CVEN9892 Chap.7 DALYs and Life Cycle Costing
DALYs and Life Cycle Costing
This chapter combines premature mortality and non-fatal disability into disability-adjusted life years while keeping the two components visible. It also contrasts health burden with life-cycle cost, which follows capital, operation, maintenance, replacement and end-of-life cash flows over a shared service horizon. Integration requires an explicit decision framework because years and dollars are not physically additive.
A disability-adjusted life year represents one healthy life-year lost in an assessed population. Years of life lost are calculated from expected deaths and remaining standard life expectancy. Years lived with disability are calculated from cases, health-state duration in years and a disability weight representing severity during that state. Calculate these components separately before adding them.
This makes the main burden pathway visible and exposes double counting. A disability weight is not a disease probability and should not be multiplied by risk unless the case or expected-case calculation is already clear. Convert days or weeks of illness into years before calculating YLD. State whether case counts are observed, expected from a risk model or projected under a scenario.
For mortality, identify the life-expectancy convention and check whether deaths are already represented within another composite outcome. The population and time basis must travel with the result. A total DALY per year for a small community is different from a rate per 100,000 people per year. Normalisation can support comparison, but it does not change the underlying expected burden into an individual prognosis.
Report uncertainty in incidence, duration, severity and deaths, particularly when a small mortality probability drives most of the total. Life-cycle costing asks a parallel but financially distinct question. Define an equal service horizon for every option, then list acquisition, construction, operation, energy, maintenance, replacement, downtime and end-of-life cash flows.
State the currency year and whether totals are discounted. Purchase price alone is misleading when lifetimes and operating costs differ. Build a time line so replacement events and residual value can be checked. Sensitivity analysis should vary lifetime, maintenance frequency, energy price or discount assumptions that can change the ranking.
DALYs and dollars must remain separate unless an explicit decision framework connects them. Cost-effectiveness can compare incremental cost with incremental health burden avoided, while MCDA can normalise and weight several consequences. Each approach introduces a decision rule that must be stated.
First calculate the difference between options over the same population and horizon, then disclose the threshold or preference used to interpret it. A sound recommendation identifies whether mortality or disability drives health burden, which cash flow drives cost and which uncertain input could reverse the choice.
It avoids adding unlike totals or presenting a small expected burden as a guaranteed outcome for a particular person.
What this chapter covers
- 01
Years of life lost
- 02
Years lived with disability
- 03
Disability weights
- 04
Population normalisation
- 05
Life-cycle cost
- 06
Service horizons
Worked example · free
Calculate an annual DALY burden
- +1Calculate YLD = 40 × 10/365 × 0.12 = 0.1315.
- +1Calculate YLL = 0.01 × 35 = 0.35.
- +1Sum to 0.4815 DALY/year.
- +1Identify mortality as the larger component and test inputs.
Key terms
- DALY
- A healthy life-year lost through premature mortality or disability.
- Years of life lost
- Expected deaths multiplied by remaining standard life expectancy.
- Years lived with disability
- Cases multiplied by health-state duration and disability weight.
- Life-cycle cost
- The costs of acquisition, operation, maintenance, replacement and end-of-life over a defined horizon.
- Incremental comparison
- The difference in cost and health burden between options evaluated for the same population, service and time horizon.
DALYs and Life Cycle Costing FAQ
What does one DALY mean?
One DALY represents one healthy year of life lost across the assessed population. It can arise from premature mortality, time lived with disability, or a combination of both across the whole population during the stated assessment period and scenario.
Is a disability weight a disease probability?
No. It represents severity during time lived in a health state. Probability or expected cases enters separately before duration and disability weight are applied to the population burden.
How should life-cycle costs be compared?
Use the same service horizon and discount convention for each option, include replacement and operating schedules, and test uncertain lifetime or maintenance assumptions that can change the ranking.
Exam move
Keep a two-column DALY template for YLL and YLD, including units and population basis. Recalculate durations from days to years until the conversion is automatic. For costing, draw a time line of capital, operation, maintenance and replacement cash flows. Practise explaining why DALYs and dollars need an explicit decision method before integration.
Label case counts as observed, expected or modelled and keep fractional expected deaths in their population context. Recalculate the same burden as a total and a rate per 100,000, preserving the annual horizon. For each option, build a cash-flow schedule with acquisition, energy, maintenance, replacement and end-of-life entries over equal service. Check the discount convention and currency year.
Compute incremental cost and incremental DALYs avoided only after signs and horizons align. End by identifying the health component and cost item that dominate, then vary the uncertain input most likely to reverse the choice.
