Intermediary Measures in Health System Performance Assessment

1. Intermediary Measures in Health System Performance Assessment

2. Intermediary Measures • Experience shows that when a health sector reformer seeks to understand the causes of unsatisfactory outcomes, certain characteristics of the system often play an important role. • These characteristics are not, in themselves, either the root causes of performance difficulties or the manifestations of those difficulties at the level of ultimate outcomes. • These factors are named as intermediaryperformance characteristics, because they are critical links in the chains that connect root causes to ultimate performance goals.

3. Intermediary Measures • Intermediate performance characteristics that should be singled out for special attention: • Efficiency • Coverage • Quality

4. Efficiency

5. Efficiency • Efficiency measures whether healthcare resources are being used to get the best value for money.

6. Efficiency • Efficiency is concerned with the relation between resource inputs (costs, in the form of labor, capital,or equipment) and either intermediate outputs (numbers treated, waiting time, etc) or final health outcomes (lives saved, life years gained, quality adjusted life years (QALYs)).

7. Technical efficiency “doing things right”

8. E1i Max Max C1i Most Effective Intervention = E1i Technical Efficiency = * * D1 N1 DALY1 I11 C11 E11 I12 C12 E12 I13 C13 E13 I14 C14 E14 E1i Is The Percent Reduction In DALY Lost DALY Saved For I11 (Most Effective Intervention)= DALY1 × E11 Total Cost = N1 × C11 Usually we have not enough resources for using the most effective interventions DALY Saved For I12 (Technically Efficient Intervention)= DALY1 × E12 Total Cost = N1 × C12 DALY1 × E11>DALY1 × E12 Shift from Most Effective to Technically Efficient Is a Kind of Rationing

9. Technical efficiency • Technical efficiency refers to the physical relation between resources (capital and labor) and health outcome. • A technically efficient position is achieved when the maximum possible improvement in outcomes obtained from a set of resource inputs. • An intervention is technically inefficient if the same (or greater) outcome could be produced with less of one type of input.

10. Technical efficiency • Consider treatment of osteoporosis using alendronate. A recent randomized trial showed that a 10 mg daily dose was as effective as a 20 mg dose. The lower dose is technically more efficient.

11. Input quantities vs. input cost • Almost all main definitions take technical efficiency to refer only to input quantities, and not input costs in monetary terms

12. Economic Efficiency • The cost of any production process is, of course, influenced not only by the quantities of inputs used, but also by the cost of these inputs. • A production unit which is economically efficient will produce a given output for the minimum possible total input cost, or maximize output for a fixed value input budget. • Thus, an economically efficient firm is, by definition, a cost-minimiser.

13. Economic Efficiency • This formulation of economic efficiency is particularly important in considering health care interventions. • Clinicians (quite reasonably) tend frequently to focus on best practice in terms of inputs – but differences in relative input prices may mean that a technically efficient “best practice” is economically efficient in one country but not in another. • This possibility is clearly a key practical constraint upon attempts to produce truly international “evidence based medicine” and to develop easily generalizable cost-effectiveness results.

14. * * D1 N1 DALY1 I11 C11 E11 I12 C12 E12 I13 C13 E13 I14 C14 E14 * * D2 N2 DALY2 I21 C21 E21 I22 C22 E22 I23 C23 E23 I24 C24 E24 * * D3 N3 DALY3 I31 C31 E31 I32 C32 E32 I33 C33 E33 I34 C34 E34 * * D4 N4 DALY4 I41 C41 E41 I42 C42 E42 I43 C43 E43 I44 C44 E44 * * D5 N5 DALY5 I51 C51 E51 I52 C52 E52 I53 C53 E53 I54 C54 E54 * * D6 N6 DALY6 I61 C61 E61 I62 C62 E62 I63 C63 E63 I64 C64 E64 * * D7 N7 DALY7 I71 C71 E71 I72 C72 E72 I73 C73 E73 I74 C74 E74 * * D8 N8 DALY8 I81 C81 E81 I82 C82 E82 I83 C83 E83 I84 C84 E84 * * D9 N9 DALY9 I91 C91 E91 I92 C92 E92 I93 C93 E93 I94 C94 E94 Most Effective Intervention Most Efficient Intervention

