Karlstad University Working Papers in Economics
No 2:
The Willingness to Pay for a QALY - Results based on value of statistical life estimates in Sweden
Mikael Svensson ()
and Lars Hultkrantz ()
Abstract: As the use of cost-effectiveness analysis with quality
adjusted life years (QALY) as the outcome measure grows in policy use, a
major unresolved issue is that of the monetary value to place on a QALY.
This paper addresses this issue by estimating and discussing willingness to
pay (WTP) estimates for a QALY in Sweden This paper uses all published
estimates of the value of a statistical life since the year 2000, based on
a Swedish population, to implicitly derive the WTP for a QALY. Based on 16
recently published estimates of the value of a statistical life (year 2000
or later) in Sweden, 11 papers explicitly stating that they estimate policy
values of VSL are used to estimate the WTP for a QALY. Estimates range from
750,000 to 3,200,000 Swedish kronor (approx. €80,000 to €350,000) assuming
a discount rate of 3%. Using the current government-recommended estimate of
value of a statistical life produces a value of approx. 1.2 million Swedish
kronor (€130,000) per QALY. There is significant variance in the WTP for a
QALY based on conversions from value of statistical life estimates in
Sweden. Still, using a discount rate of 3%, the range of estimates in this
paper is higher compared to the current informal “thresholds” as discussed
by Swedish government authorities.
Keywords: QALY; Willingness to pay; Value of a statistical life; Contingent Valuation; (follow links to similar papers)
JEL-Codes: D61; H51; I18; (follow links to similar papers)
18 pages, April 2, 2012
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