Patsi Sinnott, PT, PhD, MPH

HERC Economics Course 

May 14, 2014 

Introduction to 

QALYs and Preference 

Measurement in CEA
Overview 

 Brief review of the ICER 

 Outcomes in CEA 

 Concept of QALYs for a CEA 

 Estimating QALYs

 Guidelines on selecting measures 

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The ICER

CEA compares the outcomes and costs 

of two (or more) interventions 

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( study usualcare )

study usual care

Outcomes Outcomes

CostCost

−

( − )
Policy Implications

 Who is your audience? 

 How will the results be used? 

 What perspective should you use? 

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CEA/CUA review

 CEA compares the outcomes and costs of 

two (or more) interventions; 

– The outcome is defined by the health benefit 

achieved with the intervention.

– The outcome (s) are quantified in a single 

scale

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Scenario 

 Intervention to reduce/eliminate post-op 

infections in patients following hip fracture 

repair

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What costs to include?

7 
What outcomes to use?

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Scenario 

 Intervention to reduce/eliminate post-op 

infections in patients following hip fracture 

repair

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Outcomes for CEA

 Perspective – Hospital system (payer)? 

– Natural units present in both groups

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Outcomes for CEA

 Perspective – Societal? 

– Quantifies length of illness/life

– Quality of life

– Measured in both groups

– Comparable across programs

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The Quality Adjusted Life Year 

(QALY) 

 Describes duration of illness/years of 

survival, adjusted for quality of life 

experienced during that survival. 

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QALYs Overview

 You have 1 year in perfect health = 1 

QALY

 I have 1 year in “good” health (.80 

QALY)

 1 year difference = .20 QALYs 

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Estimation of QALYs

 Requires: 

– Description of the health states experienced 

by patients/subjects 

– Estimation of the duration of each health 

state

– Comparison to or assessment of individual 

or community preferences for each health 

state

– Standardized to 1 year

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QALY Example

Prophylactic antibiotic Rx vs. standard of care

Weights range from 0-1 

3 mo. 3 mo. 3 mo. 3 mo. Total QALYs

New 

Txt. 

.50 

(.50 x .25)

.125 

.60 

(.60 x .25)

.15 

.80 

(.80 x .25)

.20 

.80 

(.80 x .25)

.20 

(.125+.15+.20+.20) 

=.675

UC

.50 

(.50 x .25)

.125 

.35 

(.35 x .25)

.0875 

.50 

(.50 x .25)

.125 

.80 

(.80 x .25)

.20 

(.125+.0875+.125+.20) 

=.5375 
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Calculating cost/QALY 

 ICER – New Rx vs. standard care 

(hypothetical all other costs are equal)

/727,72$ QALY 1375.

000,10$

)5375.675(.

)0000,10($

== −

−
Deriving preferences or utilities for 

health states

 Basic methodology:

– Individuals provide a personal reflection on 

the relative value (preference weight) of 

different health states experienced or 

described.

 Patients

 Providers

 Community Sample

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Deriving preferences or utilities

 Three methods to derive preferences:

– Off the shelf

– Direct: 

– Indirect: 

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Off-the-shelf values

 Use preference weight determined in 

another study for health state of interest 

– Not all health states have been characterized

 Useful in decision modeling 

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Direct methods

 Individuals asked to choose (declare 

preferences) between their current health 

state and alternative health status 

scenarios 

 Individuals make these choices based on 

their own comprehensive health states (at 

the time of measurement)

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How are you today?

 You are able to see, hear and speak normally

 You require the help of another person and a 

cane to walk or get around.

 You are occasionally angry, irritable, anxious 

and depressed.

 You are able to learn and remember normally.

 You are able to eat, bathe, dress and use the 

toilet normally.

 You are free of pain and discomfort.

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Direct: Standard Gamble (SG)

 Live rest of life in 

current health state; 

or

 “take a pill (with 

risks) to be restored 

to perfect health”

 Scale represents risk 

of death respondent 

is willing to bear in 

order to be restored 

to full health.

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Considering the health state 

described 

 What risk of death would you be willing 

to take (by taking a pill, etc.) to be 

restored to (your ) perfect health 

 10%? 

 20% 

 0% 

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Direct method: time trade-off

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Value

Years of life

0 t1 t2 

Current health
Considering the health state 

described 

 How many years of life in your current 

state would you be willing to give up to 

live out your life in perfect health?

 5 years 

 10 years 

 Any years? 

