Willingness to Pay

The development of methods to measure willingness to pay (WTP) has renewed interest in cost-benefit analysis (CBA) for the economic evaluation of health care programs. The authors studied the construct validity and test-retest reliability of WTP as a measure of health state preferences in a survey of 102 persons (mean age 62 years; 54% male) who had chronic lung disease (forced expiratory volume <70%). Interview measurements in cluded self-reported symptoms, the oxygen-cost diagram for dyspnea, Short-Form 36 for general health status, rating scale and standard gamble for value and utility of current health state relative to death and healthy lung functioning, and WTP for a hypothetical intervention offering a 99% chance of healthy lung functioning and a 1% chance of death. WTP was elicited by a simple bidding game. To test for starting-point bias, the respondents were randomly assigned to one of five starting bids. All health status and preference measurements except WTP (controlling for income) showed significant (p < 0.05) differences between disease-severity groups (mild/moderate/severe). WTP was significantly (p = 0.01) associ ated with household income, but other health status and preference measures were not. The measure most highly correlated with WTP was standard gamble (r = -0.46). There was no association between starting bid and mean WTP adjusted for income and health status. The test-retest reliability of WTP was acceptable (r = 0.66) but lower than that for the standard gamble (r = 0.82). It is concluded that: 1) large variation in WTP responses may compromise this measure's discriminant validity; 2) there is some evidence of convergent validity for WTP with preferences measured by standard gamble; 3) there was no evidence of starting point bias; 4) the test-retest reliability of WTP is comparable to those of other preference measures. Key words: willingness to pay; health state preferences; economics. (Med Decis Making 1994;14:289-297)