Health Cheque
The point about the link between the country having a First World income and having a First World healthcare is well made and seldom appreciated.
”I have finally managed to sit down and finish Gareth Morgan’s book, Health Cheque, on the New Zealand health care system (long international flights are at least good for something). I find most of Morgan’s books a little superficial for my tastes and Health Cheque is certainly no exception, lacking, as it does, any deep insight into the current problems of our struggling health system. Having said that, I certainly thought the first half of the book gave a reasonably good overview of the political history of the health system. The brief look at some of the underlying social and epidemiological problems was also worthwhile. The point about the link between the country having a First World income and having a First World healthcare is well made and seldom appreciated. I am not convinced about his point that aging GPs, who will retire at precisely the same moment that all those baby boomers need to access health care, will throw the country into a health crisis. It seems to me that Boomers already access plenty of health care resources and there is no reason to think this will get a great deal worse. On the contrary, Boomers tend to be extremely health conscious and are likely to be less of a burden on health than the previous generation – or the next one after them. In addition, the really resource-intensive “last year of life” tends to draw on hospital resources rather than GPs.
But this is a minor niggle. The real problem with Morgan’s analysis is that Morgan is an economist rather than a medical professional.
Do not mistake me here. I wholeheartedly agree with his horror at the fact that some of the DHBs are unable to provide the simple cost of a procedure. This is utterly unacceptable and sadly rife throughout the DHB system. I am all for making rational decisions about prioritisation of limited resources and this financial ineptitude makes such prioritisation practically impossible. However, I am unimpressed with his using the dreadful QALY (Quality adjusted Life Year) to prioritise resources. A QALY is a measure of the amount and quality of life regained by a procedure.
Morgan is keen to use QALYs because it monetarises the benefit gained by a procedure. He is clearly happier in the world of dollar figures. Unfortunately, QALYs were originally intended to provide an objective measure for comparing two “like” procedures attempting to achieve the same outcome. For instance, QALYs are quite useful for comparing the outcomes of two different hip replacement procedures or whether, after a broken hip, a replacement provides a better set of outcomes than a simple internal fixation (plate and screw). Where QALYs die a horrible death is when they are used to compare two dissimilar procedures with a differing set of outcomes. There is simply no way that you can compare a stomach stapling operation to a course of chemotherapy. Although it may look like the QALY is putting dollar figures to the procedures and allowing such a comparison, the underlying assumptions behind how the QALYs are created are vastly different in each circumstance. It is not merely comparing apples and oranges – at least they are both fruit – it is more like comparing aardvarks and spark plugs – you might be able to place dollar values on each, but a spark plug does little towards keeping down the ant population and your car would not do well with an aardvark instead of a spark plug.
Morgan unintentionally illustrates this nicely in Health Cheque. He berates National, and John Key in particular, for “compromising” Pharmac with their pledge to fund a full year of the chemotherapeutic drug Herceptin, used to treat breast cancer. Laying aside the fact that he completely fails to understand the reason why health professionals (not simply politicians) challenged Pharmac’s position – Pharmac based their suggested 8 week course on a subset of a single study, ignoring the vast weight of literature on the year-long course – Morgan suggests that the price of $100,000 per QALY was too steep. The very next page, he is justifying the treatment of haemophiliacs at a cost of $75,000 to $130,000 per QALY, apparently on the basis that this is a congenital disease and is not their fault (Breast cancer is the woman’s fault????). The QALY argument being used here is merely a proxy for making a value judgment of whether a extra year of life for a 16 year old haemophiliac is worth more than than an extra year of life for a 25 year old mother with three children below the age of 6. Clearly, this is not a value judgement than can be made by anyone – let alone an economist!
Morgan’s love of hard numbers crops up again when he praises the CPAC (Clinical Priority Access Criteria) system – the infamous “points” system that determines whether you can access a specialist appointment or a procedure. Unfortunately, he appears to fail to realise that the system is inconsistent and very subjective and, worst of all, entirely driven by funding decisions rather than genuine clinical need. It is CPAC that ensures that the waiting list is no longer than 6 months – by refusing access to all but the sickest people, despite the fact that this hides the extent of the need and is an exceedingly inefficient way of allocating resources. Waiting until a patient is critically ill instead of attending to his/her disease process at an early stage is not only dubious ethically but is massively wasteful of resources – late operations cost many times the amount of early interventions.
Health planning requires hard data. Morgan is bang on the money when he says:
“The big problem is that the quality of reporting in our health system is still pretty poor, yet this is an essential starting point for a more mature, depoliticised debate about healthcare in New Zealand.”
There are many ways we can improve that situation such as better, more robust IT systems; proper dedicated data capturers (as opposed to disinterested nurses and doctors); the simplification of administrative tasks to avoid duplication of data and data corruption. But in the process of making rational decisions about our healthcare, we should not overlook that these are real people we are dealing with, not abstract numbers. While we may have good reason for preferring to fund another couple of angioplasties rather than Mrs. T’s hip replacement, we should always bear in mind that we have condemned Mrs. T to another pain-filled year of immobility and possibly a fall and broken hip. We might even be condemning her to death. No amount of rational argument should be allowed to obscure this fact.
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Feb 25 10 9:32 am
Remember the Gibbs Report?
Its slightly gruesome that 20 years later we are back asking the same basic questions on cost!
JC
Mar 2 10 5:20 pm
Hi, I am the co-author of Health Cheque. As you may know, Gareth is in Chile at the moment, so I had a chat with him about your blog and here is our reply.
Thanks for taking the time to read the book. There seems to be a lot of points to agree on, but as you say your key gripe is an economist wading into the prioritisation debate.
