Meeting Need Economics for Commissioning and Priority Setting : theory and practice. Jo Gray

Transcription

1 Meeting Need Economics for Commissioning and Priority Setting : theory and practice Jo Gray

2 Session Outline Introduction to the concept of scarcity and commissioning/priority setting in the NHS Introduction to the role of economics and economic principles in addressing and managing scarcity The application of economic principles to commissioning/priority setting

3 = Scarcity

4 Does the NHS manage scarcity? National Level: Priority setting via NICE & HTAs Local Level: managing scarcity through Priority setting and commissioning CCGs are responsible for managing the local health care budget, and assessing population needs, purchasing and/or organising services to meet needs, and implementing national guidance = COMMISSIONING

5 But how and how can health economics help us? What frameworks and methods are available?

6 Summary of prinicples Weighing up costs and benefits- the inputs and outputs from alternative use of resources

7 The application of economics to priority setting : National Level How can we re-allocate resources to maximise benefits to the population for the resources available? Economic evaluation underpins principles at national level

8 Economic evaluation What is economic evaluation? The comparative analysis of alternative courses of action in terms of both their costs and consequences Why conduct an economic valuation of health care options? Scarcity implies the need to make choices and to be efficient with available resources

9 2. Are at least 2 alternatives compared? determine forms of evaluation 1. Are both costs (inputs) and consequences (outputs) examined? NO YES Examines only consequences NO Examines only costs 1A PARTIAL EVALUATION 1B Outcome description. Cost description. 3A PARTIAL EVALUATION 3B Efficacy or effectiveness evaluation. Cost analysis. YES 2 PARTIAL EVALUATION Cost-outcome description. 4 FULL ECONOMIC EVALUATION Cost-minimisation analysis. Cost-effectiveness analysis. Cost-utility analysis. Cost-benefit analysis.

10 Summary of evaluative techniques Evaluative technique Benefits Unit of measurement Cost-effectiveness analysis Cost-utility analysis Cost-benefit analysis Quantity of life OR Health gain Quantity & quality of life Quantity & quality of life (possibly including some nonhealth aspects) Life years gained Natural units e.g. - Pain reduction - Cases detected - Activities of daily living - Cholesterol reduction - QALYs (generic or condition-specific) - HYEs Money e.g. - Human capital - Willingness to pay

11 The application of economics to commissioning: Local level How can we re-allocate resources to maximise benefits to the population for the resources available? Allocative and technical efficiency issues Economics can provide some principles but can we operationalise them in a way that CCGs and similar organisations can use?

12 Priority Setting * Priority setting of health interventions: the need for multi-criteria decision analysis, Rob Baltussen, Louis Niessen, Cost effectiveness and resource allocation (2006)

13 PRIORITY SETTING PROCESS

14 MCDA steps 1) Establish the decision context, objectives (goals), and identify the decision maker(s). 2) Identify the intervention alternatives. 3) Identify the relevant criteria to the decision problem 4) Estimate the performance of the interventions on the criteria by gathering evidence or expert opinion 5) Estimate the overall score of all the interventions i.e. these scores can then be used to prioritise

15

16 Advantages and Disadvantages of Different Prioritisation Methods Method Advantages Disadvantages Portsmouth scorecard Option Appraisal Typical MCDA (e.g. STAR) MCDA with DCE s (e.g. HE.LP) PBMA Quick, intuitive and easy to use Already used in the NHS Can tailor complexity Combines objective and subjective data Robust, evidence based approach Considers both investment and disinvestment Only uses subjective evidence Can be manipulated Time and resource intensive Time and resource intensive Users tend to focus on PB aspect only

17 Outcome Z score Overview of Spend & Outcome Lower spend, Better outcome Higher spend, Better outcome Nn Oth HI Mat,SC Blood LD,Vis,Hear,Dent Can GU Poi Neu,Circ Skin Musc GI End Resp Inf MH,Trau Lower spend, Worse outcome Spend per head Z score Higher spend, Worse outcome

18 Standardised Comparator North Tyneside Nottingham North & East North Tyneside Nottingham North & East Spend (z) Weighted outcome (z) Inf Can Blood End MH LD Neu Vis Hear Circ Resp Dent GI Skin Musc Trau GU Mat Nn Poi HI SC Oth Inf Can Blood End MH LD Neu Vis Hear Circ Resp Dent GI Skin Musc Trau GU Mat Nn Poi HI SC Oth

19

20 Multi Criteria Decision Analysis Assessing options against multiple criteria Can be conflicting objectives Weighting and scoring criteria Uses different data sources Combines hard data & value judgements Different methods differing levels of complexity

21 Portsmouth Scorecard Factor Very low Mid-scale Very high Score Out of Magnitude of benefit (Health gain) Under 3 points Limited improvement in health or life expectancy 20 points Moderate improvement in health or life expectancy 40 points Large improvement in health or life expectancy 40 Addresses health inequality Strength of evidence of clinical effectiveness Cost effectiveness Under 3 points Does not address a health inequality Under 3 points Limited or no evidence (Case series, experimental) Under 3 points > 20,000 per QALY 20 points Partially addresses a health inequality 20 points Modest evidence (Cohort studies) 20 points 10-20,000 per QALY 40 points Fully addresses a 40 health inequality 40 points Good evidence 40 (meta-analysis, RCTs) 40 points < 10,000 per QALY 40 National and local priority Number who will benefit (not the number treated) Affordability Under 3 points None Under 3 points 10 Under 3 points > 100, points Two targets Identified as need in the CSP/JSNA 20 points points < 50, points must do 40 Major need in CSP/JSNA 40 points 10, points Cost saving to the PCT 20 *Austin, D., Edmundson-Jones, P. and Sidhu, K. (2007) Priority setting and the Portsmouth scorecard: prioritising public health services: threats and opportunities.

22 Summary There will never be enough resources to meet all unmet need/demands/wants Resources are scarce Choices have to made and managed Economics is discipline founded on explicit recognition of scarcity and should provide some theory and solutions MCDA provides a vehicle for opertationalising economic principles fast and frugal