If the Net Monetary Benefit is positive at a given threshold, what does it imply?

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Study for the WHEBP Evidence as it Relates to Cost Test. Use flashcards and multiple-choice questions, with explanations and hints. Prepare for your exam efficiently!

Multiple Choice

If the Net Monetary Benefit is positive at a given threshold, what does it imply?

Explanation:
Net Monetary Benefit combines health gains and costs into a single monetary value using the chosen willingness-to-pay per unit of health. If the incremental health effect is ΔEffect and the incremental cost is ΔCost, then NMB = (WTP × ΔEffect) − ΔCost. A positive NMB means the value of the health gains at that WTP exceeds the extra cost, so the new option is cost-effective at that threshold. Put differently, the ICER would be below the WTP threshold for the comparison, confirming cost-effectiveness. If NMB isn’t positive, the option isn’t cost-effective at that threshold.

Net Monetary Benefit combines health gains and costs into a single monetary value using the chosen willingness-to-pay per unit of health. If the incremental health effect is ΔEffect and the incremental cost is ΔCost, then NMB = (WTP × ΔEffect) − ΔCost. A positive NMB means the value of the health gains at that WTP exceeds the extra cost, so the new option is cost-effective at that threshold. Put differently, the ICER would be below the WTP threshold for the comparison, confirming cost-effectiveness. If NMB isn’t positive, the option isn’t cost-effective at that threshold.

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