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Valuing avoided morbidity using meta‐regression analysis: what can health status measures and QALYs tell us about WTP?

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  • George Van Houtven
  • John Powers
  • Amber Jessup
  • Jui‐Chen Yang

Abstract

Many economists argue that willingness‐to‐pay (WTP) measures are most appropriate for assessing the welfare effects of health changes. Nevertheless, the health evaluation literature is still dominated by studies estimating nonmonetary health status measures (HSMs), which are often used to assess changes in quality‐adjusted life years (QALYs). Using meta‐regression analysis, this paper combines results from both WTP and HSM studies applied to acute morbidity, and it tests whether a systematic relationship exists between HSM and WTP estimates. We analyze over 230 WTP estimates from 17 different studies and find evidence that QALY‐based estimates of illness severity – as measured by the Quality of Well‐Being (QWB) Scale – are significant factors in explaining variation in WTP, as are changes in the duration of illness and the average income and age of the study populations. In addition, we test and reject the assumption of a constant WTP per QALY gain. We also demonstrate how the estimated meta‐regression equations can serve as benefit transfer functions for policy analysis. By specifying the change in duration and severity of the acute illness and the characteristics of the affected population, we apply the regression functions to predict average WTP per case avoided. Copyright © 2006 John Wiley & Sons, Ltd.

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  • George Van Houtven & John Powers & Amber Jessup & Jui‐Chen Yang, 2006. "Valuing avoided morbidity using meta‐regression analysis: what can health status measures and QALYs tell us about WTP?," Health Economics, John Wiley & Sons, Ltd., vol. 15(8), pages 775-795, August.
    • Handle: RePEc:wly:hlthec:v:15:y:2006:i:8:p:775-795
    DOI: 10.1002/hec.1105
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    2. Rheinberger, Christoph M. & Hammitt, James K., 2014. "The welfare value of FDA's mercury-in-fish advisory: A dynamic reanalysis," Journal of Health Economics, Elsevier, vol. 37(C), pages 113-122.
    3. James Hammitt, 2013. "Admissible utility functions for health, longevity, and wealth: integrating monetary and life-year measures," Journal of Risk and Uncertainty, Springer, vol. 47(3), pages 311-325, December.
    4. Kevin Boyle & Sapna Kaul & Ali Hashemi & Xiaoshu Li, 2015. "Applicability of benefit transfers for evaluation of homeland security counterterrorism measures," Chapters, in: Carol Mansfield & V. K. Smith (ed.), Benefit–Cost Analyses for Security Policies, chapter 10, pages 225-253, Edward Elgar Publishing.
    5. Mehmet Kutluay & Roy Brouwer & Richard S. J. Tol, 2019. "Valuing malaria morbidity: results from a global meta-analysis," Journal of Environmental Economics and Policy, Taylor & Francis Journals, vol. 8(3), pages 301-321, July.
    6. Hammitt, James & Haninger, Kevin, 2011. "Valuing Morbidity Risk: Willingness to Pay per Quality-Adjusted Life Year," LERNA Working Papers 11.09.343, LERNA, University of Toulouse.
    7. Moeltner Klaus & Rosenberger Randall S, 2008. "Predicting Resource Policy Outcomes via Meta-Regression: Data Space, Model Space, and the Quest for 'Optimal Scope'," The B.E. Journal of Economic Analysis & Policy, De Gruyter, vol. 8(1), pages 1-31, August.
    8. Robinson Lisa A. & Hammitt James K., 2013. "Skills of the trade: valuing health risk reductions in benefit-cost analysis," Journal of Benefit-Cost Analysis, De Gruyter, vol. 4(1), pages 107-130, March.
    9. Ana Bobinac & Job Exel & Frans Rutten & Werner Brouwer, 2014. "The Value of a QALY: Individual Willingness to Pay for Health Gains Under Risk," PharmacoEconomics, Springer, vol. 32(1), pages 75-86, January.
    10. Herrera-Araujo, Daniel & Hammitt, James K. & Rheinberger, Christoph M., 2020. "Theoretical bounds on the value of improved health," Journal of Health Economics, Elsevier, vol. 72(C).
    11. John McKie & Bradley Shrimpton & Jeff Richardson & Rosalind Hurworth, 2011. "The monetary value of a life year: evidence from a qualitative study of treatment costs," Health Economics, John Wiley & Sons, Ltd., vol. 20(8), pages 945-957, August.
    12. Stein, Alexander J. & Meenakshi, J.V. & Qaim, Matin & Nestel, Penelope & Sachdev, H.P.S. & Bhutta, Zulfiqar A., 2008. "Potential impacts of iron biofortification in India," Social Science & Medicine, Elsevier, vol. 66(8), pages 1797-1808, April.
    13. Zhuanlan Sun & Demi Zhu, 2019. "Exposure to outdoor air pollution and its human health outcomes: A scoping review," PLOS ONE, Public Library of Science, vol. 14(5), pages 1-18, May.
    14. Tracy Lieu & G. Ray & Ismael Ortega-Sanchez & Ken Kleinman & Donna Rusinak, 2009. "Willingness to Pay for a QALY Based on Community Member and Patient Preferences for Temporary Health States Associated with Herpes Zoster," PharmacoEconomics, Springer, vol. 27(12), pages 1005-1016, December.
    15. Hammitt, James K. & Haninger, Kevin, 2017. "Valuing nonfatal health risk as a function of illness severity and duration: Benefit transfer using QALYs," Journal of Environmental Economics and Management, Elsevier, vol. 82(C), pages 17-38.
    16. Bobinac, Ana & van Exel, N. Job A. & Rutten, Frans F.H. & Brouwer, Werner B.F., 2012. "GET MORE, PAY MORE? An elaborate test of construct validity of willingness to pay per QALY estimates obtained through contingent valuation," Journal of Health Economics, Elsevier, vol. 31(1), pages 158-168.

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