Tag Archives: Government

Is health technology assessment morally defensible?

Capturing race

Is HTA like GO? (Photo credit: Wikipedia)

Increasingly widespread amongst the world’s healthcare systems is the assessment of medicines and devices using various types of cost-benefit or cost-utility analysis; this is called health technology assessment or HTA. HTA seeks to determine, using evidence of one sort or another, whether something is broadly speaking affordable, taking account of the cost of the medicine/device taken against the benefit to a particular constellation of diagnostic attributes in patients. This is usually quantified in a measure called a QALY: a quality-adjusted life year, which is a way to assess the value for money of a particular health technology. In short, it is a way of valuing lives.

HTA is a utilitarian approach to assessment. To some extent, this is not surprising as HTA is in the main a method developed by health economists, who, like economists in general, hypothesise that we make daily decisions based on the utilty of this or that, in terms of trade-offs (Pareto optimisation, for instance) and rational decision making (that people seek to maximise value, or utility in what they do). This approach is increasingly in dispute in light of the findings from neurosciences and behaviour economics: by posting that people do not always make decisions that are in their own best interests, a key assumption of traditional economics, that of the rational actor, always calculating trade-offs and maximising benefits, and so on, is questioned.

The problem with utilitarianism, though, is it doesn’t pay attention to the freedom of the individual; it positions the justification of its results on the net benefit to society, regardless of the impact on rights of individuals. Obviously, health economists don’t watch Star Trek or they would know that the needs of the one outweigh the needs of the many. But then, that, too, is a moral position.

Indeed, it is perhaps the sense that utilitarian conclusions don’t seem to correlate with many people’s moral sentiments that may explain why decisions of HTA agencies, for instance NICE in the UK (England) lead to moral outrage and a sense of, if not injustice, at least unfairness. While the results of an HTA process may lead to a quantitatively defensible conclusion, people sense that this conclusion is not morally defensible.

How are we to judge? Few would use utilitarian arguments in this way in other spheres: would we calculate who needs welfare in terms of the net benefit to society in terms of quality of life years, though perhaps we do allocate welfare on moral assumptions that some people deserve welfare while others don’t.

Do we allocate support to communities ravaged by floods based on their overall contribution, or utility, to society.  If you could donate £10 million to a university, would you pick Oxford University or Thames Valley University; which one is more worthy? But would you want to treat people this way?

HTA doesn’t even let us value lives in quite this way, since it neatly avoids deciding about the worth of any particular type of person, who just happens through misfortune to find themselves needing some medicine that fails the HTA tests. HTA keeps us from confronting the fact that HTA is a way of drawing a conclusion, without actually having to decide any allocations for any one person in particular. Bentham would approve.

There is, though, a technical problem with HTA and it has to do with whether at one level of assessment outcome, a utilitarian models can be used when the decision to be made does not have life threatening consequences for some people.

If the QALY threshold is, say £35,000, as it apparently is in the case of NICE, are the decisions below that threshold, which tend toward ‘yes’ or ‘approval’ morally different from decisions above that threshold?  I suggest that different moral criteria come into play above the threshold and this is where I think out moral outrage should be directed and where HTA fails.  Regretfully, HTA models see the results as broadly continuous, that is, decisions above and below this threshold are seen as essentially of the same type.  But I have argued elsewhere that above the threshold, HTA models fail but for reasons other their analytical soundness, because above this threshold, the conclusions may lead to a lessened quality of life, in other words, they actually crystallise the health outcome rather than avoid it.

Therefore, in valuing lives, those above the threshold experience greater injustice than those below; they are treated differently, unfairly, unjustly, perhaps less worthy, but certainly differently.  Indeed, above the threshold, we feel we are more in the realm of our moral sentiments about the value of human life, and less our moral sentiments about the allocation of scarce resources.

If this were not so, then we would be living in a society that believes that the determinant of all important moral and political decisions is affordability, and if that were so, they we could not even afford the costs of inefficiency brought on by democracy, the inconvenience of not being able to exploit people, the costs of equal rights.

Perhaps, though, on our financially contaminated world, all we can think about today is money and that is further contaminating our perception of what sort of society we are actually trying to foster.  Certainly, protests on Wall Street and elsewhere point to the view that there seems to be some unjust allocation of the benefits of government bail-outs that just doesn’t benefit those ‘at the bottom’.

