Improving Value Measurement in Cost-Effectiveness Analysis

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Abstract
Before cost-effectiveness analysis (CEA) can fulfill its promise as a tool to guide health care allocation decisions, the method of incorporating societal values into CEA may need to be improved. The study design was a declarative exposition of potential fallacies in the theoretical underpinnings of CEA. Two values held by many people—preferences for giving priority to severely ill patients and preferences to avoid discrimination against people who have limited treatment potential because of disability or chronic illness—that are not currently incorporated into CEA are discussed. Traditional CEA, through the measurement of quality-adjusted life years (QALYs), is constrained because of a “QALY trap.” If, for example, saving the life of a person with paraplegia is equally valuable as saving the life of a person without paraplegia, then current QALY methods force us to conclude that curing paraplegia brings no benefit. Basing cost-effectiveness measurement on societal values rather than QALYs may allow us to better capture public rationing preferences, thereby escaping the QALY trap. CEA can accommodate a wider range of such societal values about fairness in its measurements by amending its methodology.