Prioritisation in Public Health: Overview of Health Economics Approaches

Prioritization in Public Health:

Overview of Health Economics

Approaches

Olena Nizalova

Centre for Health Services Studies

University of Kent

Follow on Twitter: @olniz @chss

Kyiv, 30 June 2016

School for Public Health Research (SPHR)

The Team

• David Hunter (PI), Linda Marks, Jean Brown, Durham

University

• Luke Vale, Sara McCafferty, Newcastle University

• Jo Gray, Northumbria University

• Sarah Salway, Nick Payne, Praveen Thokala, Sheffield

University

• Stephen Peckham, Olena Nizalova, University of Kent


Introduction

• Scarcity

• Management of scarcity

• Approaches

• Adoption


Economic concepts

• Opportunity cost

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0.5

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1.5

2

2.5

3

3.5

4

4.5

5

Choice 1 Choice 2 Choice 3 Choice 4


Economic concepts

• Margin

0

1

2

3

4

5

6

7

8

Choice 1 Choice 2 Choice 3 Choice 4

Column1


“Ideal” priority setting

• Ability to consider questions of efficiency and equity

• Process should be open and explicit

• Evidence from research should play (some) part in the process

• National priorities should be incorporated

• Should be based on an ethical framework

Demanding, challenging and complex.


Priority Setting:

Ad hoc or Rational?

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


PRIORITY SETTING

PROCESS


Information, Data and

Analytical Methods

Stakeholder & expert views and National/Local

Directives• Identify key local stakeholders – e.g.

o Health & Wellbeing Board

o Cabinet and “Ruling Party”

o Local people and communities

• Identify key national stakeholders – e.g.

o Policy

o Legislation

o (UK) National Institute for Health and Care Excellence (NICE) –

especially Public Health guidance

Data• Epidemiology – who, where and when

• Current provision and Costs

• Effectiveness information - from trials and evaluations

• Inequalities - in both poor health and service provision


• Historical allocation

• Changes in funding over

time

• Patterns of funding

between locations

• Predicted changes in

key determinants of

expenditure

• Identify inequalities in

expenditure

• Can be similar/same as

programme budgeting


Analytical Methods

Current patterns of expenditure


PRIORITY SETTING

PROCESS


Pre-investment Costs – Post-investment costs

=

Return on Investment in monetary units (of benefit).

Note that the Scope for cost and savings depends on

perspective:

• NHS/Local Authority

• Public Sector

• Wider Societal


Analytical Methods

Return on Investment


Economic Analytical

Techniques

Full economic evaluation consists of finding both the costs and the benefits of comparable public health services. This may be more familiar to Local Authorities as a “Value for Money” assessment.

What is economic evaluation?

Total costs valued in monetary terms (£)

Intangible Costs

Indirect Costs

Direct Costs

• Natural units, e.g. deaths, numbers of accidents, numbers of people quitting smoking, etc.

→ Cost-effective analysis

• Utility values, e.g. Quality Adjusted Life Years - QALYs

→ Cost-utility analysis

• Monetary value (£)→ Cost-benefit

analysis


PRIORITY SETTING

PROCESS


Steps involved in

Prioritisation

1) Agree public health objectives

2) Identify options for reaching objectives

3) Identify resources

4) Identify measureable criteria for comparing options and

assess costs and benefits of options.

5) Decide on preferences

6) Make choices

7) Evaluate impact


Priority setting using multi criteria

decision analysis (MCDA)

• MCDA supports decision makers faced with

evaluating alternatives taking multiple, and often

conflicting, criteria into account.

• Not new, already used:

- Portsmouth Scorecard

- Option Appraisal

- STAR – Socio-Technical Approach

- Health England Leading Prioritisation

- Programme Budgeting and Marginal Analysis

(PBMA)


Priority Setting Approaches

Factor Very low Mid-scale Very high Score Out of

Magnitude of

benefit

(Health gain)

Under 3 points

Limited

improvement

20 points

Moderate

improvement

40 points

Large

improvement

40

Addresses

health inequality

Under 3 points

Not addressed

20 points

Partially

addressed

40 points

Fully

addressed

40

Strength of

evidence of

effectiveness

Under 5 points

Limited or no

evidence

(Case series)

10 points

Modest evidence

(Cohort studies)

20 points

Good

evidence

(RCTs)

20

Cost utility

Under 3 points

> £20,000 per QALY

20 points

£10-20,000 per

QALY

40 points

<£10,000 per

QALY

40

Total 140

Prioritisation Matrices - Portsmouth Scorecard

*Austin, D., Edmundson-Jones, P. and Sidhu, K. (2007) Priority setting and the Portsmouth scorecard: prioritising public health services: threats and opportunities.