15. * * D1 N1 DALY1 I11 C11 E11 I12 C12 E12 I13 C13 E13 I14 C14 E14 * * D2 N2 DALY2 I21 C21 E21 I22 C22 E22 I23 C23 E23 I24 C24 E24 * * D3 N3 DALY3 I31 C31 E31 I32 C32 E32 I33 C33 E33 I34 C34 E34 * * D4 N4 DALY4 I41 C41 E41 I42 C42 E42 I43 C43 E43 I44 C44 E44 * * D5 N5 DALY5 I51 C51 E51 I52 C52 E52 I53 C53 E53 I54 C54 E54 * * D6 N6 DALY6 I61 C61 E61 I62 C62 E62 I63 C63 E63 I64 C64 E64 * * D7 N7 DALY7 I71 C71 E71 I72 C72 E72 I73 C73 E73 I74 C74 E74 * * D8 N8 DALY8 I81 C81 E81 I82 C82 E82 I83 C83 E83 I84 C84 E84 * * D9 N9 DALY9 I91 C91 E91 I92 C92 E92 I93 C93 E93 I94 C94 E94 Moving from less effective interventions To Most Effective Intervention Most Efficient Intervention

16. * * D1 N1 DALY1 I11 C11 E11 I12 C12 E12 I13 C13 E13 I14 C14 E14 * * D2 N2 DALY2 I21 C21 E21 I22 C22 E22 I23 C23 E23 I24 C24 E24 * * D3 N3 DALY3 I31 C31 E31 I32 C32 E32 I33 C33 E33 I34 C34 E34 * * D4 N4 DALY4 I41 C41 E41 I42 C42 E42 I43 C43 E43 I44 C44 E44 * * D5 N5 DALY5 I51 C51 E51 I52 C52 E52 I53 C53 E53 I54 C54 E54 * * D6 N6 DALY6 I61 C61 E61 I62 C62 E62 I63 C63 E63 I64 C64 E64 * * D7 N7 DALY7 I71 C71 E71 I72 C72 E72 I73 C73 E73 I74 C74 E74 * * D8 N8 DALY8 I81 C81 E81 I82 C82 E82 I83 C83 E83 I84 C84 E84 * * D9 N9 DALY9 I91 C91 E91 I92 C92 E92 I93 C93 E93 I94 C94 E94 Moving from less effective interventions To Most effective interventions Most Effective Intervention Most Efficient Intervention

17. Performance Cost

18. Performance B Cost A Moving from less effective interventions To Most effective interventions

19. * * D1 N1 DALY1 I11 C11 E11 I12 C12 E12 I13 C13 E13 I14 C14 E14 * * D2 N2 DALY2 I21 C21 E21 I22 C22 E22 I23 C23 E23 I24 C24 E24 * * D3 N3 DALY3 I31 C31 E31 I32 C32 E32 I33 C33 E33 I34 C34 E34 * * D4 N4 DALY4 I41 C41 E41 I42 C42 E42 I43 C43 E43 I44 C44 E44 * * D5 N5 DALY5 I51 C51 E51 I52 C52 E52 I53 C53 E53 I54 C54 E54 * * D6 N6 DALY6 I61 C61 E61 I62 C62 E62 I63 C63 E63 I64 C64 E64 * * D7 N7 DALY7 I71 C71 E71 I72 C72 E72 I73 C73 E73 I74 C74 E74 * * D8 N8 DALY8 I81 C81 E81 I82 C82 E82 I83 C83 E83 I84 C84 E84 * * D9 N9 DALY9 I91 C91 E91 I92 C92 E92 I93 C93 E93 I94 C94 E94 Moving from most effective intervention To Most efficient interventions But we have not enough resources to ensure delivery of most effective interventions Most Effective Intervention Most Efficient Intervention

