Health values are important components of medical decisions. Experimental data suggest that people value health in complex and dynamic ways. Prospect theory is a descriptive theory of choice that may accurately characterize how people assign values to health states. The authors first provide background on prospect theory and how it can be applied to health values. Next, they review the relevant health research and find mixed support for prospect theory. Last, they discuss implications of prospect theory for cost-effectiveness analysis. The application of prospect theory to health deserves further research because it may help clarify the link between health and values.