John Rawls wrote that the we should distribute opportunity in a society in such a way as to ensure that the least well off benefit the most. In the context of HTA, medicines and technologies that benefit only a few, but at great cost, represent a cost worth having as the least well off, namely those who would need it most ( have the condition it treats, and in some societies can afford it least), would benefit, even if a little, as that is the price we pay for justice.

This, I suggest, is the root of our moral outrage at HTA, that is unjustly fails to serve those who need it most.

I am left with wondering about the underlying morality of HTA as a government scheme. Governments, as we know, are the last resort, when things are tough and one would hope, ensure that the least well-off in society are not penalised simply in virtue of being least well-off.  In healthcare, someone has to be the carer of last resort; using HTA as a way of avoiding this responsibility is not morally defensible.

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The Grand Challenges

The Grand Challenge Equations

If only the Grand Challenges were that simple!

The State of the Union message by President Obama focused around key challenges facing the United States to embrace the changing world. His list included:

  • education
  • innovation
  • infrastructure
  • government reform

This is not a bad list for starters. In my own work with clients, these are key recurring issues, which today take on new urgency, and are as relevant to the US as the EU and emerging countries. The one issue that does wake ministers of finance up in the middle of the night is the rising cost of healthcare, and that is its own challenge.

Let’s briefly reflect on each of these four, though, for now:


A 10-year old girl in a public school will enter the world of higher education or employment in perhaps the year 2020: how is her experience of education preparing her for that world? Are her teachers the very best for developing her for the future, encouraging curiosity and helping her be adaptable and courageous? Is the higher education system ready for the challenges of the future? I somewhat despair about our universities, and do think they need to revisit their social mandate, as they are at present our key and only institutions for the inter-generational transmission of knowledge, yet academics seem pre-occupied with other matters (such as the length of the CV and research), while teaching seems to suffer. We need to re-energise the learning part of higher education, and not just through a technological fix of e-learning, but through the invention of new institutions of learning. Increasingly scarce public funding should not be wasted on unreformed higher education, but should reward innovative and potentially disruptive learning opportunities.


Yes, more and better and faster. The historical forces that got us to the present have been silenced as we have become trapped in regulation and rules that discourage risk-taking, and reward the compliant at the expense of the disruptor. Companies and government, both, have trouble with trouble makers who don’t adopt the institutional rhetoric. Access to early-stage funding for innovations is weak and research suggests likely to be harder to get but governments may find themselves unable to provide all the necessary funding under current circumstances. Innovative ways to innovate and commercialise are necessary and which bridge the ‘valley of death’ with effective strategies that de-risk the innovation development process. Regretfully, to some extent, our universities frequently have a small view of their role here (technology transfer), but leaving this to others to take the risks is no longer an option. Entrepreneurialism is needed within the research communities, linked to real-world challenges (I am not ignoring the need for pure research to create new knowledge). And perhaps some better priority setting: while it may be nice to have the latest smartphone, we do need to solve the problem of malaria, unclean water, poor quality nutrition. These challenges do not go away just because we can text our friends more easily — yet within the smartphone technology may lie ways to solve these threats to humanity if we are creative enough to think those thoughts.


This is the never-ending struggle for government and industry. Capital investments in public infrastructure offers opportunities for innovation to build faster, cheaper, better. Innovations in building technology can give us better roads, improved rail-links, better public housing. While we are focused on the digital technological infrastructure (of wireless and web), we cannot ignore the need to drive forward new infrastructure thinking around energy and transportation to name two big ones. Many (Western) governments may be trapped with legacy infrastructures, making it hard to leapfrog to new approaches. But perhaps we are at the point where we need to literally junk industrial-era infrastructure logic and make that leap of faith — in ourselves and our future. Timidity is no longer an option.

Government reform

“Smart government”. Is that an oxymoron? How has the digital revolution altered the size and structure of governments? Having looked at this issue, I find that governments are frequently wedded to ponderous and very hierarchical internal processes, characterised to a great extent by caution (legislate in haste, repent at leisure?).  We also find protective practices, which can make it hard to reform government working practices even when there is the will to act. Governments are expensive; indeed, governments are monopoly suppliers of government, and if they do their job badly, we all suffer. The next ‘bubble’ will likely be from the public sector, and in particular from central governments, where the need for reform is greatest. Open and transparent government has all of us as stakeholders and the more we take an interest as taxpayers in the functioning of government the greater the likelihood we will get the reforms for the government we need.