20. * * D1 N1 DALY1 I11 C11 E11 I12 C12 E12 I13 C13 E13 I14 C14 E14 * * D2 N2 DALY2 I21 C21 E21 I22 C22 E22 I23 C23 E23 I24 C24 E24 * * D3 N3 DALY3 I31 C31 E31 I32 C32 E32 I33 C33 E33 I34 C34 E34 * * D4 N4 DALY4 I41 C41 E41 I42 C42 E42 I43 C43 E43 I44 C44 E44 * * D5 N5 DALY5 I51 C51 E51 I52 C52 E52 I53 C53 E53 I54 C54 E54 * * D6 N6 DALY6 I61 C61 E61 I62 C62 E62 I63 C63 E63 I64 C64 E64 * * D7 N7 DALY7 I71 C71 E71 I72 C72 E72 I73 C73 E73 I74 C74 E74 * * D8 N8 DALY8 I81 C81 E81 I82 C82 E82 I83 C83 E83 I84 C84 E84 * * D9 N9 DALY9 I91 C91 E91 I92 C92 E92 I93 C93 E93 I94 C94 E94 Moving from most effective intervention To Most efficient interventions Most Effective Intervention Most Efficient Intervention

21. Effectiveness to Technical Efficiency Rationing Performance B Cost C A Moving from most effective intervention To Most efficient interventions

22. Performance Cost C A Moving from a more costly, less effective intervention to most efficient intervention usually is the case

23. Allocative efficiency “doing the right things”

24. DALY1×E12 DALY2×E23 DALY3×E33 DALY4×E41 DALY5×E53 DALY6×E64 DALY7×E72 DALY8×E81 DALY9×E92 * * D1 N1 DALY1 I11 C11 E11 I12 C12 E12 I13 C13 E13 I14 C14 E14 * * D2 N2 DALY2 I21 C21 E21 I22 C22 E22 I23 C23 E23 I24 C24 E24 * * D3 N3 DALY3 I31 C31 E31 I32 C32 E32 I33 C33 E33 I34 C34 E34 * * D4 N4 DALY4 I41 C41 E41 I42 C42 E42 I43 C43 E43 I44 C44 E44 * * D5 N5 DALY5 I51 C51 E51 I52 C52 E52 I53 C53 E53 I54 C54 E54 * * D6 N6 DALY6 I61 C61 E61 I62 C62 E62 I63 C63 E63 I64 C64 E64 * * D7 N7 DALY7 I71 C71 E71 I72 C72 E72 I73 C73 E73 I74 C74 E74 * * D8 N8 DALY8 I81 C81 E81 I82 C82 E82 I83 C83 E83 I84 C84 E84 * * D9 N9 DALY9 I91 C91 E91 I92 C92 E92 I93 C93 E93 I94 C94 E94 Moving from Technical Efficiency To Allocative Efficiency But we have not even enough resources to ensure delivery of most efficient interventions DALY gain if we adhere to technical efficiency in all problems Most Effective Intervention Most Efficient Intervention

25. DALY1×E12 DALY2×E23 DALY3×E33 DALY4×E41 DALY5×E53 DALY6×E64 DALY7×E72 DALY8×E81 DALY9×E92  Technical Efficiency to Allocative Efficiency Rationing * * × D1 N1 DALY1 I11 C11 E11 I12 C12 E12 I13 C13 E13 I14 C14 E14 * *  D2 N2 DALY2 I21 C21 E21 I22 C22 E22 I23 C23 E23 I24 C24 E24 * * × D3 N3 DALY3 I31 C31 E31 I32 C32 E32 I33 C33 E33 I34 C34 E34 * *  D4 N4 DALY4 I41 C41 E41 I42 C42 E42 I43 C43 E43 I44 C44 E44 * *  D5 N5 DALY5 I51 C51 E51 I52 C52 E52 I53 C53 E53 I54 C54 E54 * * × D6 N6 DALY6 I61 C61 E61 I62 C62 E62 I63 C63 E63 I64 C64 E64 * *  D7 N7 DALY7 I71 C71 E71 I72 C72 E72 I73 C73 E73 I74 C74 E74 * * × D8 N8 DALY8 I81 C81 E81 I82 C82 E82 I83 C83 E83 I84 C84 E84 * * D9 N9 DALY9 I91 C91 E91 I92 C92 E92 I93 C93 E93 I94 C94 E94 Moving from Technical efficiency To Allocative Efficiency Selecting the right set of technically efficient interventions Most Effective Intervention Most Efficient Intervention

