[Modified cost-benefit analysis takes equity into consideration. Treatment of brain tumors is more cost-effective...

As health care resources are held to be insufficient to permit free choice of available treatment options, prioritizing is necessary. A precondition of careful prioritizing is comprehensive knowledge of the consequences, both for the patient and the community, of adopting each of the available options in a given case. A tool used in setting priorities is cost-benefit analysis, based on the utilitarian principle of health maximisation. However, it is evident from findings in recent studies that equity is widely considered a factor which ought to be included in the analysis. The article presents a method for correcting the variable, quality-adjusted life years (QALY), by introducing an equity factor, yielding a new variable, equity-adjusted QALY (EQALY). Use of the method is illustrated by comparison of the cost-effectiveness of two procedures, hip replacement and the treatment of malignant glioma, and showing how priority ranking of the two procedures is reversed if the EQALY variable is used instead of QALY.