In 2022, Indonesia updated its Health Technology Assessment (HTA) guidelines by introducing a framework that includes cost-effectiveness thresholds (CETs) set at 1 to 3 times the GDP per capita. However, these GDP-based thresholds were initially intended for use in benefit–cost analyses to guide resource allocation across sectors—not as fixed CETs for healthcare decisions. Their divergence from healthcare budgets, technical capacity, societal preferences, and values underscores the need for caution in relying solely on them for decision-making. Therefore, it is crucial to develop CETs that are more closely aligned with Indonesia’s specific context and needs.

To address this, a project supported by WHO and the Ministry of Health began in 2023 to explore the development of CETs using two perspectives: the demand-side, and the supply-side—which accounts for opportunity costs and government budget limitations.

CHEPS UI, working with the Ministry of Health and supported by WHO Indonesia, is leading efforts to generate policy recommendations for supply-side CETs. Using current methodological approaches, the study estimates the health system’s marginal productivity in three stages: first, by calculating the elasticity of health spending on mortality reduction; second, by assessing the health opportunity costs of healthcare spending; and third, by determining a cost-effectiveness threshold for the cost per Disability-Adjusted Life Year (DALY) averted, based on the inverse of the marginal product of health spending.