26. Allocative efficiency • To inform resource allocation decisions in broader context a global measure of efficiency is required. • The concept of allocative efficiency takes account not only of the productive efficiency with which healthcare resources are used to produce health outcomes but also the efficiency with which these outcomes are distributed among the community. • Such a societal perspective is rooted in welfare economics and has implications for the definition of opportunity costs.

27. Allocative Efficiency • Thus allocative efficiency is conventionally defined as being achieved in a situation in which it is impossible to improve the welfare of anyone without reducing the welfare of someone else through a change in the output combination (the achievement of a Pareto-optimal state). • Explicitly, technical and economic efficiency are necessary but not sufficient conditions for allocative efficiency to be achieved.

28. Allocative Efficiency -Definition • “It [the firm]…produces the correct mix of outputs, given output prices, uses the correct mix of inputs, given input prices, and adopts the correct scale given input and output prices: this is what allocative efficiency requires.” Knox Lovell and Schmidt (1988)

29. Technological efficiency “moving to new right things”

30. * * D1 N1 DALY1 I11 C11 E11 I12 C12 E12 I13 C13 E13 I14 C14 E14 * * D2 N2 DALY2 I21 C21 E21 I22 C22 E22 I23 C23 E23 I24 C24 E24 * * D3 N3 DALY3 I31 C31 E31 I32 C32 E32 I33 C33 E33 I34 C34 E34 * * D4 N4 DALY4 I41 C41 E41 I42 C42 E42 I43 C43 E43 I44 C44 E44 * * D5 N5 DALY5 I51 C51 E51 I52 C52 E52 I53 C53 E53 I54 C54 E54 * * D6 N6 DALY6 I61 C61 E61 I62 C62 E62 I63 C63 E63 I64 C64 E64 * * D7 N7 DALY7 I71 C71 E71 I72 C72 E72 I73 C73 E73 I74 C74 E74 * * D8 N8 DALY8 I81 C81 E81 I82 C82 E82 I83 C83 E83 I84 C84 E84 * * D9 N9 DALY9 I91 C91 E91 I92 C92 E92 I93 C93 E93 I94 C94 E94 Technology Push to more effective but not necessarily more efficient interventions Most Effective Intervention Most Efficient Intervention

31. New Technology * * D1 N1 DALY1 I11 C11 E11 I12 C12 E12 I13 C13 E13 I14 C14 E14 * * D2 N2 DALY2 I21 C21 E21 I22 C22 E22 I23 C23 E23 I24 C24 E24 * * I35 C35 E35 D3 N3 DALY3 I31 C31 E31 I32 C32 E32 I33 C33 E33 I34 C34 E34 * * D4 N4 DALY4 I41 C41 E41 I42 C42 E42 I43 C43 E43 I44 C44 E44 * * I55 C55 E55 D5 N5 DALY5 I51 C51 E51 I52 C52 E52 I53 C53 E53 I54 C54 E54 * * D6 N6 DALY6 I61 C61 E61 I62 C62 E62 I63 C63 E63 I64 C64 E64 * * I75 C75 E75 D7 N7 DALY7 I71 C71 E71 I72 C72 E72 I73 C73 E73 I74 C74 E74 * * I85 C85 E85 D8 N8 DALY8 I81 C81 E81 I82 C82 E82 I83 C83 E83 I84 C84 E84 * * I95 C95 E95 D9 N9 DALY9 I91 C91 E91 I92 C92 E92 I93 C93 E93 I94 C94 E94 Technology Push to more effective but not necessarily more efficient interventions Most Effective Intervention Most Efficient Intervention

