How to put a price on a life – explaining Quality-Adjusted Life Years (QALY)

In all the time I’ve spent teaching ethics – from trolley problems to discussions of civilian casualties at war to the ethics of firefighting – there have been a few consistent trends in what matters to people.

One of the most common is that in life-and-death situations, details matter. People want to know exactly who might die or be rescued: how old are they? Are they healthy? Do they have children? What have they done with their life?

What they’re doing, whether they know it or not, is exploring what factors could help  decide which life it would be most reasonable, or most ethical to save, relative to the other lives on the table.

Moreover, it’s not only in times of war or random thought experiments that these questions arise. Every decision about where to allocate health resources is likely to have life-or-death consequences. Allocate more funding to women’s shelters to address domestic violence and you’ll save lives. However, how many lives would you save if that same money were used to fund more hospital beds, or was invested into mental health support in rural communities?

One widely-used method for ensuring health resources are allocated as efficiently as possible is to use QALY’s – quality-adjusted life years. QALY is an approach that was developed in the 1970’s to more precisely, consistently and objectively determine the effectiveness and efficiency of different health measures.

Here’s how it works: imagine a year of life enjoyed at full health. It gets assigned a score of 1. Every year of life lived at less than full health gets assigned a lower score. The worse off the person’s health, the lower the score.

For example, take someone who has to undergo chemotherapy for five years. They have full mobility, but have some difficulty with usual activities, severe pain and mild mental health challenges. They might be given a QALY score of 0.55.

Once we’ve gotten a QALY score, we then need to work out how much the healthcare costs. Then, it’s simple maths: multiply the cost by the QALY score and you get an idea of how much each QALY is costing you. Then you can compare the cost effectiveness of different health programs.

QALY’s are usually seen as a utilitarian method of allocating health resources – it’s about maximising the utility of the healthcare system as a whole. However, like most utilitarian approaches, what works best overall doesn’t work best in individual cases. And that’s where criticisms of QALY arise.

Let’s say two patients come in with the same condition – COVID-19. One of them is young, non-disabled and has no other health conditions affecting their quality of life. The other person is elderly, has a range of other health conditions and is in the early stages of dementia. Both patients have the same condition. However, according to the QALY approach, they are not necessarily entitled to the same level of care – for example, a ventilator if resources are scarce. The cost per QALY for the younger patient is far lower than for the elderly patient.

For this reason, QALY’s are sometimes seen as inherently unjust. They fail to provide all people with equal access to healthcare treatment. Moreover, as philosopher and medical doctor Bryan Mukandi argues, if two patients with the same condition are expected to have different health outcomes, there’s a chance that’s the result of historical injustices. Say, a person with type-2 diabetes receives a lower QALY score as a result, but type-2 diabetes is correlated with lower income, the scoring system might serve to entrench existing advantage and disadvantage.

Like any algorithmic approach to decision-making, QALYs present as neutral, mathematic and scientific. That’s why it’s important to remember, as Cathy O’Neil says in Weapons of Math Destruction, that algorithms are “opinions written in code.”

Embedded within QALY’s method are a range of assumption about what ‘full health’ is and what it is not. For instance, a variation on the QALY methodology call DALY – disability-adjusted life years – “explicitly presupposes that the lives of disabled people have less value than those of people without disabilities.”

An alternative to the QALY approach is to adopt what is known simply as a ‘needs-based’ approach. It’s sometimes described as a ‘first come, first served’ approach. It prioritises the ideal of healthcare justice above health efficiency – everyone deserves equal access to healthcare, so if you need treatment, you get treatment.

This means, to go back to our elderly and young patients with COVID-19, that whoever arrives at the hospital first and has a clinical need of a ventilator will get one. QALY advocates will argue that in times of scarcity, this is an inefficient approach that may border on immoral. After all, shouldn’t the younger person be given the same chance at life as the elderly person?

However, there is something radical underneath the needs-based approach. QALY’s starting point is that there are limited health resources, and therefore some people will have to miss out. A needs-based approach allows us to do something more radical: to demand that our healthcare is equipped, as much as possible, to respond to the demand. Rather than doing the best with what we have, we make sure we have what is necessary to do the best job.

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