Off-policy evaluation (OPE) estimates the value of a contextual bandit policy prior to deployment. As such, OPE plays a critical role in ensuring safety in high-stakes domains such as healthcare. However, standard OPE approaches are limited by the size and coverage of the behavior dataset. While previous work has explored using expert-labeled counterfactual annotations to enhance dataset coverage, obtaining such annotations is expensive, limiting the scalability of prior approaches. We propose leveraging large language models (LLMs) to generate counterfactual annotations for OPE in medical domains. Our method uses domain knowledge to guide LLMs in predicting how key clinical features evolve under alternate treatments. These predicted features can then be transformed using known reward functions to create counterfactual annotations. We first evaluate the ability of several LLMs to predict clinical features across two patient subsets in MIMIC-IV, finding that state-of-the-art LLMs achieve comparable performance. Building on this capacity to predict clinical features, we generate LLM-based counterfactual annotations and incorporate them into an OPE estimator. Our empirical results analyze the benefits of counterfactual annotations under varying degrees of shift between the behavior and target policies. We find that in most cases, the LLM-based counterfactual annotations significantly improve OPE estimates up to a point. We provide an entropy-based metric to identify when additional annotations cease to be useful. Our results demonstrate that LLM-based counterfactual annotations offer a scalable approach for addressing coverage limitations in healthcare datasets, enabling safer deployment of decision-making policies in clinical settings.

For example, in healthcare domains, such annotations may be obtained by asking clinicians what they think would happen to the patient if a different treatment were to be used.

Off-policy evaluation (OPE) provides safety guarantees by estimating the performance of a policy before deployment. Recent work introduced IS+, an importance sampling (IS) estimator that uses expert-annotated counterfactual samples to improve behavior dataset coverage. However, IS estimators are known to have high variance; furthermore, the performance of IS+ deteriorates when annotations are imperfect. In this work, we propose a family of OPE estimators inspired by the doubly robust (DR) principle. A DR estimator combines IS with a reward model estimate, known as the direct method (DM), and offers favorable statistical guarantees. We propose three strategies for incorporating counterfactual annotations into a DR-inspired estimator and analyze their properties under various realistic settings. We prove that using imperfect annotations in the DM part of the estimator best leverages the annotations, as opposed to using them in the IS part. To support our theoretical findings, we evaluate the proposed estimators in three contextual bandit environments. Our empirical results show that when the reward model is misspecified and the annotations are imperfect, it is most beneficial to use the annotations only in the DM portion of a DR estimator. Based on these theoretical and empirical insights, we provide a practical guide for using counterfactual annotations in different realistic settings.