Assessing value in health care is based on outcome. The policy that is implemented to analyze value must be one that is specific to the healthcare

Chapter 12 The Policy Analysis Process: Analysis of Values

An analysis that considers technological capabilities, economic outcomes, and political support will usually point toward a single health policy recommendation. Yet any final recommendation must take into account values, especially where there are competing trade-offs. You might ask this: Does not the political process, which a recommendation often goes through before it can be adopted and implemented, take care of those value concerns? Do not decision makers reflect their personal values and those of their constituencies in the positions they take during a policy debate and in their votes? Yes, the political process will reflect the current wider conflicts in American society over social mores, the nature of human life, the role of government, the economic marketplace, and collective versus individual rights. In this chapter, however, we consider some value issues relating specifically to health care and the health care professions. These values may or may not be considered in the political process and should be assessed as part of any robust analysis.

Value issues discussed briefly in this chapter include:

• Equitable access

• Efficiency and value

• Patient privacy and confidentiality

• Informed consent

• Personal responsibility

• Quality, variability, and malpractice reform

• Professional ethics

• Consumer sovereignty

Social welfare

• Rationing

• Process equity

This chapter ends with the broader question of how a wide range of social institutions might be influenced by the growth of the medical sector of the economy.

12.1 EQUITABLE ACCESS

Priester (1992) suggested that the United States should reorder its values to give the greatest emphasis to fair equity, which he defined as giving each individual access to an “adequate level of care.” Skipping over issues of residency and eligibility, he argued, “Assuring access to health care, regardless of cause or source of need, is society’s responsibility”; however, he added that “this does not require access to all potentially beneficial care” (p. 92). He maintained that this is the only approach that would not exceed the available resources or deprive some segments of society of their opportunity for a reasonably full life. He saw this as a floor, not a ceiling; someone with more personal resources could choose to consume more health services. He saw the U.S. system as overemphasizing provider autonomy, individualism, and assumed abundance. He felt that we have too often let economic considerations outweigh ethical ones.

A similar argument could be made for removing health disparities; among the major causes of which is differential access to care. The Affordable Care Act (ACA) has made a step in the direction of fair access by moving toward universal coverage and by calling for a defined essential benefit package.

12.2 EFFICIENCY AND VALUE

If resource scarcity leads society to overlook some populations or to restrict necessary services to them, then efficiency is important. “Waste not, want not” is not always a fundamental value in a system in which one person’s waste is another person’s enhanced income. Porter and Teisberg (2006) argued against a “zero-sum” mentality that attempts to maximize each individual provider’s share of the existing pie and favored reducing waste to enhance the value received by individual consumers. One could also promote the collective view that the services available to consumers collectively form a “zero-sum” game in which all will get more if the collective waste is minimized. One way or another, there is considerable merit in viewing waste negatively, rather than as enhanced income.

Because it is so hard to get individuals to pull together on efficiency and cost minimization, some policy experts have tended to emphasize “value.” We now have value-based compensation experiments that allow sharing of the savings with providers and provide compensation for higher-quality outcomes. The sense here is that there is value created when you get greater quality for the same cost or the same quality for lower cost, or both positive outcomes concurrently.

In a survey that asked health industry leaders to rank 11 areas of innovation for their potential impact in terms of quality and cost over the next 5 years, the highest ranking went to process improvement. The other innovation areas likely to contribute to both improved quality and cost were data analytics, nonphysician delivery alternatives, disease management, and alternatives to fee-for-service. The respondents believed innovations in diagnostics, pharmaceuticals, and electronic medical records would help with costs but not quality, and they forecasted a low likelihood of help along either dimension from consumer incentives or from basic research (Chin

et al., 2013). The good news is that process improvement is an area where any provider who wants to make a difference can contribute.

12.3 PATIENT PRIVACY AND CONFIDENTIALITY

Increasingly, electronic patient records, digitized information already collected for billing and claims, and specialized databases offer potential for finding out more about disease processes and care outcomes. At the same time, they offer possibilities for excluding individuals from care or for breeches of the confidentiality that one expects when encountering the health care system and is often guaranteed by laws such as the Health Insurance Portability and Accountability Act (HIPAA). News stories about stolen laptops with personal data crop up frequently. This is an area where trade-offs will continue to be difficult and frustrating, and it will continue to be important in policy analysis and decision making.

12.4 INFORMED CONSENT

Requirements for informed consent for patients and human subjects in research represent a constraint on provider autonomy. They add to the staff burden, but are a regulatory requirement. Table 12-1 illustrates part of the federal regulations governing informed consent by research subjects in federally funded research. You might ask yourself this: What values are represented here, and why were they made an added requirement of all research in the first place?