Option Appraisal – Local Authority PH Programme Investments

Criteria

Raw Scores (total out of 60) Weighted Scores

Weights

(100)

Alcohol Sexual

Health

Physical

activity

Alcohol Sexual

Health

Physical

activity

Health Benefit25 7.2 6.8 3.5 180 170 150

Political

Mandate 15 6.3 7.2 9 94.5 108 135

Health

inequality20 7.5 6.9 8 150 138 160

Strength of

evidence10 6.8 7.3 2 68 73 35

Cost

effectiveness20 7.2 5.6 4 144 112 80

Practicability

&Timeliness10 5.6 7.5 10 56 75 100

Total 100 40.6 41.3 40.5 692.5 676 660

Rank 2 1 3 1 2 3


Use of Economic Analytical

Techniques: Visual Representation –

used in STAR Approach

• Costs and benefits

estimated separately

• Lower cost to benefit to

ratio preferred

• Can take into account

scarcity of resourcesA

B

C

D

Benefits

Budget Constraint



DCE for prioritisation – HE.LP Project

• Long term, resource intensive Health England project for prioritisation

• Weights are estimated using indirect methods (large survey of general population)

• Value scores are derived from systematic reviewing, evidence synthesis and

modelling

• Complex data analysis and modelling used to arrive at final priority scores

Ranking of prevantative health interventions

Problem

targeted

Priority

ranking

Priority

score Reach

Inequality

score

Cost

effectiveness Affordability

Certainty (EB:

evidence base)

Intervention

(% decision

makers

rank as top

priority)

(%

population

affected)

(% dis-

advantaged

affected / %

all affected)

(cost per

QALY gained)

(***<£100;

**£100-

£1bn;

*<£1bn)

(***high quality EB;

**good quality EB;

*low quality EB)

Increase tax by 5% Alcohol 1 11.2 18.40% 1.78 -£5,267 *** **

Screening and treatment to

reduce Chlamydia STI 9 7.3 11.30% 1 £370 *** **

Screening to prevent

depression in retirees

Mental

health 14 0.1 1.50% 1.08 £70,120 *** ***

* http://help.matrixknowledge.com



PBMA (Programme budgeting and marginal analysis)

* http://www.cihr-irsc.gc.ca/e/43533.html


Priority Setting Methods

and Evidence

22

Scorecard

~ few hours

DCEs

~ few months

Subjective

Judgement

~ few hours

Evidence

Portsmouth

Scorecard

PBMA

HE.LP

Socio-technical

approaches ~ few

weeks

STAR

Option Appraisal

Evidence

Synthesis/

Modelling

~ months

Prioritisation

methods

Some local authority

prioritisation decisions are on a

long planning cycle – others

need to be made quickly.


Advantages and Disadvantages

of Different Prioritisation Methods

Method Advantages Disadvantages

Portsmouth scorecard Quick, intuitive and easy

to use

Only uses subjective

evidence

Option

Appraisal

Already used in Local

Authorities

Can tailor complexity

Can be manipulated

Typical MCDA Combines objective and

subjective data

Time and resource

intensive

MCDA with DCEs (e.g.

HE.LP)

Robust, evidence based

approach

Time and resource

intensive

PBMA Considers both

investment and

disinvestment

Users tend to focus on

PB aspect only


Summary

• A range of approaches exist to manage priority

setting decisions

– These are not mutually exclusive

• Different approaches can differ in complexity, time

and cost to complete

– Ranging from ‘rough and ready’ to very

sophisticated

– Consideration of Informational, Data and

Related Requirements needs to be proportional.

Health & Medicine

Prioritisation in Public Health: Overview of Health Economics Approaches