Health Economics and Access to Care: Are We Using the Wrong Model?

I woke one morning, many years ago, to the voice of a famous economist sounding off on my bedside radio. He spoiled the equanimity of my morning with his argument that the value of primary care should be evaluated by comparing the costs of the service with the health gain achieved by the service (in terms of quality adjusted life years [QALYs]). That is cobblers! Quite apart from the facile idea that the health gain from primary care can be calibrated with any kind of accuracy, the economist’s health economic model bypasses much of the purpose of healthcare. In this model, health care is simply as an instrument to improve health status. But a little thought will immediately show that health gain is a very incomplete understanding of the reason that people consult doctors. Health care serves a deep psychological need; human beings have turned to healers from the time that we became human beings. Health practitioners are not only valuable for the health gain they can now achieve, but also because they provide human warmth and support. The need for comfort, information, magic, and cure are all entangled. Not only do we need someone to turn out at times of mental or physical distress, but crucially, we also need to know that someone will be there for us when our time comes. And we need this assurance, even when we are perfectly healthy. We could perhaps wrap in the avoidance of catastrophic loss and call this the ‘insurance value’. Nor should the value of information – news about your own body – be underestimated. Berwick & Weinstein found that half of the benefit of an antenatal scan was simply to get a picture of the baby and had nothing to do with its medical purpose.[1]

The classical health economic model of cost utility analysis is well adapted to rationing demand once the patient’s condition has been defined. At that point calculating the relative value of different treatment options is a relatively straightforward issue (Figure 1). However, calculating the return-on-investment from simply providing access to healthcare is a different matter altogether. First, there is the extraordinarily difficult instrumental question of how to hypothecate the treatment effect over the full range of health conditions (Figure 2). Second, there is a need to factor in the value of:

  1. Information.
  2. Solace, comfort, support.
  3. Knowing that access will be available when required – the insurance value.

At the very least, it should recognise that cost-utility analysis for a calculation of a QALY or a DALY is not up to the task. The topic of access is one area where health economics raises many unsolved problems. In a recent news blog we discussed another issue that exposes some of the deep philosophical conundrums at the heart of health economics – the thorny issue of infertility.[2]

Fig 1. Management of a Specific Condition: a task for standard health economics

105 DCB - Health economics Fig 1

Fig 2. Providing Access to Healthcare: Health benefits are diffuse and hence hard to capture

105 DCB - Health economics Fig 2 

— Richard Lilford, CLAHRC WM Director


  1. Berwick DM, Weinstein MC. What do patients value? Willingness to pay for ultrasound in normal pregnancy. Med Care. 1985; 23(7): 881-93.
  2. Lilford RJ. The Health Economics of Infertility Treatment. NIHR CLAHRC West Midlands News Blog. 9 March 2018.

2 thoughts on “Health Economics and Access to Care: Are We Using the Wrong Model?”

  1. Dear Editor,
    I would prefer to define the medical care as a social practice of helping the people in their suffering related to the so-called diseases. Real or imaginable, treatable or not.
    Unfortunately, many strangers to medicine tend to believe that:
    1) this is a multitool of interventions tested in trials and
    2) it would be better if doctors will prevent diseases.
    As an example of the extreme of the second, recently one top-seated economists in Russia proposed to measure the efficacy of medicine by the prolongation of the healthy life. Of interest: when he was confronted by the statement that in this case sick people in need will be undesired clients of the doctor’s office, he just had smile.

  2. Thanks Richard. A similar issue arises in biological conservation (in which externalities, non-market goods, and no barriers to access abound: e.g. tragedy of the commons); wherei,n it is possible to assign a cash sum to an area of land or sea that does not encapsulate all its value (cf. defining quality with defining value), yet as a consequence of assigning a value a developer can pay that amount of money to take it away, or prevent someone for accessing a new medication because it only prvisdes 0.99 QALY not 1 QALY. QALYs are useful things to be able to talk to accountants, and occassionally we must do so. YEt wider represenation of true value and quality is an overall measure so we can talk to a broader audience is desirable.

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