Christian Vercler is a Clinical Associate Professor of Pediatric Plastic Surgery at the University of Michigan C.S. Mott Children’s Hospital. He is a service chief of the Clinical Ethics Service in the Center for Bioethics and Social Sciences in Medicine (CBSSM). Dr. Vercler has a special interest in ethics in surgery and he holds master's degrees in both Theology and Bioethics. He has a passion for teaching medical students and residents and has won teaching awards from Emory University Medical School, Harvard Medical School, and the University of Michigan.
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Do you think that your life is worth more than the amount that the government usually uses as the maximum to spend to provide one year of life?
Imagine that you are a member of a government panel that is trying to decide how cost-effective a medical treatment must be in order for the government to cover the costs of the treatment. Suppose that a certain treatment could provide one additional year of life to an otherwise healthy person. What is the highest amount the government should be willing to pay per person for this treatment?
How do your answers compare?
For the past twenty years, the figure most often used as the maximum amount to spend to provide one year of life has been $50,000. This figure was originally proposed since it was the cost of a year of kidney dialysis, a lifesaving treatment that the U.S. government funds in Medicare.
Should the number be higher or lower than the current standard?
Conventional wisdom would suggest that the number be higher to take into account the inflation that has occurred in the years since the standard was developed. Current practices such as annual Pap smear screening for women with low risk for cervical cancer, which has a cost of $700,000 per year of life gained, also suggest that society is willing to pay more than the current standard for a year of life. The authors of the cited article recommend, based on current treatment practices and surveys of the general public, that the cost-effectiveness threshold should be revised to be around $200,000.
Should the number increase, decrease, or stay the same over time?
Again, it seems that the threshold amount should increase over time due to inflation. However, other factors come in to play that affect the value.
Since new technologies are emerging all the time, some of which will be deemed cost-effective, there will be more and more treatments to be offered in the future. Also, the rate of use of treatments is an important consideration, because even if a new treatment is more cost-effective than an old one, if it is used more often it will end up costing more to society overall. With more treatments becoming available and more people being given treatments, the threshold cost will probably have to decrease so that insurance companies and the government can keep up with the increasing availability and demand.
Why is this important?
Insurance companies and government health care entities face a continuing struggle when trying to determine which medical treatments to cover. Health care costs are increasing rapidly, so these groups will be facing even tougher decisions in the future. Establishing cost-effectiveness guidelines would be extremely helpful as an aid to making the decisions about treatment coverage. Evidence shows that the current threshold is probably not an accurate reflection of the desires of society or actual prescribing practices. It needs to be adjusted to become useful once again, and must be reevaluated periodically to make sure the value keeps up with trends in the health care market, rather than being left alone without question for two decades as is the current situation.
For more information see:
Ubel PA, Hirth RA, Chernew ME, Fendrick AM. What is the price of life and why doesn't it increase at the rate of inflation? Archives of Internal Medicine. 163:1637-1641, 2003.
Reshma Jagsi, MD, DPhil, is Professor, Deputy Chair, and Residency Program Director in the Department of Radiation Oncology and Director of the Center for Bioethics and Social Sciences in Medicine at the University of Michigan.
She graduated first in her class from Harvard College and then pursued her medical training at Harvard Medical School. She also served as a fellow in the Center for Ethics at Harvard University and completed her doctorate in Social Policy at Oxford University as a Marshall Scholar.
Joel D. Howell is a Professor at the University of Michigan in the departments of Internal Medicine (Medical School), Health Management and Policy (School of Public Health), and History (College of Literature, Science, and the Arts), as well as the Victor C. Vaughan Professor of the History of Medicine. He received his M.D. at the University of Chicago, and stayed at that institution for his internship and residency in internal medicine. At the University of Pennsylvania, he was a Robert Wood Johnson Clinical Scholar, and received his Ph.D. in the History and Sociology of Science.
Andrew G. Shuman, MD is an Assistant Professor in the Department of Otolaryngology - Head and Neck Surgery at the University of Michigan Medical School. He is also the Chief of the ENT Section of the Surgery Service at the VA Ann Arbor Health System. He is a service chief of the Clinical Ethics Service in the Center for Bioethics and Social Sciences in Medicine (CBSSM). His current research interests explore ethical issues involved in caring for patients with head and neck cancer, and in managing clinical ethics consultations among patients with cancer.
Dr. Jeff Kullgren is a Research Scientist in the Center for Clinical Management Research at the VA Ann Arbor Healthcare System and an Assistant Professor in the Department of Internal Medicine at the University of Michigan Medical School and Institute for Healthcare Policy and Innovation. Dr.
I serve as Professor of Family Medicine, Director of Japanese Family Health Program, and Co-Director of the Michigan Mixed Methods Research and Scholarship Program at the University of Michigan. In addition to being a family/general doctor fluent in Japanese, I have long been interested in the influence of culture on medical decision making and ethics, and have conducted numerous health research projects, and published numerous papers in English and Japanese.
Dr. Langa is the Cyrus Sturgis Professor in the Department of Internal Medicine and Institute for Social Research, a Research Scientist in the Veterans Affairs Center for Clinical Management Research, and an Associate Director of the Institute of Gerontology, all at the University of Michigan. He is also Associate Director of the Health and Retirement Study (HRS), a National Institute on Aging funded longitudinal study of 20,000 adults in the United States ( http://hrsonline.isr.umich.edu ).