Health care policy evaluation: empirical analysis of the restrictions implied by Quality Adjusted Life Years, CHERE Working Paper 2006/10
AbstractThis paper investigates the nature of the utility function for health care, defined over the probability of survival, survival duration, health state and cost of treatment. A discrete choice experiment, involving treatment choice for a hypothetical health condition is used to test restrictions on preferences in the QALY model. We find that preferences do not conform to expected utility, and there are significant interactions between health state and survival duration. Individual characteristics are significant, implying substantial differences in valuations of health states across the population. The results suggest the QALY approach distorts valuations of health outcomes.
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Bibliographic InfoPaper provided by CHERE, University of Technology, Sydney in its series Working Papers with number 2006/10.
Date of creation: Jun 2006
Date of revision:
Discrete choice experiment; Qalys; preferences; health state valuation;
Find related papers by JEL classification:
- I19 - Health, Education, and Welfare - - Health - - - Other
This paper has been announced in the following NEP Reports:
- NEP-ALL-2007-08-08 (All new papers)
- NEP-DCM-2007-08-08 (Discrete Choice Models)
- NEP-HEA-2007-08-08 (Health Economics)
- NEP-UPT-2007-08-08 (Utility Models & Prospect Theory)
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