someone elsewhere in the healthcare system may be denied access to the care that they need.

‘The Price of Life’, a 2009 BBC documentary by Adam Wishart looks at the rationing process in the UK from the points of view of various key stakeholders. It is available to view here and I highly recommend watching it. More recently, the Channel 4 documentary ‘NHS: £2 Billion Per Week and Counting’ looked at the factors that make it harder than ever for the NHS to decide how to allocate funds.

Purchase the following titles from our webshop: What is a QALY?, What is Health Technology Assessment?, What are the HTA Processes in the UK?, What is cost-effectiveness?


[1] Pietersma S, van den Akker-van Marle E, de Vries M. Generic quality of life utility measures in health-care research: conceptual issues highlighted for the most commonly used utility measures. International Journal of Wellbeing 2013; 3: 173–181.

[2] Drummond M, Sorrenson C. Nasty or Nice? A perspective on the use of health technology assessment in the United Kingdom. Value Health 2009; 12(Suppl 2): S8–S13.

[3] www.dailymail.co.uk/health/article-2719485/Doctors-despair-NICE-rejects-breast-cancer-drug-extend-life-Treatment-eighth-turned-watchdog-three-years.html (last accessed 4 April 2015)