Institute for Applied Health Research

and

Institute for Society and Social Justice Research

Yunus Centre for Social Business & Health

Estimating willingness-to-pay based values of a QALY: principles and practice

Cam Donaldson

Yunus Chair in Social Business & HealthNIHR Senior Investigator

Presentation to 32nd Annual Meeting of Spanish HealthEconomics Association, Bilbao, 15-18th May 2012

The Independent on Sunday

12th October 2008

Outline of talk

• The policy background in England (and elsewhere?)

• Other origins of EuroVaQ (European Value of a QALY)

• What we did on EuroVaQ, including some results

• Critique of “WTP for a QALY”

The policy route to SVQ. In England…

• NICE makes recommendations to rest of NHS

• Requires judgements about value of QALY gains

• Politically controversial, leading to questions of:

What weights might be attached to QALY gains in different situations?

But also, is the threshold itself right?

• These questions led to the Social Value of a QALY (SVQ) project?

SVQ: participating organisations

SVQ process of monetary valuation

Describe illness

(different lengths and

severities of stomach

and headache

conditions, due to

commonality)

Utility value

(standard

gamble)

Money value

(WTP)

WTP/QALY

Monetary Value of a QALY: simple calculation

Suppose WTP to avoid 12 months of illness = £1000...

...and point of indifference between certainty of lifelong illness and the risky treatment occurs where the probability (p) of normal health = 0.95 and probability of death (1-p) = 0.05

Value of a QALY = £1000 † 0.05 = £20,000

Good and bad outcomes

• Usual challenges and advantages:

• e.g. between-sample insensitivity• respondents positive (engaged; very few „protest

zeros‟)

• Means of individual ratios ran into £Ms!

• If, in a standard gamble, someone is willing totake only a 1/100,000 risk (or less) of death to avoid being permanently in a minor health state, his/her WTP to avoid being in that state for a year would be multiplied by 100,000...!

• So, needed to find health states severe enoughto be traded in health state utilityassessments, but not too large to „blow thebudget‟ in WTP part

Meanwhile, elsewhere in Europe

• Pinto Prades et al., Journal of Health Economics 2009; 28: 553-562:

• Same problems as encountered in SVQ

• Gyrd-Hansen, Health Economics 2003; 12: 1049-1060:

• Lower values, but did not embed health state utilityassessment in the procedure

Birzeit University, Palestine

Corvinus University Budapest, Hungary

Erasmus University Rotterdam, Netherlands

Jagellonian University Medical College, Poland

Newcastle University, UK

Pablo de Olavide University, Spain

University of East Anglia, UK

University of Lund, Sweden

University of the Mediterranean, France

University of Tromso, Norway

University of Southern Denmark, Denmark

University of York, UK

Partner Organisations

Main objective

To develop more robust methods to determine the monetary value of a QALY across a number of European Member States:

• Largely methodological in nature

Cluster 2 – Web-based surveys

Two main approaches devised based on WTP-based contingent valuation:

• Modified „chained‟ (WTP with health state utility assessment); and

• „Direct‟ (“What is the value of one whole QALY?”)

Sampling frame

CHAINED respondents 2000 per partner country

- ran from 1st Dec 2009-28th Feb 2010

DIRECT respondents 1500 per partner country

- ran from 20th Nov 2009-28th Feb 2010

Nationally representative samples according to:

– Age and gender– Region– Socio economic classification

Achieved:

- 39,951 total; 21,983 chained; 17,968 direct

The Chained Survey

Elicit WTP for some fraction of a QALY, then „multiply‟ up value into whole QALY:

• If valuing a 0.05 QALY gain, then multiply by 20• If valuing a 0.1 QALY gain, then multiply by 10

Also, made use of EQ-5D and a TTO.

Aimed to keep QALY loss small and roughly constant across respondents:

• „tailored‟ WTP to individuals‟ assessmentsof health states, so valued only 0.05 and 0.1QALY gains

Describe health

state

EQ- 5D

Utility value

(SG or TT0)

Money value

(willingness

to pay)

WTP per

QALY

Key design features

• Two EQ-5D health states:

Green (22222), Yellow (21121)

Moderate and mild, and one dominates other

• Two value elicitation procedures:

Standard gamble (SG), Time trade off (TTO)

• WTP questions tailored to individuals‟ responses to SG

and TTO so as to ensure they are valuing one of:

0.05 QALY gain

0.10 QALY gain

• All respondents valued both states, but one

health state utility procedure (SG or TTO) and

randomly assigned to tailoring procedure and

starting with yellow or green

Tailoring proceduresTime variantIf health state utility assessment of yellow health state leads to a

value of 0.80, then a return to full health involves a 0.2 gain, so:

To avoid 0.10 QALY loss, need to spend 6 months in yellow state,

and;

To avoid a 0.05 QALY loss, need to avoid 3 months in yellow state

Risk VariantAgain, if health state utility assessment of yellow state leads to a

value of 0.8, then return to full health involves a 0.2 gain, so:

To avoid 0.10 QALY loss, need to avoid a 50% chance ofbeing in yellow state over coming year

and;

To avoid 0.05 QALY loss, need to avoid 25% chanceof being in yellow state over coming year

Methodological Questions

Is estimated WTP per QALY robust to:

1. 1/20th vs 1/10th QALY gain?

