Yes, that's exactly what is being said. You calculate the value of both types of lives, divide by the costs, and go for whichever provides the highest resulting payoff.

In other words, you have not naively assigned the same utility to every life saved, and you have calculated things in proportion to your best guess as to their actual expected utility. You shut up and multiply. This is exactly what the sentence you objected to was trying to say.

Perhaps you already grok this principle so well that you were assuming the sentence was meant to say something else? Otherwise I'm confused why you feel the need to make that point.