Finding a NICEr way to value health

Policy-makers should shift their attention from the measurement of preferences towards more direct measures of the experiences associated with different states of the world, says Paul Dolan

Like all of us, the National Health Service must make decisions about how best to use its scarce resources. These decisions should be informed by the value of the benefits that health services generate. The National Institute for Health and Clinical Excellence has a strong preference for expressing health benefits in terms of quality-adjusted life years (QALYs). The approach assigns a weight between 0 (for death) and 1 (for full health) to each state of health and then multiplies that value by how long the state lasts. So, one QALY is equivalent to one year of life in full health.

NICE, along with most health economists, recommends that the weight assigned to each health state should reflect our preferences, as expressed through our willingness to exchange extra years of life or the risk of death for improvements in health. Health economists are fond of asking the general public preference questions like “How many years in full health would you consider equivalent to being unable to walk for ten years?” The problem with this type of approach is that the general public are not a reliable basis for this judgement because they are not very good at assessing what it would be like to experience different states of health. In particular, the public tend to be biased in ways that lead them to overestimate the severity of the loss in well-being associated with many-but not all-health states.

This is not really surprising because our responses to questions like the one posed above will largely reflect our immediate emotional reactions to the health state in question. In the case of some severe health states, this is likely to be an initial shock reaction to, or fear associated with, that state. Policy makers may wish to devote resources to the health states that people fear the most but accounting for fear is a quite separate issue from accounting for the losses in well-being from a given health state. Preference-based valuations conflate fears that people have about experiencing poor health with their assessments of how their lives will be affected by poor health.

We could elicit preferences from patients, rather than from the general public, as this would mean that the respondents would have direct experience of the health states in question. However, all responses to preference-based methods, whoever the respondents are, reflect whatever the respondent thinks about or feels at the time of the assessment, which may not be what they will think about or feel while experiencing that health state. Patients could also be asked to consider their previous experiences when making hypothetical choices about the future but there is evidence that we are not very much better at remembering the impact of past experiences than they are at predicting the impact of future ones.

To more accurately reflect the effect of different health states on people’s well-being, and to show where health services really benefit people, I suggest that policy-makers in health and elsewhere should shift their attention from the measurement of preferences towards more direct measures of the experiences associated with different states of the world. The simplest way to do this would be to ask people how satisfied they are with their life overall. By gathering data on health status, and by controlling for a range of other factors known to affect life satisfaction-marital status, income etc- we would be able to estimate the effect that different health states have on how people think and feel about life.

In fact, there are now data available that allow us to make these kinds of estimates. In general, the results suggest that anxiety and depression, even in quite mild forms, have a significant effect on how satisfied people are with their lives. In contrast, we find that limitations in physical functioning generally have much less of an effect. Yet the results from preference elicitation studies suggest that mental health and physical health are broadly comparable in terms of their expected impact.

These are tentative results and I’m no different to any other academic in calling for more research. But as things stand, I think that there are good reasons to believe that NICE would serve us better if it sought to make recommendations about new therapies on the basis of their impact on our real experiences – how we think and feel about our lives – rather than in ways that satisfy our hypothetical preferences over how we imagine thinking and feeling.

Dr. Paul Dolan is Professor of Economics at Imperial College London