8. Resource Allocation

Question 1

What is a key problem with healthcare systems?

Answer 1

Limited resources in relation to competing demands that exceed resources.

Question 2

How does the current demography of the UK affect the NHS?

Answer 2

The population is ageing and this costs more.

Question 3

How much does an 85 year old patient cost the NHS vs 5-14 year old?

Answer 3

15 times as much.

Question 4

What are the problems do new technologies bring to the NHS financially?

Answer 4

They are more expensive and expand the pool of candidates so higher cost per patient and more patients. They also don’t cure but just increase survival.

Question 5

Why are priorities in the NHS needed?

Answer 5

Resources are scarce and demand is greater than supply.

Question 6

What are the 5D’s in NHS rationing?

Answer 6

Deterrent - demands for healthcare are obstructed (e.g. prescriptions).
Delay - waiting lists.
Deflection - GP’s deflect from secondary care.
Dilution - fewer tests, cheaper drugs.
Denial - services denied to patients (e.g. reversal of sterilisation).

Question 7

What is explicit rationing?

Answer 7

Use of institutional procedures for the systematic allocation of resources within health care systems.

Question 8

How are explicit rationing rules decided?

Answer 8

Defined rules of entitlement. Decisions made by CCGs using assessments of efficiency and equity. Lay participation makes it political.

Question 9

What are the advantages of explicit rationing?

Answer 9

Transparent, accountable; opportunity for debate; use of evidence based practice; more opportunities for equity in decision-making.

Question 10

What are the disadvantages of explicit rationing?

Answer 10

Very complex; there is heterogeneity of patients and illness which isn’t accounted for; patient and professional hostility; threat to clinical freedom; patient distress.

Question 11

What is implicit rationing?

Answer 11

Allocation of resources through individual clinical decision without criteria for those decisions being explicit.

Question 12

How has the type of rationing changed historically in the NHS?

Answer 12

Before 1990 it was mostly implicit rationing with clinicians making decisions. But now mostly explicit.

Question 13

What are the dangers of implicit rationing?

Answer 13

Inequities and discrimination, open to abuse, may become based on ‘social deservingness’.

Question 14

What are the five levels of rationing?

Answer 14

How much the NHS gets compared to other government priorities.
How much to allocate across sectors, e.g. mental health.
How much to interventions within a sector, e.g. end of life drugs vs curative intent.
How to allocate intervention to different patients in same group, e.g. which patients with advanced cancer get treatment.
How much to invest in each patient once intervention has been initiated, e.g. how long to give cholesterol-lowering drugs.

Question 15

What is the purpose of the National Institute for Health and Care Excellence?

Answer 15

Enable evidence of clinical and cost effectiveness to be integrated to inform a national judgement on the value of a treatment relative to alternative uses of resources.

Question 16

How does NICE appraise new drugs/devices?

Answer 16

On clinical benefit and costs.

Question 17

How does NICE impact local recommendations?

Answer 17

It replaces them to promote equal access for patients across the country.

Question 18

What is the basis of tariffs?

Answer 18

Payment by results/

Question 19

What is the role of healthcare resource groups?

Answer 19

Reflect an imperfectly measured average cost for an individual patient spell.

Question 20

How do tariffs affect efficient and inefficient trusts?

Answer 20

Efficient trusts make a profit, inefficient trusts lose money. So there is an incentive to be more efficient over time.

Question 21

What is a never-event?

Answer 21

An avoidable complication that costs a trust money as they don’t get the tariff payment for it.

Question 22

What is the concept of scarcity?

Answer 22

Needs outstrip resources so prioritisation is inevitable.

Question 23

What is efficiency?

Answer 23

Getting the most out of limited resources.

Question 24

What is equity?

Answer 24

The extent to which distribution of resources is fair.

Question 25

What is effectiveness?

Answer 25

The extent to which an intervention produces desired outcomes.

Question 26

What is utility?

Answer 26

The value an individual places on a health state.

Question 27

What is an opportunity cost?

Answer 27

Once you have used a resource in one way, you no longer have it to use in another way - you can’t have your cake and eat it.

Question 28

What is cost minimisation analysis?

Answer 28

Outcomes are assumed to be equivalent so choose the cheapest one.

Question 29

Why is cost minimisation often not used?

Answer 29

Outcomes rarely are equivalent so it’s not often relevant.

Question 30

What is the use of cost effectiveness analysis?

Answer 30

Used to compare drugs or interventions which have a common health outcome.

Question 31

What is cost benefit analysis?

Answer 31

Compares things with inputs and outputs valued in monetary terms.

Question 32

What is cost utility analysis?

Answer 32

Quality of health outcomes produced or foregone, uses QALYs.

Question 33

What is a QALY?

Answer 33

Quality adjusted life year. One perfect year of health = 1 QALY = ten years of 10% quality of health. They consider quality and quantity of life.

Question 34

How are QALYs measured?

Answer 34

Using a generic HR-QoL instrument, like an EQ-5D.

Question 35

When were QALYs first used?

Answer 35

Since the 1970s.

Question 36

How do NICE assess cost-effectiveness?

Answer 36

Integrating the QALY score with the price of treatment using the incremental cost-effectiveness ratio (ICER).

Question 37

What are the guidelines for approving based on cost per QALY?

Answer 37

> £25,000/QALY generally accepted
£25,000-£35,000/QALY consider degree of uncertainty, if HRQoL is adequately captured in QALY.
£30,000/QALY need an increasingly stronger case to be approved.

Question 38

What are some of the limitations of QALYs?

Answer 38

Don’t distribute according to need but to cost, problems with calculations, may not consider all dimensions of benefits, controversy about the values they embody, RCT evidence is limited.