Model parameter estimation and uncertainty: a report of the ISPOR-SMDM modeling good research practices task force-6

Briggs, A.H. , Weinstein, M.C., Fenwick, E.A.L., Karnon, J., Sculpher, M.J. and Paltiel, A.D. (2012) Model parameter estimation and uncertainty: a report of the ISPOR-SMDM modeling good research practices task force-6. Value in Health, 15(6), pp. 835-842. (doi:10.1016/j.jval.2012.04.014)

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Abstract

A model's purpose is to inform medical decisions and health care resource allocation. Modelers employ quantitative methods to structure the clinical, epidemiological, and economic evidence base and gain qualitative insight to assist decision makers in making better decisions. From a policy perspective, the value of a model-based analysis lies not simply in its ability to generate a precise point estimate for a specific outcome but also in the systematic examination and responsible reporting of uncertainty surrounding this outcome and the ultimate decision being addressed. Different concepts relating to uncertainty in decision modeling are explored. Stochastic (first-order) uncertainty is distinguished from both parameter (second-order) uncertainty and from heterogeneity, with structural uncertainty relating to the model itself forming another level of uncertainty to consider. The article argues that the estimation of point estimates and uncertainty in parameters is part of a single process and explores the link between parameter uncertainty through to decision uncertainty and the relationship to value of information analysis. The article also makes extensive recommendations around the reporting of uncertainty, in terms of both deterministic sensitivity analysis techniques and probabilistic methods. Expected value of perfect information is argued to be the most appropriate presentational technique, alongside cost-effectiveness acceptability curves, for representing decision uncertainty from probabilistic analysis.

Item Type:Articles
Status:Published
Refereed:Yes
Glasgow Author(s) Enlighten ID:Briggs, Professor Andrew and Fenwick, Professor Elisabeth
Authors: Briggs, A.H., Weinstein, M.C., Fenwick, E.A.L., Karnon, J., Sculpher, M.J., and Paltiel, A.D.
College/School:College of Medical Veterinary and Life Sciences > Institute of Health and Wellbeing > Health Economics and Health Technology Assessment
Journal Name:Value in Health
Publisher:Blackwell
ISSN:1098-3015
ISSN (Online):1524-4733
Published Online:18 September 2012

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