How much would you pay for a quality adjusted life year? — ctd.

Previous coverage of this question here. In a recent NEJM Perspective, Peter Neumann, Joshua Cohen, and Milton Weinstein considered it.

The $50,000-per-QALY ratio has murky origins. It is often attributed to the U.S. decision to mandate Medicare coverage for patients with end-stage renal disease (ESRD) in the 1970s: because the cost-effectiveness ratio for dialysis at the time was roughly $50,000 per QALY, the government’s decision arguably endorsed that cutoff point implicitly. However, the link to dialysis is inexact — and even something of an urban legend, given that the cost-effectiveness ratio for dialysis was probably more like $25,000 to $30,000 per QALY, the ESRD decision was controversial, and even at the time Medicare was covering some treatments costing more than $50,000 per QALY.

Furthermore, the $50,000-per-QALY standard did not gain widespread use until the mid-1990s, long after the ESRD decision, and seems to stem more from a series of articles that proposed rough ranges ($20,000 to $100,000 per QALY) for defining cost-effective care. The field settled on $50,000 per QALY as an arbitrary but convenient round number, after several prominent cost-effectiveness analyses in the mid-1990s referenced that threshold and helped to congeal it into conventional wisdom. Researchers continue to cite the threshold regularly, although in recent years more have been referencing $100,000 per QALY. […]

Given the evidence suggesting that $50,000 per QALY is too low in the United States, it might best be thought of as an implied lower boundary. Instead, we would recommend that analysts use $50,000, $100,000, and $200,000 per QALY. If one had to select a single threshold outside the context of an explicit resource constraint or opportunity cost, we suggest using either $100,000 or $150,000.

Not to detract from the piece at all, but just as a point of humor, I like the, “If you had to pick one, here are two” hedge.


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