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Social value judgements

Public health and health
improvement: return on
BHF Sustaining Hearty Lives - Workshop , London. 5th October 2011
Professor Mike Kelly
Director of the Centre for Public Health Excellence
The National Institute for Health and Clinical Excellence (NICE)

promotion of good health and the
prevention and treatment of ill health.
Audiences for public health
Local government
The workplace
The utilities
DH and other government
The public
National policy makers
The pillars of our work
Methodological principles governing
all NICE’s work
Base recommendations on the
best available evidence.

To determine cost effectiveness
using the QALY.

To be clear about scientific and
other values

To allow contestability.
To be seen to be and to be
independent of government, the
pharmaceutical industry and
other vested interests.

NICE methods for public health
The NICE public
health guidance
development process

An overview for
stakeholders, including
public health practitioners,

policy makers and the

NICE’s current economic approach
• NICE uses a standard set of methods to assess cost- • The main method, cost utility analysis, considers the quality of life someone will experience as well as the extra life they will gain, as a result of intervening in a particular way.
• For public health interventions, the perspective adopted is usually that of the NHS or public sector. • The costs of lost production due to illness or incapacity • The time horizon is chosen to ensure all important costs and effects are captured, in most cases a lifetime horizon. An annual discount rate of 3.5% is applied to the costs and benefits. • Sensitivity analyses are undertaken to handle • In general, interventions costing less than £20,000 per QALY are considered by NICE to be cost effective. • Interventions costing between £20,000 to £30,000 per QALY may be considered cost effective if certain conditions are satisfied. • NICE does not usually recommend an intervention if it costs more than £30,000 per QALY (other than for certain end of life treatments) unless a strong case can be made that it is an effective use of NHS resources.
Assessing Cost Effectiveness
Guidance topic classification
PH1 Brief interventions and
referral for smoking cessation

Brief intervention only (5
£577 to £1
Background quit rate
Brief intervention (5 minutes
Background quit rate
plus nicotine replacement
£1664 to
therapy [NRT])
Brief intervention (5 minutes
Background quit rate
plus self-help)
£370 £292 to £847
PH2 Four commonly used
methods to increase physical

Exercise prescriptions
£20 to £159
Interviews with exercise
Intensive interviews
Exercise prescription and
exercise information
Exercise prescription with
intensive GP training
Intensive interviews with
exercise voucher
PH10 Smoking cessation

Background quit rate
Brief advice
Background quit rate
Nicotine patch – pharmacy consultation
Background quit rate
Nicotine patch – pharmacy consultation
+ behavioural programme

Brief advice plus self-help material
Background quit rate
Background quit rate
Brief advice plus self-help material plus

Brief advice plus self-help material plus Background quit rate
NRT plus specialist clinic

Less intensive counselling and
Background quit rate
More intensive counselling and
Background quit rate
Nicotine patch - group counselling
Background quit rate
Nicotine patch - individual counselling
Background quit rate
Nicotine patch – no counselling
Background quit rate
Return on investment
• Resource allocation at local level.
• Short, medium and long term returns.
• Financial returns and health gains.
Aim of the cost impact project
To develop NICE’s approaches to cost effectiveness and cost impact to better inform local decisions about disinvestment and support the business case for investment in public health. • Stage 1: to examine current practice and explore and test methods for assessing the cost effectiveness and cost impact of public health interventions Three types of approach
1. Cost consequence analysis (CCA) describes the
costs of alternative interventions and lists all the health and non-health impacts (benefits) of the interventions. It does not attempt to summarise outcomes in a single measure (like the quality-adjusted life year) or in money terms. Instead, outcomes are listed in their natural units (some of which may be monetary) and it is left to decision-makers to determine whether, overall, the intervention is worth carrying out.
2. Cost–benefit analysis (CBA) compares the costs
and benefits of an intervention to assess whether it is worth doing. Both are measured using the same monetary units (for example, £s) to see whether benefits exceed costs.
3. Cost–utility analysis (CUA) compares the costs and
benefits of an intervention to assess whether it is worth doing. The benefits are assessed in terms of quality of life as well as quantity of life and expressed as quality-adjusted life-years (QALYs).
Workshops with commissioners and local decision makers Analysis of current approach to Cost effectiveness and cost impact. Review of existing Return on Investment methods and tools Interviews with commissioners and decision-makers Key Findings: ROIs
ROI review
• Cost effectiveness analysis and cost consequence
analysis dominate the published literature, cost utility analysis accounts for about 27% Testing ROI methods
• 22 different metrics calculated for 10 PH interventions.
Different metrics produce different rankings resulting in different decisions.
• Overlap between metrics that produce differences and information required by decision makers for investment decisions: e.g. affordability, reach, avoided burden of disease, short run cost savings, productivity gains • Undertake CCA to capture all the health and non-health benefits and costs of public health interventions and report them in a disaggregated way [that makes most sense for each sector] • Undertake CBA to capture the wider costs and non-health benefits of public health interventions and to allow multiple outcomes to be compared in a single metric, money • Support the assessment of ROIs in the short, medium and long • Continue to undertake CUA of public health interventions using the QALY to ensure baseline comparability across the UK healthcare sector and across NICE programmes (i.e. technology appraisals and clinical guidelines) July 2011 New Referral
• To develop a prototype model for local authority commissioners showing the potential return on investment (ROI) for health improvement interventions.
• Initially the work will focus on tobacco control.
• Review existing models and costing tools to • Identify up to date data sources to populate the model • Develop scenario analyses around different intervention • Report health and non-health outcomes and costs in • Report ROI for short, medium and long term time KELLY, M.P. (2009) The individual and the social level in public health, in Killoran, A. & Kelly, M.P. (eds), Evidence
Based Public Health: Effectiveness and Efficiency, Oxford : Oxford University Press.
SWANN, C., OWEN, L.,CARMONA, C., KELLY, M.P., WOHLGEMUTH, C., HUNTLEY,J. (2009) A nudge in the right
direction: developing guidance on changing behaviour, in Killoran, A. & Kelly, M.P. (eds), Evidence Based Public
Health: Effectiveness and Efficiency, Oxford : Oxford University Press.
BAXTER, S. KILLORAN, A., KELLY, M.P., GOYDER. E. (2010) Synthesising diverse evidence: the use of primary
qualitative data analysis methods and logic models in public health reviews. Public Health 124: 99-106
KELLY, M.P. (2010) The axes of social differentiation and the evidence base on health equity. Journal of the
Royal Society of Medicine, 103: 266-72, DOI .1258/jrsm.2010.100005
KELLY, M.P. (2010) A theoretical model of assets: the link between biology and the social structure. In Morgan, A.
Davies, M ., Ziglio, E. (eds) Health Assets in a Global Context: Theory, Methods, Action, , New York: Springer.
KELLY, M.P., MORGAN, A., ELLIS, S., YOUNGER, T., HUNTLEY, J., SWANN, C. (2010) Evidence based public health: A
review of the experience of the National Institute of Health and Clinical Excellence (NICE) of developing public health
guidance in England , Social Science and Medicine, 71 :1056 - 1062
OWEN, L., MORGAN, A., FISCHER, A., ELLIS, S., HOY, A., KELLY, M.P. (2011) The cost effectiveness of public health
interventions, Journal of Public Health , in press


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