Sample restrictions and the elicitation of a constant willingness to pay per quality adjusted life year.

Jytte Seested Nielsen,Dorte Gyrd‐Hansen,Trine Kjær

doi:10.1002/hec.4236

Jytte Seested Nielsen, Dorte Gyrd‐Hansen + Show 1 more

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https://doi.org/10.1002/hec.4236

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Abstract

It is well established that the underlying theoretical assumptions needed to obtain a constant proportional trade-off between a quality adjusted life year (QALY) and willingness to pay (WTP) are restrictive and often empirically violated. In this paper, we set out to investigate whether the proportionality conditions (in terms of scope insensitivity and severity independence) can be satisfied when data is restricted to include only respondents who pass certain consistency criteria. We hypothesize that the more we restrict the data, the better the compliance with the requirement of constant proportional trade-off between WTP and QALY. We revisit the Danish data from the European Value of a QALY survey eliciting individual WTP for a QALY (WTP-Q). Using a "chained approach" respondents were first asked to value a specified health state using the standard gamble (SG) or the time-trade-off (TTO) approach and subsequently asked their WTP for QALY gains of 0.05 and 0.1 (tailored according to the respondent's SG/TTO valuation). Analyzing the impact of the different exclusion criteria on the two proportionality conditions, we find strong evidence against a constant WTP-Q. Restricting our data to include only respondents who pass the most stringent consistency criteria does not impact on the performance of the proportionality conditions for WTP-Q.

Highlights

There is an ongoing debate about what value to place on a quality adjusted life year (QALY) and appropriate ways of estimating such a threshold
For scope insensitivity, the willingness to pay (WTP)‐Q must be independent of the size of the health gain individuals are asked to value1, whereas severity independence implies that for sized QALY gains, the elicited WTP for a QALY (WTP‐Q) must be independent of health state
We aim to investigate whether the two proportionality conditions for WTP‐Q outlined above can be satisfied when data is restricted to include only respondents who pass a set of strict consistency criteria

Summary

Introduction

There is an ongoing debate about what value to place on a quality adjusted life year (QALY) and appropriate ways of estimating such a threshold. It is well established that the underlying theoretical assumptions needed to obtain a constant proportional trade‐off between QALY and WTP, and a constant value of a QALY (WTP‐Q) estimate, are Health Economics. Two conditions that need to be satisfied are scope insensitivity and severity independence. Whereas the former can be classified as a traditional test of the sensitivity of WTP to the size of the good, the latter tests the extent to which severity of the initial health states impacts on valuation. For scope insensitivity, the WTP‐Q must be independent of the size of the health gain individuals are asked to value, whereas severity independence implies that for sized QALY gains, the elicited WTP‐Q must be independent of health state. While the paucity in studies in this area, at least partly, can be explained by the data requirements needed to conduct such analyses, it remains unclear whether the failure to fulfill the proportionality conditions is a result of nonrandom variation in response patterns which could be mitigated

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