The universal provision of public services - including health health - is unaffordable.

SAMI has been involved in projects relating to the future of the NHS, both specifically for the NHS Institute, as well as part of the broader study of the Future of Services to the Public that was undertaken last year. Many of the key issues focus on the unaffordability of continued universal access to services, and the need either for rationing or individual co-payment – or a combination. The problem is compounded by the political unacceptability of a debate around “rationing”. One area of the NHS where rationing has been more explicit is that of access to medicines. For many years now, The National Institute for Health and Clinical Excellence – still known by its original acronym, NICE – has been making recommendations to the Department of Health regarding which medicines should be available under the NHS, in terms of whether they offer value for money. Many of the recommendations have been controversial, sparking sharp reactions from affected patient groups; some recommendations have been overridden by political considerations. NICE also evaluates other forms of medical intervention, but is the recommendations on access to medicines – especially new therapies – which have produced most controversy.

There are also controversies among health economists regarding the methodologies employed by NICE. The standard measure of health output used by NICE is the quality-adjusted life year (QALY). This is intended to embrace both extra life years as well as the quality of life experienced during those additional years, with new therapies being rated in terms of their cost per QALY. However, the QALY may not capture all the relevant aspects of the social value of healthcare expenditure. For example, male impotence cures (and even tattoo removal) show a relatively lower cost per QALY, but can be argued to merit a lower social valuation in terms of resource allocation. Whereas some orphan drugs (specialised therapies for very small patient groups) and end-stage cancer treatments may well merit much higher social valuation, but tend to produce a much higher costs per QALY and so would receive a more negative assessment from NICE.

The use of such cost-effectiveness techniques to evaluate medicines is far from universal. Health economic assessments do not play a widespread role even among EU countries, although they exist to some extent in many of them. In many countries, the strict economic evaluations are assessed alongside other criteria such as the availability of alternative treatments; the seriousness of the medical condition; affordability for patients; financial implications for governments; and equity issues. Among recent meetings that have sought to stimulate further the debate on these issues was one organised by The Tomorrow Project at The Royal Society on 18th February, at which one of the speakers was Sir Michael Rawlins, Chairman of NICE. The role of genetics was highlighted as being profound in its potential implications, but also being an uncertainty regarding its impact on future costs of therapy. In addition, the high and rising costs of new drug development are due in part to the demand for high public safety. Increasing numbers of affordable medicines combined with a hundred percent safety might not be reconcilable. These issues represent areas where the use of scenarios can serve to highlight the challenges and options for government and society.

Michael Owen
February 2008