We’re extending our lives, but at what price?
How much is an extra year of your life worth?
That blunt inquiry is at the heart of a Rand Corp. study to be published today, and the answers are sobering.
The well-known think tank found that costly future treatments such as improved defibrillators or drugs for Alzheimer’s disease pose great financial risk to the Medicare program.
For instance, the study found that new pacemakers could cost Medicare and other insurers $1.4 million for every extra year of life they add. In comparison, healthcare economists often use $100,000 per added year of life as the maximum of benefit worth paying by the government insurer. In another example, the study predicted the use of tumor-strangling drugs would mean $498,809 per additional life-year.
Dana Goldman, the study’s lead author and Rand’s director of health economics, says the conclusions cut across the conventional wisdom that the biggest risk to Medicare is the aging of the US population.
Goldman said his study shows that the unforeseen costs of new technologies might be an even more difficult problem because they are less predictable.