Willingness to pay for a quality-adjusted life year: Implications for societal health care resource allocation

Joseph T. King, Joel Tsevat, Judith R. Lave, Mark S. Roberts

Research output: Contribution to journalArticlepeer-review

182 Scopus citations


Background. Health-state preferences can be combined with willingness-to-pay (WTP) data to calculate WTP per quality-adjusted life year (QALY). The WTP/QALY ratios provide insight into societal valuations of expenditures for medical interventions. Methods. The authors measured preferences for current health in 3 patient populations (N = 391) using standard gamble, time trade-off, visual analog scale, and WTP, then they calculated WTP/QALY ratios. The ratios were compared with several proposed cost/QALY cost-effectiveness ratio thresholds, the value-of-life literature, and with WTP/ QALY ratios derived from published preference research. Results. Mean WTP/QALY ratios ranged from $12,500 to $32,200 (2003 $US). All values were below most published cost-effectiveness ratio thresholds, below the ratio from a prototypic medical treatment covered by Medicare (i.e., renal dialysis), and below ratios from the value-of-life literature. The WTP/QALY ratios were similar to those calculated from published preference data for patients with symptomatic menopause, dentofacial deformities, asthma, or dermatologic disorders. Conclusions. WTP/QALY ratios calculated using preference data collected from diverse populations are lower than most proposed thresholds for determining what is "cost-effective." Current proposed cost-effectiveness ratio thresholds may overestimate the willingness of society to pay for medical interventions.

Original languageEnglish (US)
Pages (from-to)667-677
Number of pages11
JournalMedical Decision Making
Issue number6
StatePublished - Nov 2005
Externally publishedYes


  • Cost-effectiveness analysis
  • Preferences
  • QALYs
  • Utility
  • Willingness to pay

ASJC Scopus subject areas

  • Health Policy


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