32. New Technology * * D1 N1 DALY1 I11 C11 E11 I12 C12 E12 I13 C13 E13 I14 C14 E14 * * D2 N2 DALY2 I21 C21 E21 I22 C22 E22 I23 C23 E23 I24 C24 E24 * * I35 C35 E35 D3 N3 DALY3 I31 C31 E31 I32 C32 E32 I33 C33 E33 I34 C34 E34 * * D4 N4 DALY4 I41 C41 E41 I42 C42 E42 I43 C43 E43 I44 C44 E44 * * I55 C55 E55 D5 N5 DALY5 I51 C51 E51 I52 C52 E52 I53 C53 E53 I54 C54 E54 * * D6 N6 DALY6 I61 C61 E61 I62 C62 E62 I63 C63 E63 I64 C64 E64 * * I75 C75 E75 D7 N7 DALY7 I71 C71 E71 I72 C72 E72 I73 C73 E73 I74 C74 E74 * * I85 C85 E85 D8 N8 DALY8 I81 C81 E81 I82 C82 E82 I83 C83 E83 I84 C84 E84 * * I95 C95 E95 D9 N9 DALY9 I91 C91 E91 I92 C92 E92 I93 C93 E93 I94 C94 E94 Technology Push to more effective but not necessarily more efficient interventions Most Effective Intervention Most Efficient Intervention

33. Performance Cost Flat of Curve Development C A Effect of Technology Development

34. * * D1 N1 DALY1 I11 C11 E11 I12 C12 E12 I13 C13 E13 I14 C14 E14 * * D2 N2 DALY2 I21 C21 E21 I22 C22 E22 I23 C23 E23 I24 C24 E24 * * I35 C35 E35 D3 N3 DALY3 I31 C31 E31 I32 C32 E32 I33 C33 E33 I34 C34 E34 * * D4 N4 DALY4 I41 C41 E41 I42 C42 E42 I43 C43 E43 I44 C44 E44 * * I55 C55 E55 D5 N5 DALY5 I51 C51 E51 I52 C52 E52 I53 C53 E53 I54 C54 E54 * * D6 N6 DALY6 I61 C61 E61 I62 C62 E62 I63 C63 E63 I64 C64 E64 * * I75 C75 E75 D7 N7 DALY7 I71 C71 E71 I72 C72 E72 I73 C73 E73 I74 C74 E74 * * I85 C85 E85 D8 N8 DALY8 I81 C81 E81 I82 C82 E82 I83 C83 E83 I84 C84 E84 * * I95 C95 E95 D9 N9 DALY9 I91 C91 E91 I92 C92 E92 I93 C93 E93 I94 C94 E94 Technology Push to more effective but not necessarily more efficient interventions Most Effective Intervention Most Efficient Intervention

35. Performance Cost Steep of Curve Development B A Effect of Technology Development

36. * * D1 N1 DALY1 I11 C11 E11 I12 C12 E12 I13 C13 E13 I14 C14 E14 * * D2 N2 DALY2 I21 C21 E21 I22 C22 E22 I23 C23 E23 I24 C24 E24 * * I35 C35 E35 D3 N3 DALY3 I31 C31 E31 I32 C32 E32 I33 C33 E33 I34 C34 E34 * * D4 N4 DALY4 I41 C41 E41 I42 C42 E42 I43 C43 E43 I44 C44 E44 * * I55 C55 E55 D5 N5 DALY5 I51 C51 E51 I52 C52 E52 I53 C53 E53 I54 C54 E54 * * D6 N6 DALY6 I61 C61 E61 I62 C62 E62 I63 C63 E63 I64 C64 E64 * * I75 C75 E75 D7 N7 DALY7 I71 C71 E71 I72 C72 E72 I73 C73 E73 I74 C74 E74 * * I85 C85 E85 D8 N8 DALY8 I81 C81 E81 I82 C82 E82 I83 C83 E83 I84 C84 E84 * * I95 C95 E95 D9 N9 DALY9 I91 C91 E91 I92 C92 E92 I93 C93 E93 I94 C94 E94 Technology Push to more effective but not necessarily more efficient interventions Most Effective Intervention Most Efficient Intervention