Table 12-1 Code of Federal Regulations Section 50, Subpart B, Informed Consent of Human Subjects

§50.20: General requirements for informed consent

Except as provided in 50.23 and 50.24, no investigator may involve a human being as a subject in research covered by these regulations unless the investigator has obtained the legally effective informed consent of the subject or the subject’s legally authorized representative. An investigator shall seek such consent only under circumstances that provide the prospective subject or the representative sufficient opportunity to consider whether or not to participate and that minimize the possibility of coercion or undue influence. The information that is given to the subject or the representative shall be in language understandable to the subject or the representative. No informed consent, whether oral or written, may include any exculpatory language through which the subject or the representative is made to waive or appear to waive any of the subject’s legal rights, or releases or appears to release the investigator, the sponsor, the institution, or its agents from liability for negligence.

Section 50.24 Basic elements of informed consent.

(a) In seeking informed consent, the following information shall be provided to each subject:

(1) A statement that the study involves research, an explanation of the purposes of the research and the expected duration of the subject’s participation, a description of the procedures to be followed, and identification of any procedures which are experimental. (2) A description of any reasonably foreseeable risks or discomforts to the subject. (3) A description of any benefits to the subject or to others which may reasonably be expected from the research. (4) A disclosure of appropriate alternative procedures or courses of treatment, if any, that might be advantageous to the subject. (5) A statement describing the extent, if any, to which confidentiality of records identifying the subject will be maintained and that notes the possibility that the Food and Drug Administration may inspect the records. (6) For research involving more than minimal risk, an explanation as to whether any compensation and an explanation as to whether any medical treatments are available if injury occurs and, if so, what they consist of, or where further information may be obtained. (7) An explanation of whom to contact for answers to pertinent questions about the research and research subjects’ rights, and whom to contact in the event of a research-related injury to the subject. (8) A statement that participation is voluntary, that refusal to participate will involve no penalty or loss of benefits to which the subject is otherwise entitled, and that the subject may discontinue participation at any time without penalty or loss of benefits to which the subject is otherwise entitled. (b) Additional elements of informed consent. When appropriate, one or more of the following elements of information shall also be provided to each subject: (1) A statement that the particular treatment or procedure may involve risks to the subject (or to the embryo or fetus, if the subject is or may become pregnant) which are currently unforeseeable. (2) Anticipated circumstances under which the subject’s participation may be terminated by the investigator without regard to the subject’s consent. (3) Any additional costs to the subject that may result from participation in the research. (4) The consequences of a subject’s decision to withdraw from the research and procedures for orderly termination of participation by the subject. (5) A statement that significant new findings developed during the course of the research which may relate to the subject’s willingness to continue participation will be provided to the subject. (6) The approximate number of subjects involved in the study. (c) When seeking informed consent for applicable clinical trials, as defined in 42 U.S.C. 282(j)(1)(A), the following statement shall be provided to each clinical trial subject in informed consent documents and processes. This will notify the clinical trial subject that clinical trial information has been or will be submitted for inclusion in the clinical trial registry databank under paragraph (j) of section 402 of the Public Health Service Act. The statement is: “A description of this clinical trial will be available on http://www.ClinicalTrials.gov, as required by U.S. Law. This Web site will not include information that can identify you. At most, the Web site will include a summary of the results. You can search this Web site at any time.”

(d) The informed consent requirements in these regulations are not intended to preempt any applicable Federal, State, or local laws which require additional information to be disclosed for informed consent to be legally effective. (e) Nothing in these regulations is intended to limit the authority of a physician to provide emergency medical care to the extent the physician is permitted to do so under applicable Federal, State, or local law. Source: Reproduced from: Code of Federal Regulations (2013, April 1). Protection of human subjects. Washington, D.C: Government Printing Office. Title 21, Volume 1, Part 50. Retrieved on December 17, 2013, at www.accessdata.fda.gov/scripts/cdrh/cfdocs/cfcfr/CFRSearch.cfm?CFRPart=50&showFR=1&su bpartNode=21:1.0.1.1.20.2.