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Pension Envy and the next ‘bubble’

Compare the population pyramid of the USA whic...

The population pyramid reveals the pension challenge; each country has one.

Probably for the first time, thanks to baby boomers, we are entering a period with very large numbers of people entering various stages of retirement.

And with the expansion of the state over the past 30 years or so, large numbers of civil servants will also be retiring on pensions financed by the taxpayer.

And, to make it worse, rather than fully funding pensions, governments have failed to finance these pensions with contributions, preferring instead to treat pension deductions as a source of income in the short term, thinking that pensions would be affordable from future tax revenues.

Oh dear, and to make it even worse, civil servants enjoy considerably preferential working conditions, again courtesy of the taxpayer, so they are retiring earlier with more stable and assured pensions.

All this compared to those who chose other careers.

The meaning?

Well, fast forward a few years, and I suspect we will see civil servants with their somewhat more assured retirement income, enjoying life a bit more easily while large numbers of other people will be still at work, probably still at it when the grim reaper calls.

Will this disparity lead to pension envy — the lusting after preferential pension entitlements by those who did not take tax-subsidised jobs in the public sector? I wonder. Could it cause social unrest. I think it just might, as the income governments need to fund these pensions for essentially idle retirees, will come, wait for it, from those still working. So even as people try to make ends meet in retirement, they’ll still be paying taxes to finance the lifestyles of retired civil servants.

Of course, this is not to deny the importance or meaningfulness of much public sector work. My point is to highlight the behaviour of governments as employers, who essentially have been irresponsible by not establishing funded pension schemes, in order to lift the pension burden from future generations of taxpayers. What is galling, I suspect, for many folk, is the duplicity of government is revealed, as they have legislated on the one hand for good private sector pension regimes, while neglecting to deal with their own house.

If the government were a company, would anyone bail them out?

Perhaps the next economic ‘bubble’ is governments as they come to grips with their own poor future financial planning despite knowing all this was coming. Now that their backs are against the wall, they are prepared to read the writing on it, but with powerful vested interest groups, will the taxpayer be fleeced yet again?

The problem with governments, though, is that they are monopoly suppliers of this chaos, and the individual taxpayer cannot escape this irresponsible behaviour.

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An Auditor of One

A surgical team from Wilford Hall Medical Cent...

An Auditor of One checking on surgical performance

The UK’s coalition government’s reform agenda continues to unfold with the planned scrapping of the Audit Commission. While the Commission has good analytical capacity and did focus on issues of importance, the need to shift the audit function further into systems and out into the community was not one of its core objectives.

In healthcare, I have written and spoken of the patient as the “auditor of one”, as the patient is the only person who has a real experience of the continuum of care, and it is only through the patient that the integration or not of services is achieved. While bureaucratic processes may try to knit systems together at their edges, only users have that ‘joined up experience’, and it is by engaging with them more effectively that radical service improvement will come about (the use is really the most disruptive force for quality improvement we have).

The next test for audit in the UK will be ensuring that all these auditors of one can be effective; rather unfortunately, the government is referring to them as “armchair auditors” a term which tends to describe distant interest, rather than engaged in the critical appraisal of performance. But organised interest groups can emerge, or existing one expand their scope of interest to increase the salience of issues in the delivery of publicly funded services.

I think one auditor is really enough anyway, but the National Audit Office will need to expand its remit in at least two areas if it is to be really worthy of public expectations, to include:

  1. value-for-money retrospective audits (and not just of assessing implementation against legislative intent);
  2. prospective audits of planned legislation (similar to the US non-partisan Congressional Budget Office).

I might add a third, namely being advised by, and engaging with, the public, perhaps through regional citizen audit advisory groups who can act to bring local concerns together where national concerns, at least, are an issue. There are models for this sort of relationship which would enhance accountability, transparency and visibility with the public.

Systems Goverance is Confused in the NHS White Paper

The English NHS is in for further reform as the flurry of consultation documents and the White Paper evidence. Overall, NHS reforms have been generally weak in having a thought-through systems governance approach. I think in part this arises from perceived problems with two areas: the role of the private sector: the systems governance of previous reforms has tried to ignore this sector, and in effect partition the health market certainly in England, with the result that a single playing field for providers couldn’t emerge. This was compounded by the previous government’s views that NHS providers could fail twice before being of public concern (a silly and ideologically driven position). The second problem has always been the purchasing side (a.k.a. commissioning), where there has been over the years feare of ‘letting the market rip’ (as if we somehow markets are generally regulated anyway), anxiety about purchaser impact on provider viability (again an ideological position on the how to deal with failing public institutions — the usual response it to prop them up with more money). or more generally a plethora of initiatives (such as World Class Commissioning — I wonder when this one gets buried?), whieh exuded more style than substance.

