1612? Human Capital Development HCD Working Papers The Disability-Adjusted Life Year (DALY) Definition, Measurement and Potential Use Nura Homedes. July 1996 HCDWP 68 Papers in this series are not formal publications of the World Bank. They present preliminary and unpolished results of analysis that are circulated to encourage discussion and comment; citation and the use of such a paper should take account of its provisional character. The findings, interpretations, and conclusions expressed in this paper are entirely those of the author(s) and should not be attributed in any manner to the World Bank, to its affiliated organizations, or to members of its Board of Executive Directors or the countries they represent. The Disability-Adjusted Life Year (DALY) Definition, Measurement and Potential Use* by Nulia Homedes * This paper is based on a presentation made at the European Bioethics conference that took place in October 1995 at the "Institut Borja de Bioetica" in Sant Cugat del Valles, Spain. The examples have been written by Cesar Revoredo. Abstract The 1993 World Development Report (WDR), "Investing in Health," used the Disability Adjusted Life Year (DALY) to measure the state of health of a population and, together with the concept of cost-effectiveness, to judge which interventions to improve health deserve the highest priority for action. The Disability Adjusted Life Year is the only quantitative indicator of burden of disease that reflects the total amount of healthy life lost, to all causes, whether from premature mortality or from some degree of disability during a period of time. This paper describes the methodology used in the WDR to calculate DALYs and how they can be used for setting health service priorities. Contents Values Incorporated in the DALY Indicator .....................................................2 Procedure to Calculate DALYs..4 Case 1: DALYs Lost Due to Immediate Death ...................................................5 Case 2: DALYs Lost Due to Death Following Disability ...................................................6 Case 3: DALYs Lost Due to Permanent Disability ....................................................8 Case 4: DALYs Lost Due to Disability Followed by Complete Recovery ........................................8 Data Needed to Estimate the Burden of Disease .....................................................9 Cost-Effectiveness ..................................................... 10 Data Needed to Estimate Cost-Effectiveness ..................................................... 12 Conclusion ..................................................... 13 References .................................................... 16 The principal suggestion of the 1993 World Development Report (WDR) "Investing in Health' (World Bank, 1993) is to define a package of essential health services, where everything not specified in the package is considered discretionary. The package should never include a less cost-effective intervention if a more cost-effective one is not financed. The line between the essential and discretionary interventions is drawn primarily on the basis of their cost-effectiveness. Exactly where the line is drawn can not be derived from the methodology, it must depend, among other things, on the country's epidemiological situation and on the willingness and ability to pay for health care. To measure the state of health of a population and, together with the related concept of cost- effectiveness, to judge which interventions to improve health deserve the highest priority for public action, "Investing in Health" makes extensive use of the concept of the Disability-Adjusted Life Year (DALY). The DALY has emerged as a measure of the burden of disease and it reflects the total amount of healthy life lost, to all causes, whether from premature mortality or from some degree of disability during a period of time. These disabilities can be physical or mental. The intended use of the DALY is to assist (i) in setting health service priorities; (ii) in identifying disadvantaged groups and targeting of health interventions; and (iii) in providing a comparable measure of output for intervention, program and sector evaluation and planning. The number of DALYs estimated at any moment reflect the amount of health care already being provided to the population, as well as the effects of all other actions which protect or damage health. Where treatment is possible---whether preventive, curative or palliative-the effectiveness of the intervention is the reduction in disease burden which the treatment produces. Effectiveness is measured in the same units (DALYs) as disease burden, and so can be compared across interventions which treat different problems and produce different outcomes. In other words, the DALY can be used to measure the gains in health attributable to different actions and add them up. The proponents of the DALY use this measure for two purposes: (i) to measure the burden of disease, and (ii) to increase the allocative efficiency of the sector by identifying health interventions that, for a given budget, will purchase the largest improvement in health, as measured by the burden of disease indicator (DALY). 2 Values Incorporated in the DALY Indicator The five key social preferences or values that are incorporated into the indicator of burden of disease "DALY" are the following: * Duration of time lost due to a death at each age, which is used to measure years of life lost due to premature mortality (or the number of years of life gained by averting death). This measurement requires defining the potential limit of life; in the case of DALYs, standard years of life lost are used. The standard has been chosen to match the highest national life expectancy observed, which is that of Japanese women (82 years). For a specific standard, the expectations are based on model life-table West Level 26, which has a life expectancy at birth for females of 82.5. The potential life expectancy at birth for males has been set at 80.1 • Disability weights or degrees of incapacity or suffering associated with different non-fatal conditions, which are necessary to make comparisons across diseases, as well as for comparing time lived with a disability with time lost due to premature mortality. Six disability classes measuring the extent of loss of physical functioning associated with a certain condition were defined. Subsequently, a group of independent experts established a weight, ranging from 0 (perfect health) to 1 (death), for each of the six disability classes.2 * Age-weights, which indicate the relative importance of healthy life at different ages. The age weights used in the World Bank report rise from birth until age 25 and decline slowly 1 The average gender differences in life expectancy at birth in low mortality populations is 7.2 years. Not all of this difference is biological; a large share is due to injuy deaths among young males and higher levels of risk factors such as smoking In high income groups in low-mortality population this gap narrows. Projecting this forward, the ultimnate gap in the life expectancy at birh between the sexes is likely to approach 2 or 3 years; that is, life expectancy for men would be around 80 years. 2 Note that the disability weights do not take account of the way in which individual and social resources compensate for the level of disability experienced. 3 thereafter. According to the World Health Organization (1994), the formula to calculate those weights is: Age - Weighting Function = Cx e1* Where: C = Constant equal to 0.16243. B Constant equal to 0.04. x Age. e Constant equal to 2.71 Tinme preference, which is the value of health gains today compared to the value attached to health gains in the future (in standard economic theory, the latter is assumed to be lower than the former). It is standard practice in economic appraisal of projects to use the discount rate to discount benefits in the future. The process of discounting future benefits converts them into net present-value terms; these benefits can then be compared with project costs (also discounted if they are spread over more than one year) to determine cost-effectiveness. The discount rate used in the DALY formula is 3 percent.3 The formula to discount for time preference is: Discounting Function = e