12.5 PERSONAL RESPONSIBILITY

A significant portion of the cost of health care can be attributed to lifestyle choices, such as smoking, lack of exercise, overeating or poor nutrition, not wearing seat belts or cycling helmets, and use of drugs and alcohol. Many policy proposals seek to change the behavioral risk factors or shift those costs to the individuals at risk. Smokers pay higher insurance premiums for long-term care, for example. Some analysts have suggested that those involved in risky behaviors, such as not wearing motorcycle helmets, post a bond to cover their incremental medical care costs in case of an accident. Most people would agree that individuals should take more responsibility for their behavior rather than have it borne as a collective risk, but there is less agreement on the effort society should expend to make healthy choices more attractive. There is considerable evidence, for example, that the development choices we make—our built environment—can encourage or discourage physical activity. A politician asked to support a bill to encourage “walkability” or “multimodal transportation hubs,” however, may be inclined to attribute lack of exercise solely to, as one state legislator put it, “a lack of personal fortitude.”

The question of personal responsibility comes up repeatedly in debates about health reform and the ACA in particular. Key elements of the reform can be seen as an attempt to balance a society’s responsibility to ensure equitable access with an individual’s responsibilities. The individual mandate legislates personal responsibility, using tax fines to ensure that young, healthy people can pay for their own care if they need it and do their share to support a larger system they will likely rely on as they age. When Governor Mitt Romney was considering the individual mandate as part of the Massachusetts reforms, he noted that the personal mandate was about personal responsibility, which is a fundamental Republican value (Starr, 2011). Yet, in a video released by Mother Jones during the campaign, Romney said that 47% of the population feel entitled to government handouts. “I’ll never convince them that they should take personal responsibility and care for their lives,” he said (Mother Jones, 2012). In his acceptance speech after winning another term, President Obama emphasized social responsibility:

What makes America exceptional are the bonds that hold together the most diverse nation on earth. The belief that our destiny is shared; that this country only works when we accept certain obligations to one another and to future generations. The freedom which so many Americans

have fought for and died for come with responsibilities as well as rights. And among those are love and charity and duty and patriotism. That’s what makes America great. Previous sectionNext section

12.6 QUALITY, VARIABILITY, AND MALPRACTICE REFORM

We hear a lot about malpractice reform and frivolous lawsuits and unreasonable awards for pain and suffering. We see local television advertisements by law firms seeking to represent clients “wronged” by providers and insurers. State and federal legislatures and courts debate whether to cap the size of awards or determine when they are excessive. Funding flows freely into campaign coffers from organizations on both sides of the debate; trial lawyers favor the Democratic Party, whereas insurers and organizations representing health providers and facilities favor the Republican Party. Putting political posturing aside, however, several values-related policy issues recur in the debates on this area, including the following:

• The value of a human life lost and of other negative consequences suffered unnecessarily

• The allocation of the responsibility for error between the individual provider and the overall care system

• The amount of variability in outcomes and events that is unavoidable and how much is unacceptable

• The appropriate way to compensate advocates for patient rights and to overcome inappropriate provider behavior

• How much to let the provider community police itself and how much and when to intervene in the public interest. 12.7 PROFESSIONAL ETHICS

Access and rationing are aspects of distributive justice. Confidentiality, truthfulness, informed consent, respect for patient and professional autonomy, and the safety of the patient are all topics cited in discussions of professional ethics and in professional codes of ethics. Most professionals have had some indoctrination in biomedical ethics and are aware of key issues. Most professions have an ethical code or statement. Most such statements have become more general over time as patient autonomy has become more respected and monopolistic practices have come under government scrutiny. At the same time, professional societies may take strong positions without incorporating them into a code. For example, the American Nurses Association has long supported health care as a basic right delivered through a single-payer system.

What About Health Policy Experiments?

Daniels (2006) raised an interesting ethical question for health policy professionals: What if we required that health system transformations had to undergo an ethical review process similar to

that required of medical research experiments? He noted that these social experiments can put significant populations at risk. He did not suggest what the mechanism for such reviews might be; however, he raised the issues of balancing the social value of the experimental policy changes with the risks to which those affected are exposed and how we might go about conducting such a review. He suggested three levels of analysis:

1. Select benchmarks for the ethical analysis in terms of their effect on:

a. Equity b. Efficiency c. Accountability 2. Conduct an ethical evaluation of how well the design of the proposed reform meets its goals:

a. How good is the evidence used to justify the intervention? b. Is the implementation planned adequate to test the results? c. Will the intervention measure the effect with sufficient sensitivity to evaluate the results? d. Are the key implementers involved in the planning and committed to an unbiased evaluation? 3. Determine whether there is sufficient oversight to protect the rights of those involved in the experiment. Informed consent might be impractical in many settings.

He mostly offered examples of international situations, but, overall, he noted, “Unfortunately, there is little experience in measuring how systems establish transparency, accountability, and fair process in decisions involving resource allocation” (p.450).