37. Performance Cost Pseudo-development C A Effect of Technology Development

38. Technological Efficiency • Technological change occurs through the development of new processes which can produce more output for the same or less input than older processes; • The introduction of such a new process can be thought of as rendering all previous processes technically inefficient. • Under this view, “technology’ consists of the series of all known techniques for producing a particular output – although the invention of a new technique does not necessarily mean it will be available to all producers or all countries (Meier, 1995).

39. Technological Efficiency • Clearly, though, there is a difference between inefficiency due to operating off the isoquant for a given technology, as opposed to inefficiency due to failing to move to a different isoquant made possible by a new technology.

40. Efficiency Summary

41. 8 Performance 4 9 5 3 2 6 1 7 Cost Cost performance dilemmas 2- Save as much as possible without reducing outcomes 3- Improved efficiency to both lower cost and raise performance 4- Maximize performance for the current budget 5- Improve performance to such an extent that more money is required 6- Increase in cost without increase in performance 7- Increase in cost and decrease in performance 8- Increase in performance on the flat of the curve, 9- Increase in performance on the steep of the curve, 1- Accept somewhat reduced performance in order to significantly reduce cost

42. 8 Performance 4 9 5 3 2 6 1 7 Cost Cost performance dilemmas B C A Ministries of finance often argue that the nation is a point A and a change like 3 -more performance and lower cost-is required Countries like Brazil or Russia, which are growing, may be primarily concerned with improving performance—even if cost rises somewhat, as shown by 4 or 5 The ministry of health in contrast tends to argue that the system is at C and that move 9-more spending for more health-is the only appropriate response. Countries like Armenia or Tajikistan, in the aftermath of war or civil disorder, may find it necessary to focus on cost reduction, as shown by 1 or 2

43. Coverage

44. Effective coverage • Effective coverage is defined as the proportion of the population in need of an intervention who have received an effective intervention. • The numerator of the coverage ratio should indicate the number of population units (individuals, houses, villages) receiving effective interventions, • The denominator should refer to the population that would need the type of services indicated in the numerator.

45. Effective coverage • There are three main conceptual elements of effective coverage: access, utilization and effectiveness. • Access was defined in terms of availability, accessibility, affordability and acceptability. • Utilization was the combination of access and personal health behavior. • Effectiveness was considered a function of several variables, including efficacy, inputs (amount and quality of resources), quality assurance mechanisms (process of service delivery, provider performance), patient compliance and health behavior, and external factors (environmental, biological, social, etc.).

46. Effective Coverage Effectiveness patient compliance and health behavior, external factors (environmental, biological, social, etc.). quality assurance mechanisms (process of service delivery, provider performance), Efficacy inputs (amount and quality of resources) Utilization Access Affordability Acceptability personal health behavior Availability Accessibility

47. Effective coverage • Effective coverage is different from the effectiveness of the intervention itself. • For example, the effectiveness of DTP properly administered, is known to be high. • However, unless the quality of the vaccine and the administration can be ensured, effective coverage with DTP even among those receiving the vaccine, might be low.

48. Effective coverage • Some experts suggested that the term coverage with effective interventions be used instead of effective coverage. • They were of the opinion that effective coverage would best refer to the proportion of people for whom the health intervention had actually produced a desirable health outcome.

49. Coverage Dimensions • There are six different aspects of coverage, which could be analyzed in trying to determine where problems lay in achieving effective coverage. • Availability coverage • Accessibility coverage • Acceptability coverage • Affordability Coverage • Contact coverage • Effective coverage

50. Availability Coverage • The proportion of people for whom sufficient resources and technologies have been made available. • The ratio of resources to the total population in need. • The proportion of facilities, which offer specific resources, drugs, technologies, etc.