TIME PREFERENCE IN MEDICAL DECISION-MAKING AND COST-EFFECTIVENESS ANALYSIS

Cost-effectiveness analyses usually quantify peoples' attitudes toward s delayed outcomes using the exponential discount model. The authors e xamined three assumptions of this model by assessing the time preferen ces of individuals towards hypothetical health states and calculating implicit annual discount rates. Of a random sample of medical students , house officers, and attending physicians, 121 participated, reflecti ng a response rate of 81%. The participants considered three temporary events (colostomy, blindness, depression) that were destined to occur at five sequentially distant times in the future (one day, six months , one year, five years, and ten years). The utility of each prospect w as measured using two elicitation techniques (standard gamble and cate gorical scaling), and 1,394 implicit discount rates were calculated. O f all the discount rates, 62.1% equalled zero, 10.0% were less than 0. 00, and 15.7% were greater than 0.10. Mean discount rates for relative ly proximal time intervals tended to be larger than those for relative ly more distant intervals (0.041 vs. 0.025, p < 0.01). Mean discount r ates for blindness tended to be smaller than those for colostomy or de pression (0.023 vs 0.039 vs 0.037, respectively, p < 0.005). Hence, pe oples' implicit discount rates are not always small positive numbers t hat are constant over time and the same for all settings. The authors suggest that the conventional exponential discount model may not fully characterize the time preferences held by individuals.