Session 6.1 – Role of Economics in Priority Setting
Friday October 31 9:00-10:30
Is Cost-Benefit Analysis Amongst the Poor Ethical? A Case Study of Prioritising Public Health Programmes in Egypt
(Abstract 0014)Cam Donaldson1, Michael Schwarzinger2, Stephane Luchini3
1Newcastle University, United Kingdom, 2INSERM 707, France, 3GREQAM, France
Background: Cost-benefit analysis (CBA) continues to grow as a method for evaluating health care programmes in lower-income countries. Despite this, is main benefit measure, willingness to pay (WTP), is controversial.
Objective: To investigate rankings and WTP for three competing public health programmes addressing air pollution, water pollution and hepatitis C vaccination, and, in particular, investigate the extent to which priorities derived from rankings and from WTP values differ by income group.
Methods: 690 members of the population in Egypt were surveyed. The main part of the questionnaire involved describing the three public health programmes of interest before asking each respondent to rank them in order of priority and to express their maximum WTP for each.
Results: The rank orderings show that the water is preferred to the air programme and that they are each preferred to the hepatitis C programme. These results are consistent across all five income groups, except for the highest for whom the hepatitis programme is preferred. Overall, WTP results favour the hepatitis programme, with all groups valuing it highest, with the exception of the poorest. When applying distributional weights to the data, the water programme becomes preferred to hepatitis only when the weights are so draconian as to imply that the WTP of some higher-income groups should not count at all.
Policy Implications: CBA-wise, these results are fairly robust in favour of the hepatitis programme, although consideration needs to be given as to how account for the preferences of the most poor.
Opening the Black Box of Swedish Formulary Priority Setting - Accountability, Transparency and the Role of Health Economics.
(Abstract 0083)Sandra Erntoft
The Swedish Institute for Health Economics, Sweden
Background: Previous studies imply that little research has been devoted to understanding the actual use patterns of health economics and its role in real world priority setting processes, particularly in local health care settings.
Objective: The aim of this paper is twofold; 1) to unpack a formulary committee priority setting process based on the theoretical framework “accountability for reasonableness”; and 2) to investigate the role of health economics in priority setting.
Methods: The paper is based on a single-cased, embedded qualitative observational study. Two units; a formulary committee and an endocrinology specialist group, were observed during one year (April 2007 to March 2008). In total seven meetings were observed, audio-taped, transcribed, and supplemented by field notes. The observations was complemented by semi-structured interviews.
Results: The decision-making processes did not meet all the conditions of “accountability for reasonableness”. The lack of transparency and enforcement was compensated for by a widespread representation of health care personnel, ensuring anchoring of the decisions. Despite expressing great concern for estimating the marginal utility of new high cost drug treatments, decision-makers rarely based their decisions on the cost-effectiveness criterion, instead focusing on the price criterion.
Policy Implications: An increased use of real world data (i.e how drugs were actually used, and the associated effects and costs of specific drug treatments) may improve quality of priority setting by combining health economic evaluation techniques and data relevant to decision-makers.
Health-care rationing by default or by design? - A conceptual framework for exploring individual responsibility connected to health-care commodities
(Abstract 0081)Gustav Tinghög1, Per Carlsson2
1Department of Medicine and Health, Linköping university, Sweden, 2National centre for priority setting, Sweden
Background: Policymakers in publicly funded health-care systems are frequently forced to make decisions on which services to exclude from the publicly funded health-care. Although the concept of individual responsibility and well functioning markets are essential features of the issue, they are rarely explicitly addressed.
Objective: To present a tentative conceptual framework for exploring when health-care services contain such characteristics that facilitate individual responsibility with focus on out-of-pocket payment.
Method: First, we defined the different notions of individual responsibility. Second, we reviewed some of the literature on health-care as an economic commodity and its distinguishing characteristics from a market oriented perspective. Finally, based on the above arguments we have developed a tentative conceptual framework.
Results: We have been able to identify seven prerequisites for the suitability of private financing in health-care: (i) it should enable individuals to value the need and quality both before and after utilization; (ii) it should be targeted toward individuals with a reasonable level of individual autonomy; (iii) it should be associated with low levels of positive externalities; (iv) it should be associated with sufficient demand; (v) it should be associated with payments affordable for most individuals. (vi) and finally it should be associated with pleasure seeking rather than pain avoidance.
Policy implication: The framework presented allows us to explore individual responsibility connected to health-care as a heterogeneous group of commodities, rather than applying an all or nothing approach to inclusion or exclusion in the publicly funded health-care.
Resotrce Allocation and Priority Setting in Complex Health Systems
(Abstract 0096)Abdolvahab Baghbanian, Stephen Leeder, Ian Hughes, Freidoon Khavarpour
University of Sydney, Australia
Determining the optimal allocation of healthcare resources to improve health has been a key challenge to healthcare systems (Drummond, 2005; Mooney, 2008, Marmot, 2007). The limitless possibilities for health services force policy-makers to decide what services to provide, for whom, how, when and where (Mitton, 2004).
How does economic evaluation contribute to resource allocation decisions? Previous studies have examined the use of health economic data by one or two levels of decision-makers, but many health care systems are highly complex. This study seeks to elucidate how decision-makers decide, what economic analytical tools and/or methods to employ and why.
We recruited a purposive sample of Australian healthcare decision-makers by direct invitation through e-mail and invited them to complete a Web-based survey. We then took sub-samples from federal, state and territory, and regional levels of health service management. Quantitative questionnaire responses were subjected to multivariate analysis (SPSS). Full text transcripts of interviews are being coded thematically. In total 91 questionnaire and 25 interviews were available for analysis. As expected, there is a common understanding amongst decision-makers about resources and choices, but views about the value of economic evaluation varied. The higher the managerial level of a respondent, the greater was their understanding of the value of economic evaluation.
Key Words: Complex Systems Theory, Economic Evaluation, Decision-Making, Health System, Resource allocation.