The Value of a Human Life: $129,000 - Tilted Forum Project Discussion Community

Cynthetiq · 05-26-2008, 07:53 PM

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The Value of a Human Life: $129,000
Tuesday, May. 20, 2008
The Value of a Human Life: $129,000
By Kathleen Kingsbury

In theory, a year of human life is priceless. In reality, it's worth $50,000.

That's the international standard most private and government-run health insurance plans worldwide use to determine whether to cover a new medical procedure. More simply, insurance companies calculate that to make a treatment worth its cost, it must guarantee one year of "quality life" for $50,000 or less. New research, however, would argue that that figure is far too low.

Stanford economists have demonstrated that the average value of a year of quality human life is actually closer to about $129,000. To get to that number, Stefanos Zenios and his colleagues at Stanford Graduate School of Business used kidney dialysis as a benchmark. Every year dialysis saves the lives of hundreds of thousands of Americans who would otherwise die of renal failure while waiting for an organ transplant. It is also the one procedure that Medicare has covered unconditionally since 1972 despite rapid and sometimes expensive innovations in its administration. To tally the cost-effectiveness of such innovations Zenios and his colleagues ran a computer analysis of more than half a million patients who underwent dialysis, adding up costs and comparing that data to treatment outcomes. Considering both inflation and new technologies in dialysis, they arrived at $129,000 as a more appropriate threshold for deciding coverage. "That means that if Medicare paid an additional $129,000 to treat a group of patients, on average, group members would get one more quality-adjusted life year," Zenios says. Based on patient surveys, one "quality of life" year is defined as about two years of life on dialysis.

Zenios's conclusions arrive amidst mounting debate over whether Medicare, the U.S. government health plan for seniors, ought to use cost-effectiveness analysis in determining coverage of procedures. Nearly all other industrial nations — including Canada, Britain and the Netherlands — ration health care based on cost-effectiveness and the $50,000 threshold. Medicare, on the other hand, decides whether to pay for new technology based on whether a treatment is "medically necessary and appropriate." But as health care expenses rise and entitlement programs grow fiscally strapped — at least one part of Medicare is now expected to be bankrupt by 2019 — more and more academics have called for this approach to be reconsidered, and for cost to become a factor. Such a move would mean that "if the incremental cost of a new technology was more than the threshold," Zenios says, "then the recommendation would be that Medicare not cover that new technology."

Assigning a dollar figure to Medicare patients' lives may sound crass, but such valuations are routine in Americans' daily lives. Take, for example, the $500,000 death benefit the government pays families when a soldier is killed in Iraq or Afghanistan. Or the cost calculations that for-profit health insurers make to determine how much coverage they'll give customers. In fact, at least some Americans seem at ease with allowing money to play a prominent role in health care decisions. In a 2007 survey of New Yorkers, 75% of participants felt "somewhat" to "very" comfortable with allowing cost to inform Medicare treatment decisions, once they understood how the system worked. "Americans understand and are prepared to engage the issues that arise when setting priorities and limits for their public programs," Marthe Gold, the City University of New York Medical School professor who conducted the study, wrote with colleagues this past fall in the journal Health Affairs.

The Stanford researchers caution that if Medicare fully adopted a cost-benefit analysis model, too many patients could be denied life-saving treatment. They return to the example of dialysis patients. Their study showed that for the sickest patients, the average cost of an additional quality-of-life year was much higher — $488,000. "It is difficult to justify the burden and expense of dialysis when persons have other serious health conditions such as, for example, advanced dementia or cancer," says co-author Glenn Chertow, a nephrology professor at the Stanford School of Medicine. "In these settings, dialysis is unlikely to provide any meaningful benefit." But with organs including kidneys for transplant so scarce, is it justifiable to deny these patients a chance to live through dialysis? It is a question, Zenios says, everyone should approach with trepidation. "What is the true value of a human life? That's what we're asking people," he adds. "I wouldn't pretend to know."

Heck even FORD valued human life at a higher dollar amount...

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Remember, Ford had gotten the federal regulators to agree to talk auto safety in terms of cost-benefit analysis. But in order to be able to argue that various safety costs were greater than their benefits, Ford needed to have a dollar value figure for the "benefit." Rather than be so uncouth as to come up with such a price tag itself, the auto industry pressured the National Highway Traffic Safety Administration to do so. And in a 1972 report the agency decided a human life was worth $200,725. Inflationary forces have recently pushed the figure up to $278,000.

I didn't realize that Canada, UK, and the Netherlands ration heatlh care ration health care based on cost-effectiveness and the $50,000 threshold. I don't pretend to know the limitions of other state healthcares wherein people say the price drops per person, but IMO I'm trying to understand this assigned dollar value of human life.

Do you think that it's more in line with Ford? What employers do which is 7x your salary if killed at work, and 2x if killed at home? Is one life have a higher dollar value because of community stature, society position, job and the like?

I personally don't think that all life is equal on the dollar ladder. Some people who generate more "something" are worth more, whatever that "something" is. I assume that it's some sort of value or contribution to the community. Thus in some communities rabbis, priests, and other religious leaders may have a higher dollar value, but move them to an incongruent community and that value drops like a stone.

I do think that all life is precious, just if you are considering it into a dollar value, you've created an incongruent value system almost every single time.

blahblah454 · 05-26-2008, 07:59 PM

Thats per year, and who knows how many years a person had left in them.

