BACKGROUND: The intention of this thesis has been to investigate the functional form of the preferences for health – in particular whether or not the preferences for health are linear. The reason for this is because linear preferences for health (and health effects) is, according to authors in the field of economic evaluation, believed to be an assumption that underlies standard QALY analysis. Linear preferences can be said to imply two things: (i) that the marginal utility of additional health is constant. This means that the severity level in health before treatment will have no effect on the valuation of an additional unit of health (proportionality assumption), (ii) given linear preferences in health, individuals exposed to health risks will be risk-neutral meaning that they will be indifferent between two projects (a risky one and a non-risky one) with similar expected values.
METHODS: In this study, two groups of individuals were confronted with four hypothetical questions concerning choosing between competing treatments alternatives and competing insurance contracts, in order to reveal their preferences. The questionnaire was used among 33 employees at the National Institute of Public Health, together with 28 students at the Institute of Health Management and Health Economics, and the Institute of Economics. All questions were followed by a semi-structured interview.
RESULTS: In question 1, the respondents do not consider treatment potential as a crucial factor when asked to evaluate how strong desire for operation, in those who stand to gain only a little, compared to those who stand to gain more, even though there exist an mortality risk of 5 %. Furthermore, in question 2 and 3, the respondents were mainly concerned with avoiding the worst state, instead of maximizing individual benefit (treatment effect). Last, in question 4, equity concerns were revealed, and arguments about severity of illness were also identified. Overall, other factors, such as treatability, concerns for fairness, and goals in life were also emphasized.
CONCLUSION: Based on the questions given, it is difficult to draw any strong conclusions on whether or not preferences for health are linear, and also whether or not people show risk-averse behaviour.