Back to economic fundamentals: a welfare-based accounting framework for societal value in health technology assessment

Practical adoption of “novel” value elements in value assessment remains uneven, in part because components are often defined inconsistently and may overlap. We develop a welfare-grounded accounting framework to organize societal value components and clarify when proposed elements represent distinct welfare changes versus alternative labels for the same effect. We draw on individual utility theory and social welfare functions to define a three-step accounting structure: specify primitive consequences for affected individuals, map those consequences into individual utility, and aggregate utilities into social welfare. Primitive consequences are organized as changes in health-related functioning/experience and consumption or other non-health resource consequences. We then use the structure to reinterpret commonly cited novel value elements and identify where overlap may arise. The framework locates proposed value elements at three levels. Level 1 expands the outcome space, including caregiver and relational spillovers, productivity, fear of contagion, value of knowing, and scientific spillovers. Level 2 concerns features of the utility mapping, including severity, outcome uncertainty, and value of hope through risk preferences or cross-domain dependence. Level 3 concerns aggregation choices in the social welfare function, including equity and intergenerational considerations. Relational spillovers, financing effects, and future-cohort effects are treated as channels through which the set of affected individuals may broaden, rather than as separate add-on values. A welfare-based accounting framework can organize societal value components, clarify where proposed elements enter, and make overlap explicit and auditable, thereby helping reduce double counting without treating novel elements as independent add-ons.