And so it continues with a failure, I think, once again to get the commissioning side of the health system balance sheet cleaned up.  One of the key things that needs to be central to systems governance is clarity of mission of the various bits that make it go, and how conflict is managed, mainly for systems-level problems that need to be resolved within the system, rather than constantly being taken back into the political machinery for resolution. Given that the coalition government wants to create some distance between the Department of Health and the regulatory oversight structures themselves (Monitor, CQC, NHS Commissioning Board seem the main statutory bodies here plus the GP Consortia and providers as agents), the possibility of conflict emerging between the Board and the other two regulators is real.

The NHS Commissioning Board will have oversight of GP Consortia, and in effect givea them a licence of fitness to practice; though this isn’t the exact terminology used, the Board does decide if GP Consortia are handling financial risk well, within the overall clinical frameworks and other guidance. And what of failing GP Consortia?

I am troubled in particular that the Board will be commissioning services for primary care and for national and specialist services. This is where the core problem for system governance lies, as the Board has a potential serious governance conflict between its oversight and regulatory role and its activities as a purchaser (sorry, commissioner…).

Who oversees the NHS Commissioning Board’s commissioning and why should anyone trust them to do a good job in absence of suitable oversight — are they not both poacher and gamekeeper? Since the Board will be commissioning, and also overseeing commissioning by GP Consortia who must commission within the any willing provider framework, will the Board be similarly constrained? While GP Consortia’s behaviour is subject to oversight by the Board in respect of commissioning decisions, the Board appears not to have any oversight in this respect (apart from the usual warm words that folks will consult and work in partnership, etc.) My worry is that the collective effect of GP Consortia commissioning may have some relationship with the desirability or not of specific national or specialist service commissioning. I am also worried about the logic underpinning what national and specialist in fact are, as this type of thinking is really ‘old school’, and is a remnant of centrist thinking. The epidemiology and service logic at work here could also find itself at odds with the possibility of unbundling and decentralising or otherwise restructuring such services (where capabilities, technologies, and opportunities present themselves), a possibility that innovation might unleash, but which cannot be anticipated by this particular solution. As well, we are too aware of the failure of prestigious providers to fail in their quality (do we need to mention neonatal heart surgery?)  So the assumptions underpinning the centrist logic of national and specialist commissioning should fall both within the remit of CQC and Monitor and under the wing of GP Consortia.

The proposed NHS System Governance System, 2014

Apart from all the other things that the Board will do (a very long list) adding into this mix managing commissioning relationships with providers seems not just a task too far but a source of considerable and likely conflict. This is to say absolutely nothing about how they will handle the commissioning of GP and other primary care services, which entails commissioning services from people that, in an different guise as GP Consortia, they in effect regulate.

How to do that? Well… Critical to effective commissioning is ensuring that adequate analytical capacity exists at the levels at which decisions are being made. If, and I see no reason to doubt this, GP Consortia do their jobs well with excellent analytical capacity to inform their decisions, they can, in some collective form, create an appropriate structure to handle the commissioning of national and specialist services. This will ensure the better integration of commissioning decisions, smooth the flow of patients and resources across the borders of GP Consortia, and clarify referral protocols. It will ensure that these national services are really national or specialist and are governed by common standards of regulatory oversight. Importantly, it avoids the potential for gaming the system, as it removes an incentive for providers to lobby for the creation of national or specialist services as a way of protecting their service infrastructure, and ensures that any complacency in service quality improvement is avoided by being able to for specialist providers to forum-shop for a regulator.


The Cognologist’s European Blog is rated influential in Europe

Visualization of the Influence Landscape

Visualising Influence

The Policy Cognologist also maintains a European policy blog, Euro-Sante/Euro-Health. Waggener-Edstrom Worldwide conducted a study of the most influential policy oriented blogs in Europe and I am delighted that my blog was rated amongst the most influential specialist blogs.

