February 27, 2005

QALY Control

In the New York Times today, Daniel Altman suggests one way to decrease medical costs: let old people die off earlier. No, really:
For the last few decades, the share of Medicare costs incurred by patients in their last year of life has stayed at about 28 percent, said Dr. Gail R. Wilensky, a senior fellow at Project HOPE who previously ran Medicare and Medicaid. Thus end-of-life care hasn't contributed unduly of late to Medicare's problems. But that doesn't mean it shouldn't be part of the solution. "If you take the assumption that you want to go where the money is, it's a reasonable place to look," Dr. Wilensky said.

End-of-life care may also be a useful focus because, in some cases, efforts to prolong life may end up only prolonging suffering. In such cases, reducing pain may be a better use of resources than heroic attempts to save lives.
Rationing health care is, of course, hardly a new idea, but this particular debate never gets much attention. One of the concepts implicit here—though not mentioned in Altman's piece—is the notion of quality-adjusted life years (QALYs), a metric that help us compare the cost-effectiveness of certain treatments. Some treatments obviously are very cost-effective at adding QALYs, like vaccinations. Others—like the sort of expensive "Hail Mary" treatments used on seniors at their lifes' end—may cost more and yield fewer QALYs. Thanks to shiny new medical technology, we can extend people's lives longer and longer, but you don't get quite as many QALYs for your buck. You can think of it—and I saw this graphed out somewhere in Health Affairs once—as a supply curve. The U.S. is very high up on the curve, higher than any other country, and pays a lot more for each additional QALY, but in the end doesn't get very many more QALYs for its buck.

In a sense, this is just a technical way of saying what Altman's describing: The U.S. spends much more on expensive end-of-life treatments that buys maybe a few more months (or whatever) of not-very-high-quality life.

So there's a simple economics question here that has a lot—a lot—of moral significance: How far up the QALY curve do we want to go? Britain, as I recall, caps public funding at some price X per QALY. Say it's $30,000 ( I really don't remember). So if you go in for expensive surgery that's expected to cost, say, $300,000 but is expected to extend your life by 10 quality-adjusted life years, that's fine. On the other hand, if some procedure costs $20,000 and is only expected to extend your life by a month, then the government won't pay for it. No one else has gone this route, I think, but at some point we may need to consider it. Private companies, too, may need to start considering it. The other question—at least for publicly-funded programs like Medicare—is whether wealthy people will be allowed to pay out-of-pocket for treatments that go over the cap (they can in Britain).
-- Brad Plumer 11:48 PM || ||