Display Settings:

Format

Send to:

Choose Destination
We are sorry, but NCBI web applications do not support your browser and may not function properly. More information
Med Decis Making. 2000 Jul-Sep;20(3):332-42.

Willingness to pay for a quality-adjusted life year: in search of a standard.

Author information

  • 1Department of Health Management and Policy, University of Michigan School of Public Health, Ann Arbor 48109-2029, USA. rhirth@umich.edu

Abstract

Cost-benefit analysis (CBA) provides a clear decision rule: undertake an intervention if the monetary value of its benefits exceed its costs. However, due to a reluctance to characterize health benefits in monetary terms, users of cost-utility and cost-effectiveness analyses must rely on arbitrary standards (e.g., < $50,000 per QALY) to deem a program "cost-effective." Moreover, there is no consensus regarding the appropriate dollar value per QALY gained upon which to base resource allocation decisions. To address this, the authors determined the value of a QALY as implied by the value-of-life literature and compared this value with arbitrary thresholds for cost-effectiveness that have come into common use. A literature search identified 42 estimates of the value of life that were appropriate for inclusion. These estimates were classified by method: human capital (HK), contingent valuation (CV), revealed preference/job risk (RP-JR) and revealed preference/non-occupational safety (RP-S), and by U.S. or non-U.S. origin. After converting these value-of-life estimates to 1997 U.S. dollars, the life expectancy of the study population, age-specific QALY weights, and a 3% real discount rate were used to calculate the implied value of a QALY. An ordinary least-squares regression of the value of a QALY on study type and national origin explained 28.4% of the variance across studies. Most of the explained variance was attributable to study type; national origin did not significantly affect the values. Median values by study type were $24,777 (HK estimates), $93,402 (RP-S estimates), $161,305 (CV estimates), and $428,286 (RP-JR estimates). With the exception of HK, these far exceed the "rules of thumb" that are frequently used to determine whether an intervention produces an acceptable increase in health benefits in exchange for incremental expenditures.

PMID:
10929856
[PubMed - indexed for MEDLINE]
PubMed Commons home

PubMed Commons

0 comments
How to join PubMed Commons

    Supplemental Content

    Icon for HighWire
    Loading ...
    Write to the Help Desk