There is also activity on Twitter about the influence of the blogs in the study in the EU at #bbs10. You can also request a copy of the report with ratings of all the blogs, specialist and general at Waggener-Edstrom.

The report makes for interesting reading. One observation is the relative greater influence of generalist policy blogs over specialist ones; the highest rated is written by someone from the BBC. Others by folk with less illustrious affiliations, but no less important things to say.

I am pleased though to be counted amongst such company.

Overall, the blogs represent efforts by many people across Europe to put ideas forward with varying degrees of success or recognition. The world wide web creates amazing opportunities for fresh ideas to be presented in easy and accessible forms. Blogs can be updated quickly and with RSS feeds, interested individuals can receive notifications of new posts. Whether internet search engines effectively identify blog entries is another matter. Blogs operate in the real world in real time and with rankings such as Waggener-Edstrom’s, the task is much easier for bloggers with important things to say to be heard.

On a cautionary note, policy processes within the EU and government depend on having accessing to fresh ideas and knowledgable people. But in my experience, they can fail to engage with emerging influencers, as well as with individuals who lack official, recognised or organisational positions to give them ‘organisational cover’ as it were. Influence and quality of thinking depends more on the cogency of the writer’s knowledge and ability to craft succinct argument, than the reputation of their employer (and perhaps the EU puts too much emphasis on the latter).

The Grand Challenges of Modern (indebted) Governments

Daily we read of the debts that governments have run up, whether Greece, Hungary, UK or elsewhere. How has this come to pass will require all of us to reflect on what we expect from government and indeed what is government for. Folks such as Robert Nozick argued for the minimal state, all the way over to the bankrupted ideology of the collectivist state. In between lies reality.

Therefore, in the spirit of redefining the purpose and function of the modern state, I am asking this question:

what are the Grand Challenges for modern government?

In effect, what is the purpose of government? What is on the list will reflect the current priorities, but also an effort to anticipate the consequences of current actions by public bodies — if governments stop doing some things, what will happen down the road.

Here is some to get us going. I think we need 10 at the most as they must in the be both grand and challenges; my list may in the end be neither, but let’s see.

Boundary value problem for an arbitrary shape

Like any good challenge, one needs to know what is in the problem, what is outside the problem and line that demarcates the two

  1. A challenge is to ensure that governments are subjected to the same rules and regulations as everyone else.  Someone said, it would be a shame to waste a good crisis, so many governments find themselves in a crisis, and in many cases they are part of the problem, not part of the solution. Governments have some role to pay in aligning efforts to solve the crisis, but they are not exempt from the solutions.
  2. A challenge is to design a simple tax system. We don’t need governments to create complex, full of exceptions tax systems. We have complex tax systems that have becomes ends in themselves, inscrutable and reflecting overly bureaucratic approaches. Rebooting our logic of taxation is a non-trivial challenge. The problem though is that governments use financial instruments as carrots and sticks to alter behaviour, whether of individuals or corporations. We need to rethink our use of financial instruments as tools of policy and that these financial instruments must deliver social outcomes, not just be used to fund government programmes.
  3. A challenge is to better control adventuresome, rent-seeking behaviour of civil servants.  Too often, hyperactive civil servants follow a logic of state intervention because in the end it may be easier to do and please political masters, than to do the harder, consultative and more developmental approach which will produce the best outcomes, but with the least amount of government. The problem is that civil servants are rent-seeking, and are rewarded for expansionist activities. We see this with regulators who either do their jobs badly (regulators are after all monopoly suppliers of regulation, so if they do a bad job, we the regulated have little choice), or seek to expand the scope of their mandates, like a gas (there is always some reason to expand a mandate, when there is no one to say no). To be fair, the private sector also has adventuresome corporate executives who need to prove themselves through adventuresome corporate mergers and acquisitions — fortunately they don’t always get their way, such as the shareholder response to the plans of the relatively new CEO at Prudential (on the job only 5 months and he thought this made sense). The challenge here is a general problem, but acute in government.
  4. A challenge is for governments need to know how to recognise market failure, and having identified this, decide what they should do it anything. Is there market failure in funding medical research, is there market failure in higher education? Understanding this will help define the boundaries of the government role, and importantly define the boundary conditions that tell us that different logic and problem solving is needed. At the root, we need to  first decide what the role of government should really be. Integral to this is determining a proportional response — in other words, there is identifying the need for intervention, and there is separately deciding what to do, how much to do, and importantly when to stop.
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