1. Health Economics: Principles, Programme and Training Rebecca Worboys – Health Economist PHE

2. Content  Introduction to the new health economics programme in PHE  Structure  Function  Objectives  Current and upcoming work  Training  Internal training  External training for LAs  Introduction to health economics  Health economics principles and role in public health  Example: Tobacco 2Health Economics: Principles, Programme and Trainingrebecca.worboys@phe.gov.uk

3. Health Economics in PHE – The (Small!) Team Sits within CKO but is a cross-divisional programme 3 Chief Economist Brian Ferguson Programme Manager Rubina Varma Health Economist Rebecca Worboys Programme Manager (3 d/w) Colin Flynn Consultant working on SPOT (2 d/w) Rory O’Connor Health Economics Programme Lead Sue Baughan Health Economics: Principles, Programme and Trainingrebecca.worboys@phe.gov.uk

4. Functions Focus: To make the case for investing in prevention and early intervention  HE work will help highlight possible incentives and trade-offs involved in making the case for investing in prevention  Health Economics Internal Governance Group: Comprises individuals with health economics skills and expertise. We meet regularly to ensure that the scarce resources devoted to this work are deployed as effectively as possible.  In-house capacity is very limited so we have a commissioning budget which has been agreed to use external academic expertise and support from the commercial sector. 4Health Economics: Principles, Programme and Trainingrebecca.worboys@phe.gov.uk

5. Objectives 1.Building Capacity  Internal training within PHE  Internal capacity building training  External training programme for LAs 2.Making the case for investing in prevention  Optimity Matrix Commission  Identifying cost-effective interventions in priority areas 3.Developing tools and resources  SPOT  New Opportunity Profiles 5Health Economics: Principles, Programme and Trainingrebecca.worboys@phe.gov.uk

6. Current Work – SPOT Tool Spend and Outcome Tool (SPOT) for Local Government The Spend and Outcome Tool (SPOT) gives local authorities in England an overview of spend and outcomes across key areas of business inc PH The tool helps local areas to understand the overall relationship between spend and outcomes, by identifying areas of significant variance which are likely to require more in-depth analysis A number of different benchmarking groups are used to provide a range of peer comparisons Spend data has been gathered from the Department of Communities and Local Government (DCLG) for top-tier local authorities 6Health Economics: Principles, Programme and Trainingrebecca.worboys@phe.gov.uk

7. SPOT Tool For your convenience, SPOT will also output a list of all measures – both spend and outcomes – where it considers the chosen organisation as an outlier, or where there is insufficient data to make that judgement All outputs can be customised and are exportable as PDFs Full access to raw and processed data for end-user analysis Any feedback would be greatly appreciated; it is an iterative process and understand there are improvements that can be made. 7 Watch 10 min video for an overview of SPOT http://www.yhpho.org.uk/resource/view.aspx?RID=203988 Health Economics: Principles, Programme and Trainingrebecca.worboys@phe.gov.uk

8. SPOT Programme Quadrant Chart Shows how all programme budgets in your chosen organisation perform against the respective national averages, using modified z-scores plotted on axes. Spend plotted on the horizontal, outcome on the vertical. Can be viewed with weighted analysis (multiple outcome measures) or unweighted (single relevant outcome measures). http://www.yhpho.org.uk/resource/view.aspx?RID=49488 8 Health Economics: Principles, Programme and Trainingrebecca.worboys@phe.gov.uk

9. Current Work – Optimity Matrix Commission Health economics metrics to support the case for prevention Commissioned by PHE to undertake a review of tools and evidence summaries to help LAs and the NHS  make the case for investment in prevention or early intervention  priorities investment (and disinvestment)  improve the use of existing resources invested Focuses on the 5 priorities. The report will provide a systematic list of tools available to calculate the return on investment in public health interventions. Workshop on Wednesday 3 rd June to  ascertain requirements in terms of CE tools  identify gaps in the availability of suitable tools  explore hypothetical examples 9 June Deadline Health Economics: Principles, Programme and Trainingrebecca.worboys@phe.gov.uk

10. Upcoming work – New Opportunity Profiles They will support health and social care organisations to make the case for investing in prevention To identify the opportunity for prevention leading to health improvement and resource use avoided at a local level from… The pilot will focus on the prevention opportunities to impact on the funding and health gap identified in the 5YFV. Focusing on CVD to start with. Early days! 10Presentation title - edit in Header and Footer reducing observed unwarranted variation

