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The Arbuthnott Formula

The Arbuthnott Formula. NRAC 1 st meeting 24 February 2005. Background. Scotland-wide formula, introduced in 2001. Allocates resources for Hospital and Community Health Services (HCHS) activity across Scotland’s 15 Health Boards £6billion in 2005-06

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The Arbuthnott Formula

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  1. The Arbuthnott Formula NRAC 1st meeting 24 February 2005

  2. Background • Scotland-wide formula, introduced in 2001. • Allocates resources for Hospital and Community Health Services (HCHS) activity across Scotland’s 15 Health Boards • £6billion in 2005-06 • Does not determine the total amount of resources required to meet the needs of a Health Board, but distributes resources to NHS Boards according to relative need.

  3. Structure • Designed to reflect need. • Need is measured as utilisation – use is a proxy of need. • Updated annually. • Overall share for each Health Board is calculated by taking the population share and adjusting it for: • Age/Sex • Deprivation • Remoteness

  4. Population • Takes account of changes in Health Board population shares. • Based on the annually updated Mid-Year Estimates. • Three adjustments applied to the population of each NHS Board giving rise to a weighted population for each NHS Board, which differs from the raw population count.

  5. Age/Sex Characteristics • Takes account of: • the use made of different specialties by each age/sex group; • differences in the lengths of stay; and • costs of treatment and the way these costs are affected by length of stay.

  6. Deprivation • Four key indicators are combined to give a single Arbuthnott deprivation adjustment (the Arbuthnott index). • The indicators are: • standardised mortality rates of people under 65; • the unemployment rate; • proportion of elderly people who claim income support; • households with 2 or more indicators of deprivation as drawn from the 1991 Census.

  7. Remoteness • Relationship between road kilometres per 1,000 population and the relative costs of hospital services for the residents in different Health Boards. • Adjustment based on an estimate of the relationship between this indicator and the costs of hospital services using data for the previous three years. • Not considered appropriate to update the figures each year.

  8. Areas not covered • Unmet need • Those in most deprived areas of Scotland less likely to access healthcare services than those in most affluent areas. • Has implications for the way resources are allocated between NHS Boards. • Arbuthnott Committee recommended a further adjustment to the formula • Currently unmet need pilots examining how funding can be used to improve access to health services. • Family Health Services (FHS) • General Medical Services (GMS)

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