Value & Valuation

The economic evaluation of medical interventions – in particular, in the context of Health Technology Assessments (HTAs) – invariably implies some kind of (explicit or implicit) cost value analysis. One possible anchor is the value of a statistical life year (VSLY). However, currently used benchmarks for the willingness-to-pay (WTP) per quality-adjusted life year (QALY) gained are controversial. In economics, WTP represents the concept of stated or revealed preferences and hence can be interpreted as a demand-side perspective. As an alternative measure, especially in resource-constrained health care systems, shadow prices for a QALY have been proposed and computed. Unfortunately, these calculations rest on a set of assumptions and conventions (“the logic of cost effectiveness”), some of which must be considered “descriptively flawed” (Dolan et al., 2005). Descriptively flawed is nothing less than a euphemism for “empirically falsified,” unless one was prepared to ignore well-documented social norms and preferences.

The Institute and its members have been heavily involved in a broad range of projects, past and ongoing, that are dedicated to exploring and further improving currently used valuation methods of “life and limb” (cf. Mishan, 1971; Viscusi, 1978; Jones-Lee, 1985).

More detailed information will follow soon, including projects on the following topics:

• The Value of a Statistical Life Year (VSLY)
• The Logic of Cost Effectiveness
• Health-Related Quality of Life (HRQoL)
• Patient-Reported Outcomes (PROs)
• Socioeconomic Impact (SEI) Research
• Social Cost Value Analysis (SCVA)
• The Ultra-Rare Disease (URD) Evaluation Consensus Project