2. Risk or Time variant WTP question?

3. Severity of health state used (green or yellow)?

4. SG or TTO utilities?

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Methodological Questions

Is estimated WTP per QALY robust to:

1. 1/20th vs 1/10th QALY gain?

2. Risk or time variant WTP question?

3. Severity of health state used (green or yellow)?

4. SG or TTO utilities?

Framing:Risk Time

QALY

gain:

0.05 GR,0.05YR,0.05 GT,0.05YT,0.05

0.10 GR,0.1YR,0.1 GT,0.1YT,0.1

The WTP questions

Framing:Risk Time

QALY

gain:

0.05 GR,0.05YR,0.05 GT,0.05YT,0.05

0.10 GR,0.1YR,0.1 GT,0.1YT,0.1

Hypothesis One

Framing:Risk Time

QALY

gain:

0.05 GR,0.05YR,0.05 GT,0.05YT,0.05

0.10 GR,0.1YR,0.1 GT,0.1YT,0.1

Hypothesis One

Framing:Risk Time

QALY

gain:

0.05 GR,0.05YR,0.05 GT,0.05YT,0.05

0.10 GR,0.1YR,0.1 GT,0.1YT,0.1

Hypothesis One

Framing:Risk Time

QALY

gain:

0.05 GR,0.05YR,0.05 GT,0.05YT,0.05

0.10 GR,0.1YR,0.1 GT,0.1YT,0.1

Hypothesis One

Data management

All results relate to WTP per QALY

In US dollars PPP

Means top trimmed at 1% by country

„Protest‟ zeros are excluded

Non traders in SG /TTO who went on to pay positive WTP amount are excluded (as effectively haveinfinite WTP per QALY)

Inconsistent respondents retained in data

Mean WTP per QALY ($US PPP)

UK Spain All country

GR,0.05 23,267 38,162 34,097

GR,0.1 21,182 50,083 30,581

GT,0.05 29,308 52,876 33,236

GT.0.1 15,897 33,798 22,057

YR,0.05 23,285 25,629 26,386

YR,0.1 14,848 28,049 19,129

YT,0.05 20,525 39,356 29,726

YT,0.1 13,228 26,299 18,247

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Size of QALY gain: green states

UK Spain All country

GR,0.05 23,267 38,162 34,097

GR,0.1 21,182 50,083 30,581

GT,0.05 29,308 52,876 33,236

GT,0.1 15,879 33,798 22,057

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UK Spain All country

YR,0.05 23,285 25,629 26,386

YR,0.1 14,848 28,049 19,129

YT,0.05 20,525 39,356 29,726

YT,0.1 13,228 26,299 18,247

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Size of QALY gain: yellow states

38

0

2.000

4.000

6.000

8.000

10.000

12.000

14.000

16.000

18.000

WTP per QALY Medians by Country

GR,0.05 GR,0.1

$

Didn’t get time to tell you about...

• Inconsistencies in responses

• Little difference between risk variant and time variant

• Lower WTP per QALY with milder health state

• WTP values slightly higher with TTO

• Direct approach

Consistencies in the data

• income

• age

• socio-economic group

• some countries always higher than others

In defence of WTP for a QALY• Searchers vs surveyors:

“information about how much an individual or society values improvements in health (i.e. their willingness to pay for a QALY) is not at all relevant to the NICE remit” (Culyer et al., JHSRP 2007, 12: p57).

• Detachment from budgetary process:

• Do views of public not count at all?

• Is NICE already detached from NHS budget?

• How easy is it to „search and find‟?

• Would WTP at the margin really be that differentfrom cost per QALY at the margin?

• Threat to the Constitution:

• What is legitimate?

• Ability to pay:

• Same value applies to all

Some concluding thoughts

• Overall, results not too threatening to HTA organisations:

• Data behave pretty much as expected and nothing is outrageously high if we accept minor adjustments

• Low EuroVaQ values are not out of line with other avenues of enquiry

• But, threats to governments and HTA organisations exist:

• Because of low values and the high values• If they persist in using a single value

• In research terms:

• Some approaches can be ruled out• Still need to deal with non-trading in chained

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