Monetary valuation of one year in full capability and health based on demographics, health status, income and well-being

ABSTRACT

Background

Budget constraints in health-care systems have led to the popularity of Cost Effectiveness Thresholds (CET) to achieve efficient allocation of resources. The capability approach has been hailed for its potentially richer evaluative capabilities compared to the QALY in terms of thresholds. Extensive research, however, is still limited.

Research design and methods

This study estimated the monetary value of a year in full capability (YFC) and compared it to monetary value of a QALY for the Hungarian population. Data was collected from a large, cross sectional, representative online survey on the adult Hungarian population. Applying the wellbeing valuation method, health, capability, and income were then regressed against wellbeing to estimate ‘shadow prices’ for one QALY and YFC controlling for gender, age, employment, education, marital and social support. To examine ‘core’ regression coefficients, a robustness check was conducted.

Results

Health (VAS) and capability (ICECAP-A) had a positive and significant effect on Subjective Well-Being. The monetary values of one QALY and one YFC were 39 459 EUR and 58 148 EUR respectively.

Conclusions

These tools provide a systematic approach to determining ‘compensating income’ for certain illnesses, disabilities and levels of pain. The capability approach shown to be broader than the QALY.

KEYWORDS:

• Cost effectiveness
• quality adjusted life years (QALYs)
• capability
• year
• in full capability (YFC)
• subjective well-being

Declaration of Interest

M Thema, Z Beretzky, V Brodszky were supported by the Higher Education Institutional Excellence Program of the Ministry of Innovation and Technology in the framework of the ‘Financial and Public Services’ research projects (NKFIH-1163-10/2019 and TKP2020-IKA-02). The authors have no other relevant affiliations or financial involvement with any organization or entity with a financial interest in or financial conflict with the subject matter or materials discussed in the manuscript apart from those disclosed.

Reviewer disclosures

Peer reviewers on this manuscript have no relevant financial or other relationships to disclose.

Author contributions

Conception and design: V Brodszky; Acquisition, analysis and interpretation of the data: M Thema, Z Beretzky, V Brodszky; Obtaining funding: Z Beretzky, V Brodszky; Drafting original manuscript: M Thema; Revising it critically for intellectual content: M Thema, Z Beretzky, V Brodszky; All authors approved the version to be published.

Additional information

Funding

This paper was funded by the Higher Education Institutional Excellence Program of the Ministry of Innovation and Technology in the framework of the ‘Financial and Public Services’ research projects (NKFIH-1163-10/2019 and TKP2020-IKA-02).