QALYs, or Quality-Adjusted Life Years, are a measure used in health economics to assess the value of medical interventions. They combine the quantity and quality of life gained from a treatment. One QALY equates to one year of life in perfect health, while less than perfect health is represented as a fraction of a year. For example, if a treatment gives a patient two additional years of life but with a quality of 0.5 (where 1 is perfect health), it would result in 1 QALY. This metric helps policymakers and healthcare providers make informed decisions about resource allocation and treatment effectiveness.