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Oregon's 1989 Medicaid Ranking Tested What a QALY Threshold Actually Does

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In 1989 the state of Oregon tried to put the quality-adjusted life year to a concrete political test, ranking the medical services its Medicaid program would cover by their expected QALY yield so administrators could draw a line and fund everything above it. Federal regulators found the plan discriminatory and in violation of the Americans with Disabilities Act in 1992. Louis W. Sullivan, then the United States Secretary of Health and Human Services, explained the objection directly: "Oregon's plan in substantial part values the life of a person with a disability less than the life of a person without a disability." The ranking undervalued treatments for conditions common among people who could never reach a QALY score near 1 no matter how successful the treatment, and Oregon had to redesign the plan before its Medicaid waiver could go forward. The measure's theoretical assumptions got their most direct empirical test between 2010 and 2013, when the European Commission funded a consortium called ECHOUTCOME to check whether real people's preferences actually match what QALY theory assumes about trading length of life against quality of life. The consortium surveyed 1,361 people across academic settings in Belgium, France, Italy and the United Kingdom, and its lead researcher, Ariel Beresniak, described it as the largest study ever built specifically to test the QALY's own assumptions. The finding: the preferences people actually expressed did not match what the QALY model assumes, and ECHOUTCOME's own published guidelines recommended against using QALYs in healthcare decisions at all, urging cost-effectiveness analysis built around specific clinical outcomes instead. The National Institute for Health and Care Excellence and the OECD pushed back, calling the sample limited and noting that the QALY's shortcomings were already well known before the study ran, but whether the QALY captures how people genuinely value health states, or only gives administrators a convenient single number to rank by, remains unresolved on both sides. 1
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1. Wikipedia: Quality-Adjusted Life Year
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Oregon's plan in substantial part values the life of a person with a disability less than the life of a person without a disability.
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