A decision threshold is a value that dichotomizes the result of a quantitative test to a simple binary decision.
The test result of a quantitative diagnostic test is dichotomized by treating the values above or equal to a threshold as positive, and those below as negative, or vice-versa.
There are many ways to choose a decision threshold for a diagnostic test. For a simple screening test, the decision threshold is often chosen to incur a fixed, true positive, or false positive rate. In more complex cases, the optimal decision threshold depends on both the cost of performing the test and the cost of the consequences of the test result. The costs may include both financial and health-related costs. A simple formula to determine the optimal decision threshold (Zweig & Campbell, 1993) maximizes: Sensitivity - m * (1- Specificity) where m = (Cost FP - Cost TN) / (Cost FN - Cost TP).
