Trying to estimate a monetary value for the QALY

Searchers vs surveyors in estimating the monetary value of a QALY: resolving a nasty dilemma for NICE

Recently, for many health economics researchers, empirical estimation of the monetary valuation of a quality-adjusted life year (QALY) has become an important endeavour. Different philosophical and practical approaches to this have emerged. On the one hand, there is a view that, with health-care budgets set centrally, decision-making bodies within the system can iterate, from observation of a series of previous decisions, towards the value of a QALY, thus searching for such a value. Alternatively, and more consistent with the approach taken in other public sectors, individual members of the public are surveyed with the aim of directly eliciting a preference-based - also known as a willingness-to-pay-based (WTP-based) - value of a QALY. While the former is based on supply-side factors and the latter on demand, both in fact suffer from informational deficiencies. Sole reliance on either would necessitate an acceptance or accommodation of chronic inefficiencies in health-care resource allocation. On the basis of this observation, this paper makes the case that in order to approach optimal decision making in health-care provision, a framework incorporating and thus, to a degree, reconciling these two approaches is to be preferred.

The monetary value of a life year: evidence from a qualitative study of treatment costs

A small number of studies have provided suggestive evidence that the general public rejects the idea of giving higher priority to low-cost patients, in the context of a limited budget, in order to maximise health benefits. The study reported here used semi-structured group discussions to investigate the normative bases of such views among the Australian public. Discussion groups help participants reflect critically upon their own reasoning processes and go some way towards revealing underlying values rather than unreflective preferences. As a part of the exercise, participants were asked to allocate a hospital budget. After discussion and deliberation only three out of 41 chose to allocate all of the money to the low-cost patients. Reasons were not based on conceptual confusion or lack of insight into the implications of the different strategies, but rather on views about fairness, including the importance of giving all groups a 'chance' of being treated and of not removing 'hope' from high-cost patients. The results suggest that as costs rise people are willing to pay more than the minimum cost of a quality-adjusted life year for equity reasons, indicating that caution must be exercised in estimating a single monetary value for a QALY.

Willingness to pay for a quality-adjusted life-year: the individual perspective

OBJECTIVE

The aim of this study was to elicit the individual willingness to pay (WTP) for a quality-adjusted life-year (QALY).

METHODS

In a Web-based questionnaire containing contingent valuation exercises, respondents valued health changes in five scenarios. In each scenario, the respondents first valued two health states on a visual analog scale (VAS) and expressed their WTP for avoiding a decline in health from the better health state to the worse, using a payment scale followed by a bounded open contingent valuation question.

ANALYSIS

WTP per QALY was calculated for QALY gains calculated using VAS valuations, as well as the Dutch EQ-5D tariffs, the two steps in the WTP estimations and each scenario. Heterogeneity in WTP per QALY ratios was examined from the perspective of: 1) household income; and 2) the level of certainty in WTP indicated by respondents. Theoretical validity was analyzed using clustered multivariate regressions.

RESULTS

A total of 1091 respondents, representative of the Dutch population, participated in the survey. Mean WTP per QALY was € 12,900 based on VAS valuations, and € 24,500 based on the Dutch EuroQoL tariffs. WTP per QALY was strongly associated with income, varying from € 5000 in the lowest to € 75,400 in the highest income group. Respondents indicating higher certainty exhibited marginally higher WTP. Regression analyses confirmed expected relations between WTP per QALY, income, and other personal characteristics.

CONCLUSION

  Individual WTP per QALY values elicited in this study are similar to those found in comparable studies. The use of individual valuations in social decision-making deserves attention, however.