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12. Internal Training – Bitesize Health Economics 12 Who should attend? Anyone in PHE who would like a basic understanding of the world of heath economics and to understand the approach health economists take to reaching their conclusions. Objectives To identify key principles of health economics To demonstrate the important of health economics in decision making To explore health economics in public health, specifically prevention When? 1-2 hour sessions in each centre/region this year – limited capacity 30 Health Economics: Principles, Programme and Trainingrebecca.worboys@phe.gov.uk

13. External Training for Local Authorities Who should attend? Anyone with an interest in using health economic metrics and principles to make the case for investing in prevention or to priorities investment/disinvestment. Objectives To provide an overview of the key health economic principles and evaluation methods To explore in the context of the health and social care resource allocation decision making framework To provide practical examples of how readily available information sources and tools can be used to make the case for investing in prevention and for prioritising investment and disinvestment for population health When? 1 day training sessions in Q3 & Q4 of 2015/16 13Health Economics: Principles, Programme and Trainingrebecca.worboys@phe.gov.uk

14. Economics The science of scarcity… there is not enough to go round Unfortunately this is also the case for the world of healthcare 14Health Economics: Principles, Programme and Trainingrebecca.worboys@phe.gov.uk Limited Resources Unlimited Wants The Problem of Scarcity A branch of economics concerned with issues related to scarcity in the allocation of health and health care

15. Role of health economists 15Health Economics: Principles, Programme and Trainingrebecca.worboys@phe.gov.uk. To support healthcare professionals deliver value for money services To rationalise and improve decision making

16. Value for Money More than just the price tag… What is the true cost to society? 16Health Economics: Principles, Programme and Trainingrebecca.worboys@phe.gov.uk Long-term benefits of the product The external benefits/costs to society from the product What is the cost- effectiveness? What is the efficiency of the product? ‘Return on Investment’ ‘Cashable savings’ ‘CBA’

17. Opportunity Cost ‘Remember, you can only spend it once’ 17 ‘The true cost of using scarce healthcare funding to provide a service is their unavailability to fund an alternative healthcare service which would also be beneficial’ (Jackson, 2012) A New Car A Holiday Health Economics: Principles, Programme and Trainingrebecca.worboys@phe.gov.uk

18. Health Economics Healthcare decision-makers have to make difficult choices; health economists think about how to inform these choices and prioritise some health interventions over other ones through the comparison of their total costs and their true benefits 18 Health Economics: Principles, Programme and Trainingrebecca.worboys@phe.gov.uk

19. Tobacco -Primary cause of preventable morbidity and premature death -Smoking is single biggest cause of inequalities in death rates between the richest and poorest in our communities -Tackling tobacco use is central to PHEs objective to improve the health of the poorest, fastest. -In 2006/07 cost to NHS from treating smoking related illness was £2.7bn -Overall economic burden of tobacco use to society is estimated to be £13.74 billion a year – productivity, fires, smoking breaks 19 £2.7 billion – £350m per week Cost to NHS from Smoking £13.74 billion = Cost to Society from Smoking Health Economics: Principles, Programme and Trainingrebecca.worboys@phe.gov.uk

20. Tobacco Employment NHS costs Productivity losses Losses from smoking breaks Costs of house fires Sociable? Stress-relief? A 20-a-day smoker of a premium band = £2,900 per year Private Costs Private Benefits Social Benefits Social Costs 20 Health Economics: Principles, Programme and Trainingrebecca.worboys@phe.gov.uk

21. NICE ROI Tool for Tobacco Example of an economic tool – many around. The NICE tool evaluates a portfolio of tobacco control interventions and models the economic returns that can be expected in different payback timescales. Interventions can be mixed and matches to see which package of interventions provides the best ‘value for money’. 21 Supports commissioners and policy makers, in LAs and the NHS, in their investment decisions There is a Special Point of Contact (SPOC) available in each KIT to support use of tools Health Economics: Principles, Programme and Trainingrebecca.worboys@phe.gov.uk

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24. Thank you for listening Rebecca Worboys: rebecca.worboys@phe.gov.uk For general enquiries: healtheconomics@phe.gov.uk 24 Health Economics: Principles, Programme and Trainingrebecca.worboys@phe.gov.uk