Choosing services

Integrating Concerns for Cost-Effectiveness, Financial Protection, and the Worse Off

Ole F. NorheimProfessor in Medical Ethics and Philosophy of Science

Dept. of Global Public Health and Primary CareUniversity of Bergen

ole.norheim@igs.uib.no

Plan

• Background

• Cost-effectiveness• Financial protection• Priority to the worse off

• Classification of priority health services

Key question

• Should financial protection and distributional concerns be incorporated into decision rules for publicly financed health services?

Priority group classification

• Universal Coverage can be defined as access to key health services for all at an affordable cost

1. High-priority services2. Normal-priority services3. Low-priority services

Key

services

How to classify services?

• Cost-effectiveness thresholds< 1 GDP per capita

1-2 GDP per capita

> 3 GDP per capita

(Macroeconomics and Health 2002, WHO CHOICE)

Example

• Selected 65 health services from WHO-CHOICE database (AfrE)

• Child health services• Maternal and newborn health services• Infectious disease services• Non-communicable disease services

• Converted all costs to Int $ 2005

(WHO-CHOICE team BMJ series 2005-2012)

0 2 4 6 8 10 12 14 16

Incremental cost-effectiveness for 65 selected interventions

DALYs/1000 $

Trichiasis surgery to prevent BLINDNESS

TUBERCULOSIS: Testing and treatment

MALARIA: All prevention and treatment

Medical treatment of stroke and heart attack + primary prevention (>35)

Normal and complicated birth + Community newborn care package +pneumonia treatment

ORT, Case management of pneumonia, Measles vaccination, Vit. A and Zinc Suppl.,

HIV: Prevention and treatment of HIV including PMTC

Seatbelts, motorcycle helmets, speed cameras, breath-testing

Breast cancer treatment all stages

Colonoscopy at age 50, surgical removal of polyps, treatment

0.0 2.0 4.0 6.0 8.0 10.0 12.0 14.0 16.0

DALYs/1000 $

Two problems with CEA

• Ignores financial risk protection• Ignores distribution of healthy life years

Financial risk protection

• Publicly financed health services provide– Financial risk protection– Health

• Peter Smith : – If no one buys supplementary services, or – a well-functioning voluntary supplementary insurance marketservice selection on the basis of standard cost-effectiveness ratios

will maximize welfare (health + income) (P. Smith, Health Economics 2012)

• When there is substantial out-of-pocket payment for supplementary services, this is not so.

• High cost services may be favored over low cost services, at least among services with similar cost-effectiveness ratios.

• My interpretation:– Financial risk protection could act at least as a

tiebreaker for services with identical cost-effectiveness ratios.

Trichiasis surgery to prevent BLINDNESS

TUBERCULOSIS: Testing and treatment

MALARIA: All prevention and treatment

Medical treatment of stroke and heart attack + primary prevention (>35)

Normal and complicated birth + Community newborn care package +pneumonia treatment

ORT, Case management of pneumonia, Measles vaccination, Vit. A and Zinc Suppl.,

HIV: Prevention and treatment of HIV including PMTC

Seatbelts, motorcycle helmets, speed cameras, breath-testing

Breast cancer treatment all stages

Colonoscopy at age 50, surgical removal of polyps, treatment

0.0 2.0 4.0 6.0 8.0 10.0 12.0 14.0 16.0

DALYs/1000 $

Two problems with CEA

• Ignores financial risk protection• Ignores distribution of healthy life years

Condition B

Condition A

25

60

20

20

Who are worst off without the health service?Healthy lifeyears without service Additional healthy life years with service

Integrating distributive concerns with CEA

• An “Atkinson’s” social welfare function applied to health would judge:– (60, 45) as better than (80, 25)

(Adler, OUP 2012)

• Health prioritarianism would assign higher weights to benefits for B

(Ottersen, JME 2013)

Condition B

Condition A

25

60

20

20

Healthy lifeyears without serviceAdditional healthy life years with service

Maternal sepsis

HIVRoad injury

Tuberculosis

Cervical cancer

Colon and rectum cancers

Hypertensive heart disease

0 10 20 30 40 50 60 70 80 90 100

Individual disease burden (Source: Calculated from GBD 2010, Eastern sub-

Saharan Africa)Years of life lost

Maternal sepsis

HIVRoad injury

Tuberculosis

Cervical cancer

Colon and rectum cancers

Hypertensive heart disease

0 10 20 30 40 50 60 70 80 90 100

Individual disease burden (Source: Calculated from GBD 2010, Eastern sub-

Saharan Africa)Years of life lost

1 1.5 2

0 2 4 6 8 10 12 14 16 18

Incremental cost-effectiveness for 65 selected interventions

DALYs/1000 $

0 2 4 6 8 10 12 14 16 18

Distribution-weighted cost-effectiveness for 65 selected interventions

Priority-weighted DALYs/1000 $

DALYs/1000 $

Trichiasis surgery to prevent BLINDNESS

TUBERCULOSIS: Testing and treatment

MALARIA: All prevention and treatment

Medical treatment of stroke and heart attack + primary prevention (>35)

Normal and complicated birth + Community newborn care package +pneumonia treatment

ORT, Case management of pneumonia, Measles vaccination, Vit. A and Zinc Suppl.,

HIV: Prevention and treatment of HIV including PMTC

Seatbelts, motorcycle helmets, speed cameras, breath-testing

Breast cancer treatment all stages

Colonoscopy at age 50, surgical removal of polyps, treatment

0.0 2.0 4.0 6.0 8.0 10.0 12.0 14.0 16.0

DALYs/1000 $

MALARIA: All prevention and treatment

TUBERCULOSIS: Testing and treatment

Trichiasis surgery to prevent BLINDNESS

Normal and complicated birth + Community newborn care package +pneumonia treatment

ORT, Case management of pneumonia, Measles vaccination, Vit. A and Zinc Suppl.,

Medical treatment of stroke and heart attack + primary prevention (>35)

HIV: Prevention and treatment of HIV including PMTC

Seatbelts, motorcycle helmets, speed cameras, breath-testing

Breast cancer treatment all stages

Colonoscopy at age 50, surgical removal of polyps, treatment

0.0 2.0 4.0 6.0 8.0 10.0 12.0 14.0 16.0 18.0

Distribution-weighted DALYs/1000 $

Distribution-weighted DALYs/1000$ DALYs/1000$

Opportunity cost of implementing top 5 interventions for 5 mill $

42748 DALYs 41190 DALYs

= 1558 DALYs

Opportunity cost

• Health prioritarianism

• Knows the cost in terms of DALYs NOT averted

• Can provide reasons for re-ranking:– some priority to the worse off

Priority group classification – tentative proposal

0 10 20 30 40 50 60 70 80 90 100

Years of life lost

Ex ante / ex post prioritarianism

• Distributive weights based on final – not expected – individual disease burden for various conditions

Imagine you can help group A or B – who would you help?

Imagine you can help group A or B – who would you help?

Ex post: Even if we only know the outcome, but not who will be affected, we can evaluate alternative outcomes