12.8 CONSUMER SOVEREIGNTY

Those who want a highly competitive marketplace want the consumer to make decisions rather than the government. The examples in the box on the next page illustrate views of health policy analysts on both sides of this economic and political ideological divide. The typical health professional is in a bit of a straddle here. Most believe in patient autonomy but also recognize that consumer sovereignty often comes at the expense of professional power and influence, which some would call paternalism, but may positively affect patient compliance and clinical outcomes as well.

12.9 SOCIAL WELFARE

Interest groups at the table during policy formulation may or may not adequately represent the public’s interests. There are a number of ways of evaluating outcomes in terms of social welfare. Some are economic; some are not. Economic models that would base policy decisions on benefit–cost or cost-effectiveness criteria raise issues of valuation, such as

CONTRASTS IN ECONOMIC AND POLITICAL IDEOLOGY

Cannon and Tanner (2005) agreed in one respect with many who support a greater government role in health: that the health care sector of the economy is special. But they argued that because it is special, reliance on competition is even more critical:

Unlike software, wireless communications, or banking, health care involves very emotional decisions, which often entail matters of human dignity, life, and death. However, we do not see the gravity of these matters as a reason to divert power away from individuals and toward government. Rather we see the special nature of health care as all the more reason to increase each consumer’s sphere of autonomy. (pp. 146–147)

Richmond and Fein (2005) concluded otherwise. They would prefer to use public policy to create a more equitable society:

Health and health care are vitally important in influencing life’s chances and one’s income and wealth should not determine the amount and quality of care one receives. We seek a system in which the financing and distribution of health services reflect our image of a just society, a society in which economic arrangements reflect a moral dimension. (p. 4)

• Willingness to pay

• Contribution to gross domestic product

• Social costs avoided, as in the case of support of a family when the breadwinner dies

At the same time there are other considerations, such as

• Lives saved

• Quality-adjusted life-years (QALYs)

• Longevity

• Pain and suffering avoided

In this arena, there are counterattacks to the economic arguments (Ackerman & Heinzerling, 2004):

Cost–benefit analysis of health and environmental policies trivializes the very values that gave rise to these policies in the first place. Moreover, through opaque and intimidating concepts like willingness to pay, quality-adjusted life-years, and discounting, economic analysts have managed to hide the moral and political questions lying just under the surface of their precise and scientific-looking numbers. It is time to blow their cover. (p. 234)

Discounting is easy to do mathematically but difficult to interpret practically, politically, and ethically. The problem is in the trade-off between the present and the future, a difficult problem in all policy making. The standard economists’ approach of bringing the costs and benefits back to a net present value explicitly biases the analysis against future events. Some advocates, therefore, argue for a discount rate of 0%.

Ackerman and Heinzerling also questioned the use of QALY metrics because they discriminate against the older population, who will naturally have fewer years ahead of them. The same can be said of any analysis dealing with contribution to gross domestic product, because the older population generates little output or will soon stop generating it and the output of children is so far into the future that any reasonable discount rate obliterates the benefits. This is why some suggest that economic analysis is useful for payers and for comparing treatment alternatives for specific illness, but that it really does not work well when comparing an array of different alternative public investments.

12.10 RATIONING

Bodenheimer and Grumbach (2005) suggested a two-part definition of rationing: (1) limiting care that is likely to be beneficial due to scarce resources, including money, and (2) a method of fairly distributing the resources that are available. To this we would add a third condition: (3) that the decision-making method is determined by society rather than a corporation or an individual. Bodenheimer and Grumbach noted that popular use of the term rationing tends to equate it with withholding of care and ignores the second necessary condition. That distinction separates arbitrary actions to decrease the cost of care from situations in which the system attempts to distribute its limited resources in a systematic and equitable way. There are a variety of notions of equity, and thus a rationing system may be designed to

• Reduce overall costs to a targeted level

• Maximize access

• Maximize the social welfare based on the contributions of the individuals within the population

• Maximize medical effectiveness:

• Subject to a cost constraint

• Subject to other resource limitations

• Combinations of the above

For example, the attempt of the British National Health Service (NHS) to limit the costs of care has led to at least one charge of rationing in which a woman with breast cancer was denied the

drug Herceptin by a local health authority on the basis of cost. An account of this has been included in Table 12-2.

Reducing Overall Health Care Costs to a Target Level

An effective rationing system is not aimed at minimizing health care costs. They cannot be driven to zero; however, when there is a budgetary limitation or a fixed-revenue situation, a system must be in place to decide which services will not be provided to which individuals. In many cases, this is done by limiting the population served and limiting the services offered.

For example, one of the largest Medicaid expenses is paying for longterm care for older people, a service not covered by Medicare. States have quietly limited the amount they pay by limiting the number of new nursing home beds they license. They know that there is a strong linear relationship between the number of beds available and the amount of Medicare claims received.

