Quality adjusted life years based on health and consumption: A summary wellbeing measure for cross-sectoral economic evaluation.

Richard Cookson,Matthew Adler,Miqdad Asaria,Owen Cotton‐Barratt,Toby Ord,Ieva Skarda

doi:10.1002/hec.4177

Abstract

We introduce a summary wellbeing measure for economic evaluation of cross‐sectoral public policies with impacts on health and living standards. We show how to calculate period‐specific and lifetime wellbeing using quality‐adjusted life years based on widely available data on health‐related quality of life and consumption and normative assumptions about three parameters—minimal consumption, standard consumption, and the elasticity of the marginal value of consumption. We also illustrate how these three parameters can be tailored to the decision‐making context and varied in sensitivity analysis to provide information about the implications of alternative value judgments. As well as providing a general measure for cost‐effectiveness analysis and cost‐benefit analysis in terms of wellbeing, this approach also facilitates distributional analysis in terms of how many good years different population subgroups can expect to live under different policy scenarios.

Highlights

Many public policies have important long‐run impacts on both health and living standards—including policies on social protection, education, employment and crime as well as health care and public health
Our proposed measure is a broader version of the quality‐adjusted life year (QALY) measure of health used in health economics (Cookson & Culyer, 2010)
We have proposed a practical way of evaluating cross‐sectoral policies by combining data on consumption, health‐related quality of life (HRQoL) and mortality to measure years of good life or wellbeing QALYs

Summary

| INTRODUCTION

Many public policies have important long‐run impacts on both health and living standards—including policies on social protection, education, employment and crime as well as health care and public health. By “poverty‐to‐prosperity” we mean increasing a person's annual consumption level from $600 (the World Bank absolute poverty line) to $30,000, a prosperous living standard set approximately equal to the average living standard in the USA This scenario implies a gain of $29,400 in monetary terms and, under our assumptions, a gain of around 0.76 (1⁄41.00À 0.24) wellbeing QALYs (see Figure 1). The wellbeing QALY allows us to provide a general measure of distributional impact on lifetime wellbeing, as well as domain‐specific measures of distributional impact on consumption, health and other specific outcomes Such analysis, requires the availability of individual level data on the two wellbeing dimensions—health quality and income—over the whole lifecourse. One can compute indices of inequality in experienced lifetime wellbeing between individuals, and differences in expected years of good life at birth between different population subgroups

| Summary

Findings

| Strengths and limitations