The QALY Measures Everything... Except What Makes Life Worth Living

The article “the much-maligned 'quality-adjusted life year' is a vital tool for health care policy’ by Joshua T. Cohen,?Peter J. Neumann?and?Daniel A. Ollendorf is misleading and deceptive.

?The authors claim that "banning their use would mean that health insurers that negotiate drug prices and government agencies that allocate resources cannot make an apples to apples "comparisons across diverse treatments and diseases."?

?But PBMs and government agencies have extorted – I mean negotiated -- nearly $200 BILLION in rebates last year without a QALY.

?More to the point, an apples-to-apples comparison means ignoring the value people with rare and severe illnesses place on medicines. Indeed, the underlying principle of using the QALY is “a particular improvement in health should be regarded as of equal value, no matter who gets it, and should be provided unless it prevents a greater improvement being offered to someone else.”

?That is not just discriminatory.?It’s lazy economics that, as ICER admits, only focuses on saving money for insurers, as if $200 billion in rebate wasn’t enough.?

?They claim the QALY is scientific. In fact, as Sir Michael Rawlins, the former chairman of the National Institute for Health and Clinical Excellence (NICE), noted, " QALY is really a rule of thumb for framing choice. “ Which is why NICE is moving away from the QALY.

?The authors act as if the dollar value range of the QALY is found in the Torah. But the “rule of thumb” of $50,000-$150,000 per QALY is designed to impose an upper limit on what society should pay to keep someone alive and healthy for a year.?Many other government agencies place a much higher value on human life.??

?For instance, the Environmental Protection Agency set the value of life at $ 9.1 million last year, much more than the $6.8 million figure the agency used during the Bush administration. Likewise, last year, the Food and Drug Administration (FDA) said that life is worth $7.9 million---significantly more than in 2008 when the FDA put a $5 million value on life.?The Department of Transportation sets its sights slightly lower, quoting around $6 million for a life.[1]?

?The authors claim that ICER has used the current QALY construct benevolently. They trot out one or two examples of when ICER said drugs were cost-effective, again conceding that the QALY only measures how much money it can save health plans. The QALY, as designed and used, regards death as cost-effective.

?Since 2016, ICER has deemed only three medicines out of nearly 100 evaluated for rare and life-threatening diseases cost-effective at or near the average 20 percent rebated price.?That includes medications for multiple myeloma, sickle cell anemia, ALS, and chronic kidney disease. Most other drug prices would have to be cut by 50 percent to 100 percent.

?Indeed, ICER counts the ability of a new drug to improve well-being by extending life as a cost, not a benefit. ICER claimed a medicine to reduce anemia from chronic kidney disease was not cost-effect" "because more people will live longer, more people will be at risk of needing care for end-organ damage, increasing the cost of keeping people alive.”

?Similarly, it noted that new sickle cell anemia drugs reduce the risk of death from these chronic conditions, making it less cost-effective. ICER chose to use the highest estimates of the risk of death to give an optimistic estimate of the (cost-effectiveness) of the treatment effect.”

?Further, ICER claims that new medicines for rare diseases, especially those afflicting children, are too costly at any price. ICER asserts, “the opportunity cost of supporting the use of ultra-orphan drugs necessitates that patients with a more common disease, for which a cost-effective treatment is available, are denied treatment.” As ICER president Steve Pearson wrote, orphan drug spending places “an undue burden on others.”

?This assertion is both morally repugnant and factually misleading. Why should the cost of orphan drugs be pitted against spending on other forms of care for most patients? Why not pit the high cost of hospitalization relative to medicines for so-called common diseases? What about the vast amount of spending on ineffective or needless care? So much for their flaccid assertion that a QALY allows apples to apple comparison.

?Finally, the authors claim that the QALY is only used to get the best patient value.?Yet ICER has previously stated that:

?“When we’re paying for drugs and don’t know the drug’s value, individually, we may pay more out of pocket and more for insurance. While if we’re covered at work, and our employer is paying more in premiums, we may not get as big a raise as we otherwise would have. We also pay more in taxes as the government (Medicare, Medicaid, and federal employees) has to pay more for health care.?We’re siphoning off resources for other things we need like better schools and more resources for local police, roads and bridges.”

?It is that mindset, that belief that because people with genetic conditions are likely to be sicker and more likely to require medical care as they live longer, that justifies the use of the QALY. It is the impulse that elites and economists used at the turn of the century to justify eugenics.

?The authors claim they would support using a novel approach developed by Darius Lakdawalla and Charles Phelps called the Generalized Risk Adjusted Cost-Effectiveness (GRACE) Model, which introduces risk and risk aversion into traditional cost-effectiveness analysis (CEA) models. The GRACE method measures what the QALY ignores: 1) Insurance value, 2) severity of disease, 3) the value of hope, and 4) a reduction of uncertainty. All these can be expressed using a mathematically rigorous framework that incorporates all the traditional elements of CEA.

?Indeed, the GRACE model incorporates the methods of Nobel Prize-winning economists such as Nobel Prize-winning economists Daniel Kahneman, Amartya Sen, Angus Deaton, and William Nordhaus. All have criticized the QALY as impossible to calculate and deficient because it is not designed to fully measure the economic value of improved well-being, particularly the well-being of the most vulnerable.?

?The authors cite the GRACE method as an alternative to the QALY they defend. If they support the GRACE method, why don’t they start using it and encouraging others? Push for changes in the legislation that would explicitly ban the use of the QALY as used by ICER in favor of a more robust and patient-centric approach.?

?We are at a proverbial infection point. If we continue to regard improving the human condition as an unquantifiable added benefit that comes at the expense of spending on other things,?we will be truly lost as a nation.??What Robert Kennedy observed in 1968 when our nation was in chaos seems more relevant today:?

"Too much and for too long, we seemed to have surrendered personal excellence and community values in the mere accumulation of material things. Our Gross National Product…can tell us everything about America except why we are proud that we are Americans.

The gross national product does not allow for the health of our children, the quality of their education, or the joy of their play. It does not include the beauty of our poetry or the strength of our marriages, the intelligence of our public debate, or the integrity of our public officials. It measures neither our wit nor our courage, neither our wisdom nor our learning, neither our compassion nor our devotion to our country. It measures everything in short, except that which makes life worthwhile.?"

We must ensure that Bobby Kennedy's measure of society changes how we think about price controls and health policy. We will win the day if we redefine the debate in these bold terms.?

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[1] https://www.care2.com/causes/epa-puts-the-value-of-human-life-at-9-1-million-fda-says-7-9-million.html