COST PER QALY METHOD

Cost per qaly method

Cost per qaly method

Introduction

In many ethical dilemmas in health care, for example informed consent, confidentiality or end of life decisions, the focus is on the individual patient. However, in considering how to make the best use of limited health care resources, the focus of the decision shifts from the individual patient to a group of patients or potential patients, which may be the national population, a local community, or users of a specific service in an a hospital (Daniels, 2000).

A criticism of this theory is that it fails to take into account the 'need' for healthcare intervention and relies rather on cost effectiveness. The practical application of utilitarian theory in allocation of health care resources can be seen in the use of Quality Adjusted Life Years (QALYs) as a means of quantifying the net benefit from health care interventions to allow comparison of different interventions (Daniels, 2000).

QALYS

QALY stands for Quality Adjusted Life Year.Alan Williams has described the thinking behind the development of QALYs thus:

The essence of a QALY is that it takes a year of healthy life expectancy to be worth 1, but regards a year of unhealthy life expectancy as worth less than 1. Its precise value is lower the worse the quality of life of the unhealthy person (which is what the 'quality adjusted' bit is all about) (Daniels, 2000).

Health care interventions are measured both by the number of extra years of life, and by the increased quality of life, that they can achieve. Thus an intervention that provides 10 years of extra life at full health would have a QALY value of 10, and an intervention that improves quality of life from 0.5 to 0.8 for a person with a predicted further life expectancy of 30 years, would have a QALY value of 9. [0.3 (0.8-0.5) multiplied by 30]. Once the QALY value of a health care intervention is calculated and its cost is known it is then possible to calculate the cost per QALY of each intervention and provide a direct comparison between interventions. The general idea is that a high priority health care activity is one where the cost per QALY is as low as it can be (Butler, 1999).

Some examples of Cost per QALY calculations:

Hospital dialysis for end-stage renal disease for patients aged 55 - 64 years (compared with no treatment)

£45, 000

Coronary artery bypass graft for patients ...