QALYs, HYEs and individual preferences--a graphical illustration

Area of Science:

• Health Economics
• Decision Science
• Outcome Measurement

Background:

• Cost-utility analysis relies on robust outcome measures.
• Quality-adjusted life-years (QALYs) and healthy-years equivalents (HYEs) are debated measures.
• Theoretical underpinnings of QALYs and HYEs require clarification.

Purpose of the Study:

• To graphically illustrate the underlying preference assumptions of QALYs and HYEs.
• To analyze the theoretical properties of these outcome measures in cost-utility analysis.
• To compare the validity and ranking properties of QALYs and HYEs.

Main Methods:

• Graphical illustration of utility independence and trade-off assumptions.
• Explanation of risk neutrality and risk posture in utility functions.
• Comparison of standard gamble and time-trade-off methods for QALYs and HYEs.

Main Results:

• Mutual utility independence and constant proportional trade-off justify QALY assumptions.
• Risk-neutral QALYs are valid under specific risk neutrality conditions.
• HYEs require less restrictive risk neutrality assumptions for validity.
• The two-stage HYE measurement aligns with the time-trade-off method.
• Certainty-equivalent HYEs can theoretically rank risky health profiles.

Conclusions:

• Understanding the theoretical assumptions of QALYs and HYEs is crucial for accurate cost-utility analysis.
• Graphical methods effectively demonstrate the implications of different preference assumptions.
• Further empirical research is recommended to validate the ranking properties of these measures.