This is kind of a tricky subject, but I suppose a line has to be drawn somewhere.

I agree with you about not everyone having the same "value". There are some that are most definitely more of a benefit to society than others. Why should some homeless crack addict be worth the same as a hard working member of society like myself? But companies have to throw something out there I suppose.

Willravel · 05-26-2008, 08:01 PM

As I understand it in places that do not have private healthcare, it's entirely different. Basically, one will simply receive treatment unless the procedure is considered to be cosmetic. Need a new heart? You're on the list. Need dialysis? You get it. These costs are balanced out by people who need very little treatment but still pay taxes.

I'll admit I have trouble understanding why one would support a system where someone is not allowed to get healthcare because it's too expensive. But that's just me.

Sion · 05-26-2008, 08:18 PM

perhaps this sort of valuation of human life wouldn't be necessary if more people would become organ donors. I think organ donation should be automatic, with the option to NOT be a donor. An Opt-Out system instead of an Opt-In one.

Willravel · 05-26-2008, 08:22 PM

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Originally Posted by Sion

perhaps this sort of valuation of human life wouldn't be necessary if more people would become organ donors. I think organ donation should be automatic, with the option to NOT be a donor. An Opt-Out system instead of an Opt-In one.

This is an absolutely fantastic idea.

blahblah454 · 05-26-2008, 08:58 PM

I don't understand why dead people even have a choice. Why not just take everyones organs if they can be used?

echo5delta · 05-26-2008, 09:18 PM

Although I'm very glad they've FINALLY nailed this down to a dollar amount, my real question is how much a mortal soul is worth.

Seriously, I have some budgeting to do and markers to call in. I need a number, dammit.

Willravel · 05-26-2008, 09:27 PM

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Originally Posted by blahblah454

I don't understand why dead people even have a choice. Why not just take everyones organs if they can be used?

It's against some people's interpretation of their religions. Also, some people are kinda selfish.

telekinetic · 05-26-2008, 10:00 PM

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Originally Posted by blahblah454

I don't understand why dead people even have a choice. Why not just take everyones organs if they can be used?

being kept braindead but 'alive' to harvest key organs gives some people the heebie-jeebies

Hain · 05-26-2008, 10:30 PM

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Originally Posted by Willravel

I'll admit I have trouble understanding why one would support a system where someone is not allowed to get healthcare because it's too expensive.

You got that right.

little_tippler · 05-27-2008, 05:52 PM

Quote:

Originally Posted by Sion

I think organ donation should be automatic, with the option to NOT be a donor. An Opt-Out system instead of an Opt-In one.

I've never looked into it, but as far as I am informed, that's how it works here in Portugal. You have to opt-out to not be an automatic donor.

Baraka_Guru · 05-27-2008, 05:57 PM

But the ROI on that life would be astounding.

05-26-2008, 08:18 PM	#4 (permalink)
Sion Dumb all over...a little ugly on the side Location: In the room where the giant fire puffer works, and the torture never stops.	perhaps this sort of valuation of human life wouldn't be necessary if more people would become organ donors. I think organ donation should be automatic, with the option to NOT be a donor. An Opt-Out system instead of an Opt-In one. __________________ He's the best, of course, of all the worst. Some wrong been done, he done it first. -fz I jus' want ta thank you...falettinme...be mice elf...agin...

05-26-2008, 09:18 PM	#7 (permalink)
echo5delta Crazy Location: Swamp Lagoon, North Cackalacky	Although I'm very glad they've FINALLY nailed this down to a dollar amount, my real question is how much a mortal soul is worth. Seriously, I have some budgeting to do and markers to call in. I need a number, dammit. __________________ "Peace" is when nobody's shooting. A "Just Peace" is when we get what we want. - Bill Mauldin

05-27-2008, 05:57 PM	#12 (permalink)
Baraka_Guru warrior bodhisattva Super Moderator Location: East-central Canada	But the ROI on that life would be astounding. __________________ Knowing that death is certain and that the time of death is uncertain, what's the most important thing? —Bhikkhuni Pema Chödrön Humankind cannot bear very much reality. —From "Burnt Norton," Four Quartets (1936), T. S. Eliot

05-26-2008, 07:59 PM	#2 (permalink)
blahblah454 Let's put a smile on that face Location: On the road...	Thats per year, and who knows how many years a person had left in them. This is kind of a tricky subject, but I suppose a line has to be drawn somewhere. I agree with you about not everyone having the same "value". There are some that are most definitely more of a benefit to society than others. Why should some homeless crack addict be worth the same as a hard working member of society like myself? But companies have to throw something out there I suppose.

05-26-2008, 08:01 PM	#3 (permalink)
Willravel ... a sort of licensed troubleshooter.	As I understand it in places that do not have private healthcare, it's entirely different. Basically, one will simply receive treatment unless the procedure is considered to be cosmetic. Need a new heart? You're on the list. Need dialysis? You get it. These costs are balanced out by people who need very little treatment but still pay taxes. I'll admit I have trouble understanding why one would support a system where someone is not allowed to get healthcare because it's too expensive. But that's just me.

05-26-2008, 08:58 PM	#6 (permalink)
blahblah454 Let's put a smile on that face Location: On the road...	I don't understand why dead people even have a choice. Why not just take everyones organs if they can be used?