Healthcare Economics

Healthcare Economics

Quality-Adjusted Life Year

The measure of disease burden is known as the quality-adjusted life year (QALY). It includes both the quantity of the life, as well as, the quality of the life that is lived. Medical intervention's value for money is assessed using this measure. This measure is based on the number of years that are added by the intervention.

Keeping in mind the formula for calculating the quality-adjusted life year, (1 Year of Life × 1 Utility value = 1 QALY), it helps in determining the health status between a person who is healthy and one who is not. The assumption of this measure is that a person living in perfect health for a year, his worth is less than 1 QALY. This helps in knowing whether the person is in perfect health or not. This measure is calculated in terms of number of healthy years lived.

This measure can be used to compare health outcomes of someone who is ill with someone who has died. When the calculation is done, a person who is dead is assigned an arbitrary value of 0. When a person's health is ranked zero, it is clear that the person is dead. This will help the person who is calculating in deriving the best results and in helping to know that the person is alive or dead, and if he is alive what is his health status. This measure is very effective and has helped in getting the exact value that is related to their health.

Flat-of-the-Curve Medicine

A situation where the impact of the additional health care on the individual's health has dropped down to zero is known as the flat-of-the curve medicine. Health' marginal productivity is equal to zero. This occurs due to the concept of diminishing returns to scale or ...