Health

How Much is Your Life Worth? Ask the U.S. Government

| by Reason Foundation

Want to know how much a year of your life is worth in cold, dollar terms? Just ask the government! And not only will they give you the value of your life, they'll tell you the value of everyone else's—because in the government's view, they're all the same. Sound frightening? It should. But if Princeton bioethics professor Peter Singer gets his way, that's essentially what will happen.

In a long article in the New York Times Magazine, Singer argues that, because it's a scarce resource, we must ration health-care. I actually agree. Where I depart from Singer, however, is that I think that, as much as is possible, rationing shouldn't be done by the government.

Singer's essay is basically just a long-form defense of the QALY (quality adjusted life-year) measure that government review boards like Britain's National Institute for Health and Clinical Excellence (NICE) use to determine what treatments ought to be funded. Governments that determine treatments using the QALY assign a dollar value to a year of perfect health (in Britain, it's about $50,000 a year) and then generally reject treatments that don't provide enough value.

This means, among other things, that expensive treatments for older individuals are less likely to be funded. From a rational economic standpoint, spending, say, $200,000 to save the life of a 78-year-old only expected to live three more years really is less efficient than spending the same amount on a 30-year-old who's likely to live 40-some more years.

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What's wrong with this approach? Beyond the inevitable disputes between economists about what a year of life is actually worth, the bigger issue is that the QALY standard results in an essentially command-and-control approach to health-care distribution: Rather than let individual preferences and agreements work out prices and reach an equilibrium, the government simply sets the value of a year of good life for all people, without differentiating between them, and extrapolates from there.

I agree that, in the end, we do have to make economic decisions about the value of life. But shouldn't those be decisions made by individuals, their families, and their doctors? Do we really want bureaucrats in Washington handing down indiscriminate dictates on what a year of productive, healthy life is worth? Must everyone be blindly herded into the same pen?

To the extent that we have the government involved in health-care decision-making, we probably should expect some level of rational economic prioritizing. But this seems to me like an argument to keep the government out of these decisions as much as possible. Singer, on the other hand, argues that we should extend Medicare to all Americans, institute a QALY standard, and then let individuals buy supplemental insurance to cover any additional care they want. Never mind that in Britain and Canada, both of which use rationing boards, bureaucratic territoriality has made it extremely difficult to get private care, Singer's idea would still mean that most health-care decisions are made using the government's standardized, impersonal life-year valuation.
Singer, who's made his name as a contrarian bioethicist willing to take unpopular positions, seems to want credit for boldly admitting that we can come up with a dollar value to human life. But we all do this, implicitly, with every health-care and safety choice we make. The question isn't whether or not life can be assigned a value—it's who should do so.

Previously, I wrote about the problems with the QALY standard here.