Maximize the Social Welfare

When transplanted organs first became available, it was clear that there were not enough to go around. Institutions doing transplants set up committees of individuals concerned with medical effectiveness and medical ethics to determine who would get the next available organ. This process provides an example of how social welfare considerations can influence rationing and access decisions. The committees examined a mixture of personal, family, and medical data to determine literally who should live and who would, in all probability, die. Considerations included family status, work status, medical factors such as alcoholism and comorbidities, and psychiatric factors. Outside observers were also suspicious that ability to pay might be creeping into the decision making.

Table 12-2 Rationing and the Courts

Ann Marie Rogers, 54, sued the Swindon Primary Care Trust after it refused treatment for her early-stage HER2 breast cancer with the drug Herceptin (trastuzumab), even after her doctor prescribed it. The Roche drug is licensed for late-stage breast cancer, but some studies showed it to be effective for early-stage cancer as well. Ms. Hewitt, the British Health Secretary, had praised the efforts of other women to get the treatment, and the Health Department had ordered the local health services “not to withhold it solely on the grounds of cost,” even while a government-appointed review panel was in the process of setting new guidelines for the use of the drug. Treatment with Herceptin costs $36,000–47,000 a year for each patient and was supplied under very different circumstances by the local health trusts. The Swindon trust had a policy of supplying Herceptin for early-stage breast cancer only in “exceptional circumstances.” Ms. Rogers had pointed to her cancer being of the type responsive to the drug and the risk factors of the death of her mother and a cousin from cancer.

When the trust refused to fund her treatment, Ms. Rogers starting paying for the drug on her own, but had to stop when her own resources were used up. Thus, she sued the authority, citing

the “postal code lottery,” which determined who got treated and who did not. A lower court judge ruled in February 2006 that the Swindon health service’s denial was lawful. In April, however, a three-judge appeals court overturned that verdict and said the local health service had acted unlawfully, noting that “once the Primary Care Health Trust decided, as it did, that it would fund Herceptin for some patients and that the cost was irrelevant, the only reasonable approach was to focus on the patient’s clinical needs and fund patients within the eligible group who were properly prescribed by their physician.” It observed that there had been “no rational basis for distinguishing between patients within the eligible group on the basis of exceptional clinical circumstances any more than on the basis for personal, let alone, social circumstances” (Lyall, 2006). The National Institute for Clinical Excellence (NICE) issued a press release on April 12, 2006, in which NICE Chief Executive Andrew Dillon reaffirmed the importance of ensuring that new drugs are both safe to use, by having an effective system for licensing, and used in the right way through the work that NICE does. “Without these things, we risk exposing patients to risks and the health service to using its money unwisely,” he said (NICE, 2006a). After a public comment period that closed in June 2006, NICE issued guidance in August 2006. “Trastuzumab, given at 3-week intervals for 1 year or until disease recurrence (whichever is the shorter period), is recommended as a treatment option for women with early-stage HER2-positive breast cancer following surgery, chemotherapy (neoadjuvant or adjuvant), and radiotherapy (if applicable)” (NICE, 2006b, p.4). In June 2012, NICE again addressed the breast cancer issue with Technical Appraisal 257, “Breast cancer (metastatic hormone receptor)—lapatinib and trastuzumab (with aromatiase inhibitor).” It stated that NICE did not recommend this as first-line treatment for post-menopausal women who have metastatic breast cancer that is hormone-receptor and HER2 positive. It explained its response as follows: NICE looks at how well treatments work, and also at how well they work in relation to how much they cost the NHS. NICE applies special considerations to treatments that can extend the lives of people who are nearing the end of their life. Lapatinib and trastuzumab (herceptin) do not provide enough benefit to patients to justify their high cost even when the special considerations were applied, so NICE did not recommend them. (NICE, 2012) One problem with the social welfare criterion is that it goes well beyond issues that health professionals are comfortable with. Issues might include citizenship status, economic contribution, utility of one’s work, and emotional impact on others. Reaching some agreement on the importance of each of these is unlikely given current value conflicts in our society. That does not mean that we cannot reach a social consensus, but rather that it would be very difficult to justify once we have reached it.

Maximize Utility and Medical Effectiveness

“The providing or withholding of care is ideally determined by the probability that the treatment will maximize benefits and minimize harm, i.e. by the criterion of medical effectiveness” (Bodenheimer & Grumbach, 2005, p. 137). This concept was operationalized in the Oregon Basic Health Services Act of 1989, which tried to guarantee health care for all and still contr

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