Consistent valuation of a reduction in mortality risk using values per life, life year, and quality‐adjusted life year

The monetary value of a reduction in mortality risk can be accurately characterized using the alternative concepts of value per statistical life (VSL), value per statistical life year (VSLY), and value per quality‐adjusted life year (VQALY). Typically, each of these values depends on the age and other characteristics of the affected individual; at most one of the values can be independent of age. The common practice of valuing a transient or persistent risk reduction using a constant VSL, VSLY, or VQALY yields systematic differences in the calculated monetary value that depend on the age at which the risk reduction begins, its duration, time path, and whether future lives, life years, or quality‐adjusted life years are discounted. Mutually consistent, age‐dependent VSL, VSLY, and VQALY are derived and the large differences in valuation of illustrative transient and persistent risk reductions that can result from assuming age‐independent values of each of the three concepts are illustrated.