What Does the Value of Modern Medicine Say About the $50,000 per Quality-Adjusted Life-Year Decision Rule?

TLDR

$50,000 per QALY is a commonly used US cost‑effectiveness threshold that has been questioned and not updated. The study aimed to test whether this threshold aligns with contemporary resource allocation by estimating lower and upper bounds for the rule. Researchers performed incremental cost‑effectiveness analyses comparing 2003 versus 1950 medical care and unsubsidized insurance versus self‑pay for adults 21‑64. Results indicate plausible bounds of $183,000–$264,000 per life‑year (or $109,000–$297,000 per QALY), far exceeding $50,000, making the rule inconsistent with societal preferences.

Abstract

In the United States, $50,000 per Quality-Adjusted Life-Year (QALY) is a decision rule that is often used to guide interpretation of cost-effectiveness analyses. However, many investigators have questioned the scientific basis of this rule, and it has not been updated.We used 2 separate approaches to investigate whether the $50,000 per QALY rule is consistent with current resource allocation decisions. To infer a lower bound for the decision rule, we estimated the incremental cost-effectiveness of recent (2003) versus pre-"modern era" (1950) medical care in the United States. To infer an upper bound for the decision rule, we estimated the incremental cost-effectiveness of unsubsidized health insurance versus self-pay for nonelderly adults (ages 21-64) without health insurance. We discounted both costs and benefits, following recommendations of the Panel on Cost-Effectiveness in Health and Medicine.Our base case analyses suggest that plausible lower and upper bounds for a cost-effectiveness decision rule are $183,000 per life-year and $264,000 per life-year, respectively. Our sensitivity analyses widen the plausible range (between $95,000 per life-year saved and $264,000 per life-year saved when we considered only health care's impact on quantity of life, and between $109,000 per QALY saved and $297,000 per QALY saved when we considered health care's impact on quality as well as quantity of life) but it remained substantially higher than $50,000 per QALY.It is very unlikely that $50,000 per QALY is consistent with societal preferences in the United States.