It seems that you refuse to accept there is a limited amount of $ to go around and it has to be rationed – so we need a framework that is equitable. That’s a fact of life – but its not clear how you would deal with that reality. It’s no good being all touchy feely for the inevitable case that falls below the cut, you have to give a rationale that DOES decide between a hip replacement and a cancer case. Your post seems to be incapable of accepting that simple fact. You also want more data but haven’t told us how you’d use that date to make the proper calls. As for your proposition that a politician somehow knew better than Pharmac over Herceptin, there is no basis on which to prove that – just like Key had no basis for his decision.
QALYs represent the best of our knowledge. They are not perfect but they are a good starting point for a rational conversation. Naturally there has to be room for medical input and public perceptions too – just as happens with Pharmac now. There are tough calls here but someone has to start making them. We look forward to hearing how you would do so.
Mar 2 10 10:18 pm
Hi, Geoff. Thanks for taking the time to comment.
I am under no illusions that there is a limited amount of money available for health. I also completely agree that there needs to be a rational discussion on prioritisation. Where we disagree is on the use of QALYs to determine unlike comparisons, as I have outlined in my post (they are quite useful for comparing similar procedures). QALYs were never designed for this sort of non-equivalent comparison and there is no statistical validity to using them this way. You then illustrate this by comparing QALYs for Herceptin and Haemophilia – two completely un-alike treatments
You do not appear to have done much research into the Herceptin issue. I refer you to my post detailing the case against Pharmac. I also note that I am unaware of any oncologist who supported Pharmac’s flimsy decision. Though National’s decision to fully fund a year’s Herceptin was undoubtably populist-driven, it had the support of the medical community for sound clinical reasons.
Mar 3 10 8:47 am
I agree the book makes good points about the limited resources available for health care and the obvious need to ration. I’ve never met a rational health care worker that was unaware of this. What the book does though is fall into the usual trap for commentators on these subjects and focusses on procedural health. Most health care is not procedural and the costs incurred are not the result of operations (or even any treatment) happening. It is easy to talk about access to surgical procedures and waiting lists, but ultimately they make up less than half the expenditure in the sector.
The more realistic approach is to consider episodes of care, and to make rational decisions about what is acceptable within specific episodes based on clinical factors and likely outcome. QALYs and other measures can then be used appropriately within an episode of care or disease management plan. We shouldn’t forget, most medicine isn’t about a single diagnosis , and single intervention . The real issues involve deciding how far we are prepared to go, for what benefit, and at what cost.
Mar 3 10 2:59 pm
Good point about the procedural nature of most rationing decisions. I, too, like the episodes of care model, but it is even harder to define proper comparisons than comparing dissimilar QALYs and almost impossible to get costings as each episode is very individualised.
Mar 3 10 2:56 pm
Firstly I totally agree with Ian’s comments. We didn’t go into the hows of prioritisation in the book because there wasn’t room. But this is very much where we have ended up. And we think this work on clinical pathways could be informed by the evidence on QALYs.
The “MacDoctor” has a point that you can’t pick and choose two different QALYs from different studies and compare them. But that is a 90′s criticism, analysis is way more sophisticated than that now. QALYs (or whatever your measure of cost effectiveness is) can be developed consistently depending on what you want to compare. It just takes a bit more work. Again, its not perfect, but it represents our best knowledge to inform a rational decision. Provided your aim is getting the maximum extra quality life for each dollar spent. This may not be the only thing we want from our healthcare dollar, but its a big part of it.
I read your article on Herceptin. Again, nice points but no answers and I wasn’t convinced. Someone has to make the hard calls, and I would still rather Pharmac did it with their process (which can always be improved) rather than political whims. Pharmac is easy to bag, but go anywhere in the world and they are jealous of it.
Oncologists may well call for Herceptin now, but if you gave them a fixed budget and told them to work out clinical pathways for all cancer treatment as Ian suggests, would Herceptin make the cut? That is the real test.
Mar 3 10 3:25 pm
But that is a 90’s criticism, analysis is way more sophisticated than that now.
I am more inclined to the view that analysts are simply more cunning about hiding their fudged data and assumptions. But I confess to being terminally cynical when it comes to statisticians.
In any case I still believe it is not possible to equate the “worth” of years of mobility for an elderly lady (hip replacement) with a few months of life for a mother of three young children (Herceptin). All QALY calculations I have seen ( some as recent as three years ago) contain ethical considerations that are simply not transferable from one calculation to another. But I suspect we will have to agree to disagree on this one.
I read your article on Herceptin. Again, nice points but no answers
The answer was (in case you didn’t spot it) – fund a year’s worth of Herceptin until you have proper data that a 9 week course is as effective. Where that funding comes from is, of course, an entirely different argument and not one within the ambit of Pharmac.
Mar 4 10 2:31 pm
QALYs imply that a year of full quality life is valued equally for everyone. Quality of life is taken into account as a partial QALY – using the same sort of disability surveys that ACC use to determine compensation. This seems like a pretty reasonable starting point to me (as stated before it isn’t everything). If you can’t stomach that, please suggest another way to prioritise. Don’t dodge the need to decide where to spend money.
So we should have funded a year course of Herceptin? I don’t know how you can make that call, and then wash your hands of the fiscal implications. We give Pharmac a stack of money and ask them to maximise our health return. Surely the answer is to give Pharmac more money and let them decide the best place to put it. They might well choose Herceptin, or they surprise you and might find a better use for the money.
The major point is this. We spend a large chunk of our health care budget on treatments of marginal value, particularly at the end of life or on patients that know how to lobby. Meanwhile we have third world vaccination rates among Maori and relatively poor health among young people. We are not spending our money effectively. It seems to me that an impartial, evidence based approach (with huge clinical input) is the only way to get some sense back in our health spending.