Quality-adjusted life years – what is a QALY and why should we care?

Quality-adjusted life years – what is a QALY and why should we care?

What is a QALY?

The quality-adjusted life year (QALY) has been an area of great confusion and misunderstanding in the past years. People find the QALY hard to interpret, but put simply, QALYs are a useful way of comparing the value of one medical intervention to another. They convert effectiveness into a common measure of value.

NICE defines the QALY as ‘a measure of the state of health of a person or group in which the benefits, in terms of length of life, are adjusted to reflect the quality of life’ (NICE, 2016). In other words, a QALY considers both the quality and quantity of life generated by a healthcare intervention. It is a tool used by health economists to compare the effectiveness of medical products or treatments. QALYs are part of the process for calculating if a medical intervention is cost-effective.

To generate QALYs, health utilities (or health-related quality of life (HRQoL) weights) are needed. Utilities are preference weights, where preference can be equated with value or desirability. In the UK, NICE sets thresholds to determine whether a treatment is cost-effective and may therefore be made available on the NHS. NICE has a £20,000 cost per QALY threshold, with treatments with a cost per QALY over this amount less likely to be made available on the NHS. Similarly in Ireland, the National Centre for Pharmacoeconomics (NCPE) has a €45,000 cost per QALY threshold on medicines and other treatments. 

Why should we care?

When making decisions about how to allocate healthcare resources across many different interventions and patient groups it can be difficult to compare benefits. The QALY provides a means of comparing interventions. It combines quality of life and length of life into a single index measure. QALYs give us a common unit of benefit which we can then use in economic evaluations to compare interventions both within and between clinical areas.

QALYs impact everyone, directly or indirectly. The rationale for the QALY is that healthcare should impact on the quality of health status, the duration of time spent in that health status or both. The main reason why we should care so much about QALYs is that healthcare resources are limited, and health services want to spend limited resources in a manner which will maximise the benefits to society.

Tina Moloney

Associate Consultant, Market Access and Pricing Strategy
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