MPs have called for a "full-scale review" of how the government's NHS watchdog decides which drugs and treatments should be available to patients.

In their first report into the National Institute for Clinical Excellence, the Common's health committee called for the decision-making process to be made more transparent.

MPs also urged Nice to take greater account of the impact treatments have on patients' quality of life.

This is an important and positive report

Sir Michael Rawlins, Nice chairman

The institute has been criticised in the past by charities and patient groups, which have accused it of banning or limiting the use of some drugs because they would cost the NHS too much money.

MPs said there was "considerable confusion" on how the institute decides whether the health service can afford new treatments.

They called on ministers to publish "clear criteria" for deciding which treatments should be available to patients.

Faster decisions

They also suggested that Nice should assess new technologies and drugs faster so that guidelines are published as the treatments become available.

MPs added that ministers should clarify whether NHS organisations are legally obliged to follow Nice guidelines.

Overall, the cross-party committee was broadly supportive of the work being done by Nice.

Mr Hinchliffe called for changes to the way Nice works

They said the institute had come in for "unfair criticism" and called on the government to be more open about the rationing in the NHS.

David Hinchliffe, committee chairman, said: "The very existence of Nice is encouraging in that it represents a long-overdue attempt to place measured consideration of both clinical effectiveness and value for money at the heart of NHS decision-making."

But he added: "We have recommended that the government should work to achieve a comprehensive framework for healthcare prioritisation, underpinned by an explicit set of ethical and rational values, which will help people make these decisions in a more informed and consistent way."

Sandra Gidley, Liberal Democrat MP and a member of the health committee, said: "Nice must be clearer about how it takes decisions on the affordability of new treatments and the effect of that on the wider NHS."

Broad support

Professor Sir Michael Rawlins, chairman of Nice, welcomed the report.

"This is an important and positive report and we are pleased that the committee has recognised our challenging remit and the progress we have made so far," he said. "There is much to consider."

Charities also backed the report. Glynn McDonald, policy manager of the Multiple Sclerosis Society, said: "We are also pleased to see recommendations on greater transparency in the NICE decision-making process, reforms to its flawed appeal process, and the Committee's call for a more open debate on healthcare prioritisation."

Joanne Rule, chief executive of CancerBACUP, said: "The committee's recommendations on speeding up the publication of guidance on particular treatments will be good news for cancer patients.

"Too many people have had to live with uncertainty, not knowing whether the treatment they need will be funded by the NHS, while Nice makes up its mind."