Is Economic Evaluation and Care Commissioning Focused on Achieving the Same Outcomes? Resource-Allocation Considerations and Challenges Using England as a Case Study

Matthew Franklin (), Sebastian Hinde, Rachael Maree Hunter, Gerry Richardson and William Whittaker
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Matthew Franklin: The University of Sheffield
Sebastian Hinde: University of York
Rachael Maree Hunter: University College London
Gerry Richardson: University of York
William Whittaker: Institute for Health Policy and Organisation

Applied Health Economics and Health Policy, 2024, vol. 22, issue 4, No 2, 435-445

Abstract: Abstract Commissioning describes the process of contracting appropriate care services to address pre-identified needs through pre-agreed payment structures. Outcomes-based commissioning (i.e., paying services for pre-agreed outcomes) shares a common goal with economic evaluation: achieving value for money for relevant outcomes (e.g., health) achieved from a finite budget. We describe considerations and challenges as to the practical role of relevant outcomes for evaluation and commissioning, seeking to bridge a gap between economic evaluation evidence and care commissioning. We describe conceptual (e.g., what are ‘relevant’ outcomes) alongside practical considerations (e.g., quantifying and using relevant endpoint or surrogate outcomes) and pertinent issues when linking outcomes to commissioning-based payment mechanisms, using England as a case study. Economic evaluation often focuses on a single endpoint health-focused maximand, e.g., quality-adjusted life-years (QALYs), whereas commissioning often focuses on activity-based surrogate outcomes (e.g., health monitoring), as easier-to-measure key performance indicators that are more acceptable (e.g., by clinicians) and amenable to being linked with payment structures. However, payments linked to endpoint and/or surrogate outcomes can lead to market inefficiencies; for example, when surrogates do not have the intended causal effect on endpoint outcomes or when service activity focuses on only people who can achieve prespecified payment-linked outcomes. Accounting for and explaining direct links from commissioners’ payment structures to surrogate and then endpoint economic outcomes is a vital step to bridging a gap between economic evaluation approaches and commissioning. Decision-analytic models could aid this but they must be designed to account for relevant surrogate and endpoint outcomes, the payments assigned to such outcomes, and their interaction with the system commissioners purport to influence.

Date: 2024
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DOI: 10.1007/s40258-024-00875-3

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