The quality-adjusted life year (QALY) is a generic measure of disease burden, including both the quality and the quantity of life lived. It is used in economic evaluation to assess the value of medical interventions. One QALY equates to one year in perfect health. QALY scores range from 1 (perfect health) to 0 (dead). QALYs can be used to inform health insurance coverage determinations, treatment decisions, to evaluate programs, and to set priorities for future programs.
Critics argue that the QALY oversimplifies how actual patients would assess risks and outcomes, and that its use may restrict patients with disabilities from accessing treatment. Proponents of the measure acknowledge that the QALY has some shortcomings, but that its ability to quantify tradeoffs and opportunity costs from the patient and societal perspective make it a critical tool for equitably allocating resources.
The QALY is a measure of the value of health outcomes to the people who experience them. It combines two different benefits of treatment—length of life and quality of life—into a single number that can be compared across different types of treatments.
Calculating a QALY requires two inputs. One is the utility value (or utility weight) associated with a given state of health by the years lived in that state. The underlying measure of utility is derived from clinical trials and studies that measure how people feel in these specific states of health. The way they feel in a state of perfect health equates to a value of 1 (or 100%). Death is assigned a utility of 0 (or 0%), and in some circumstances it is possible to accrue negative QALYs to reflect health states deemed "worse than dead." The value people perceive in less than perfect states of health are expressed as a fraction between 0 and 1.
The second input is the amount of time people live in various states of health. This information usually comes from clinical trials.
To calculate the QALY, the two measures are multiplied. For example, one year lived in perfect health equates to 1 QALY.
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Cost–benefit analysis (CBA), sometimes also called benefit–cost analysis, is a systematic approach to estimating the strengths and weaknesses of alternatives. It is used to determine options which provide the best approach to achieving benefits while preserving savings in, for example, transactions, activities, and functional business requirements. A CBA may be used to compare completed or potential courses of action, and to estimate or evaluate the value against the cost of a decision, project, or policy.
The disability-adjusted life year (DALY) is a measure of overall disease burden, expressed as the number of years lost due to ill-health, disability or early death. It was developed in the 1990s as a way of comparing the overall health and life expectancy of different countries. The DALY has become more common in the field of public health and health impact assessment (HIA). It not only includes the potential years of life lost due to premature death, but also includes equivalent years of 'healthy' life lost by virtue of being in states of poor health or disability.
Cost-effectiveness analysis (CEA) is a form of economic analysis that compares the relative costs and outcomes (effects) of different courses of action. Cost-effectiveness analysis is distinct from cost–benefit analysis, which assigns a monetary value to the measure of effect. Cost-effectiveness analysis is often used in the field of health services, where it may be inappropriate to monetize health effect.
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