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Resource Allocation in Health Care

Resource Allocation in Health Care. Shelley McGee PCMA WITS B.Pharm IV 8th August 2011. Recap of previous work. What is Resource Allocation?. Distribution of resources – usually financial among competing groups of people or programmes 3 distinct levels of decision-making:

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Resource Allocation in Health Care

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  1. Resource Allocation in Health Care Shelley McGee PCMA WITS B.Pharm IV 8th August 2011

  2. Recap of previous work

  3. What is Resource Allocation? • Distribution of resources – usually financial among competing groups of people or programmes • 3 distinct levels of decision-making: • Level 1: Allocating resources to healthcare versus other social needs • Level 2: Allocating resources within the healthcare sector • Level 3: Allocating resources among individual patients

  4. Why is Resource Allocation needed? • Increasing demand for healthcare services • Rising costs of healthcare • Demand outstrips the resources available • Requires: • Rationing • Priority setting • Difficult decisions have to be taken

  5. Economic Principles in Priority Setting • Opportunity Cost • By investing resources in one way, some opportunity to invest in another way is lost. • The Margin • Shifting or changing the resource mix • How best to invest additional funds • How most efficiently to use existing resources

  6. Ethical issues • Should we invest more resources into healthcare versus other areas? • Distribution of resources will benefit some and not others – how should choices be made? What values should influence? • Is the current distribution of resources fair and equitable? • Is the current distribution of resources efficient?

  7. Priorities • Priorities are not lexicographic • It is not possible for us to order our expenditure in such a way as to take care of our total want from Priority 1 and then move on to Priority 2 • Priorities are also a function of benefits and costs – which may be highly subjective and valued differently.

  8. Multiple criteria for resource allocation • Very uncommon for one aspect considered to override a resource allocation decision. • Decisions are complex and priorities differ. • Ad-hoc priority setting often results in inefficient and emotive distribution of resources • Decisions may be inconsistent • Multi-Criteria decision analysis (MCDA) has been suggested as a possible solution to assist decision-makers

  9. Multi-Criteria Decision Analysis • Examples of factors which might be included: • Cost effectiveness • Budget Impact • Severity of the disease area in question • Also sometimes called burden of disease • Equity Analysis • Vulnerable populations • Availability of alternative options

  10. Workshop exercise • Resource allocation in a hospital setting

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