health state evaluation and utility theory

Alastair McGuire

from Palgrave Macmillan

Abstract: Valuing health outcomes is a fundamental concern in health economics. This article considers a measure of health outcomes: the Quality Adjusted Life Year (QALY). The QALY has been used extensively for two main reasons: (1) it arguably values health outcomes in a more acceptable metric than money does; and (2) it feeds more easily into the wider medical decision-making. To be an acceptable measure of health state preferences, however, the QALY requires a number of restrictive assumptions to hold. We discuss these assumptions and conclude that, if these do not hold, the QALY reverts to a measure of health state rather than to a health state preference.

Keywords: Disability Adjusted Life Years (DALY); Quality Adjusted Life Year (QALY); social policy; utility theory; Years of Healthy Life (HYL) (search for similar items in EconPapers)
JEL-codes: I12 I18 (search for similar items in EconPapers)
Date: 2013
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