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Direct Methods (SG, TTO)

 May be necessary if effects of 

intervention are complex:

– Multiple domains

– Effects not captured in indirect or diseasespecific instruments

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Direct Method (SG, TTO)

 High variance in estimates from patients 

in a trial 

– Reflect risk aversion, feeling about 

disability 

– High variance = large sample size

 Not the “community value” specified by 

Gold et al 

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Indirect Methods

 Study subjects complete surveys at 

intervals during a study.

 Multiple domains of health

 Composite describes the health status of 

the respondent at that moment

 Composite state is linked to community 

results (or “weights”) 

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How are you today (#2)

 Which statements best describe you 

today? 

 Mobility: 

– No problems, some problems, extreme problems 

 Pain 

 Anxiety/depression

 Self-care

 Usual activity

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How many health states?

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Indirect Measures

 Health Utility Index (HUI)

 EuroQol (EQ-5D) 

 Quality of Well-Being Scale (QWB)

 SF-6D 

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Indirect measures vary in:

 Dimensions or attributes included; 

 The size and nationality of the sample 

population used to establish the weights;

 Health states defined by the survey; and

 How the summary score is calculated, 

etc. 

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Indirect measures 

 Standard surveys that are widely used

 Describe generic health states

 May lack “responsiveness ” 

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Health Utility Index (HUI)

 41 questions (many items can be skipped)

– can derive both HUI Mark 2 and HUI Mark 3 

health utility scores.

 8 domains of health and 972,000 health states

– vision, hearing, speech, ambulation, dexterity, 

emotion, cognition, and pain

 Basis of domain weights:

– Canadian community sample rated hypothetical 

health states

– Utility theory

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EuroQol EQ-5D

 5 questions in 5 domains of health 

– Mobility, self-care, usual activity, pain/discomfort, 

or anxiety/depression

– 245 health states.

 Basis of domain weights: 

– Past studies based on British community sample 

– New US weights recently published

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The QWB 

Quality of Well-Being Scale

 Two versions 

– Interviewer or self-administered (QWB-SA)

 QWB-SA is more feasible

– 76 questions; 1215 health states defined;

– Includes symptoms, mobility, physical 

activity, & social activity

 Basis of domain weights: 

– Primary care patients in San Diego, CA

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SF-6D* 

 Converts SF-36 or SF-12 scores to 

utilities

– When based on SF-36, uses 10 items

– When based on SF-12, uses 7 items

 6 health domains 

– physical functioning, role limitations, social 

functioning, pain, mental health, and vitality

 Defines 18,000 health states 

 Basis of domain weights 

– British community sample

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Disease-specific surveys

 When to use? 

 How to use?

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Disease-specific surveys

 Key methods issues: 

– Difficult to describe health state to 

community respondent

– Difficult to establish values when there are a 

large number of possible health states 

 Expensive, but potentially sensitive to 

variations in quality of life for this 

disease 

 Often used in addition to generic measure 

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Which method to use?

 Trade-off between sensitivity and 

burden 

 Start with a literature search re: 

– the condition of interest

– In the population of interest

– For the outcomes of interest

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Hierarchy of methods 

 Off-the-shelf utility values

 Indirect Measures (HUI, EQ-5D, 

QWB, SF-6D) 

 Disease-specific survey during trial 

and transform later to preferences

 Direct measures (SG, TTO)

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Important Resources 

 Tufts Center for Risk Assessment 

– http://research.tufts-nemc.org/cear4

 National Institute for Health Research, 

UK

– http://www.nets.nihr.ac.uk/

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Important Resources

 Brazier J, Deverill M, Green C, Harper R, Booth A. 

A Review of the use of health status measures in 

economic evaluation. Health Technol. Assess 

1999;3(9).

– http://www.nets.nihr.ac.uk/projects/hta/934708

 Brazier et al. Developing and testing methods for 

deriving preference-based measures of health from 

condition-specific measures (and other patient-based 

measures of outcome). 

http://www.nets.nihr.ac.uk/projects/hta/069704

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Important Resources

 Table of published utility weights (preferences) for 

different health states 

– https://research.tuftsnemc.org/cear4/SearchingtheCEARegistry/Searcht

heCEARegistry.aspx

 Preference Measurement in Economic Analysis. 

Guidebook. VA Health Economics Resource Center.

– http://www.herc.research.va.gov/publications/guid

ebooks.asp

44 
 QUESTIONS and COMMENTS

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