How much is your life worth?

This is not a philosophical question.

In an article "Pinning down the money value of a person's life" in the New York Times, health economists try to answer the question of the price of health in determing whether a new treatment or medicine is worth the cost.

Studies of real world situations suggest that average Americans value a year of life at $100,000 - $300,000, according to Tufts - New England medical Centre that measures the cost-effectiveness of new treatments.

Healthcare economists have created the idea of "quality-adjusted life year" (QALY) - that a year in perfect health is worth more than a year spent in pain, depression or a wheelchair, with rough estimates and use them as guides to the diseases and conditions that people will spend the most to avoid, then rank the "costs" of various diseases to determine the worthiness of a particular treatment.

However, economists argue that the inefficiencies that contribute to the high cost of American healthcare will mean that the US will have to follow other countries such as Britain when considering the coverage of new treatments.

How much is a person's life worth in Britain?

NICE backed cancer-drug refund scheme

NICE backed the scheme that the NHS should pay for the bone marrow-cancer drug, Velcade, which costs about £18,000 per patient, only when it worked. Initially, NICE recommended that the drug should not be made available on the NHS, but changed its mind following an appeal by the drugmaker, Janssen-Cilag and its proposal of a refund scheme.

Last February, the OFT said in a report that drug companies are paid hundreds of millions of pounds too much by the NHS for branded medicines but it does not reflect the value of those drugs to patients.

OFT recommended value-based pricing would give companies stronger incentives to invest in drugs for those medical conditions where there is greatest need.