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Ethics, equity and economics

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1 Ethics, equity and economics
Ethics - theories of “justice” - medical versus economic polarisation Equity - definitions - “health”, “need” and “access vs. use” - micro versus macro Economics - equity and efficiency

2 Why ethics? Philosophy determines objectives of health care system e.g. -maximise social well-being based on (consequentialist) utilitarianism Different philosophical concepts have different implications, esp. for “efficiency” Main practical manifestation = equity

3 Categorising ethical theories (1)
Distributive justice - “political” or “social” philosophy - concerned with outcome Procedural justice - “moral” philosophy - concerned with process used in achieving the outcome

4 Categorising ethical theories (2)
Political philosophy - societal focus e.g. Rawls Moral philosophy - individual focus e.g Kantian Imperative Interaction e.g. utilitarianism - social utility maximised by each individual maximising own utility

5 Categorising ethical theories (3)

6 Ethical theories Utilitarianism Rawlsian Entitlement/libertarian
Egalitarian Deontological? Virtue “Rights”

7 Utilitarianism Jeremy Bentham (classic) and John Stuart Mill (adapted)
‘Maximising greatest ‘utility’ for greatest number’ Underlies ‘efficiency’ Issues - domain (whose utility) - malevolence (utility from suffering)

8 Rawlsian ‘maximin’ John Rawls 1971
Allocation conducted under ‘veil of ignorance’ - leads to position of less well off in society being maximised Issues - assumes total risk averseness - ‘bottomless pit’ argument

9 Entitlement/libertarian
Robert Nozick 1974 Individuals ‘entitled’ to what they have acquired ‘justly’ i.e. within a market situation Stresses freedom of choice and property rights - minimal state involvement Similar to utilitarianism

10 Egalitarian Equal shares in the distribution of a commodity
Issues - of what? health, services? - according to what criteria? ‘need’, age?

11 Deontological (deon (Gk) = duty)
Immanuel Kant Moral ‘rules’ of how to live which should not be broken (ie absolute moral code) ‘Do to others as you would have done to you’ Humans as end, not means

12 Virtue theory Not ‘what should I do’ but ‘what kind of person should I be’ Similar to deontological - absolute moral ‘rules’

13 ‘Rights’ based theories
Unassailable ‘rights’ which cannot be overridden e.g.’right’ to life Underlies ‘social contract’ theory Absolute - inflexible

14 ‘Medical’ vs. ‘economic’ ethic (1)
Medical - individual (deontological) ethic - Hippocratic oath, Nightingale Pledge - ‘Agency and professional codes conduct - ‘best interests’ of patient - opportunity cost ignored (?)

15 ‘Medical’ vs. ‘economic’ ethic (2)
Economic - population based ethic - principally ‘utilitarian’ - based on opportunity cost Overlap of considerations in both professions

16 Medical dilemma (1) “I recall a patient who bled massively from his inoperable cancer of the stomach, I was the houseman and I had a strong sense that I must do my utmost for my patient, I ordered large quantities of blood to be cross matched and set up an infusion to replace the blood the patient had lost. It was not that I believed that the blood would cure him, but it would very probably save his life for a while longer, whereas without the blood transfusion he would have probably died there and then. A few days later the patient had another massive bleed and I again ordered more blood and set up a transfusion, again the patient survived what would almost certainly have been a fatal blood loss. The patient himself, knowing the situation, was keen to fight it as hard as possible.”

17 Medical dilemma (2) After the second massive bleed and equally massive blood transfusion, my chief gently pointed out that there was no point in pouring in the blood as I had been, the patient had widespread cancer secondaries, his stomach was riddled with cancer and likely to bleed whenever the cancer eroded a blood vessel; blood transfusions could do no more than prolong the patient’s life by a very short time. If I went on ordering blood at the predigious rate I had been, I would literally break the bank, the blood bank, causing enormous expense whilst seriously jeopardising the chances of other patients for whom a blood transfusion could really be lifesaving, rather than merely death prolonging.

18 Medical dilemma (3) I wanted to discuss all this with the patient, but he died the same day from a further massive bleed and that time I simply was not called. My superior had decided that there was nothing beneficial that could be done. More precisely, however, his analysis was surely based on a different assessment, notably that the benefit to the patient of repeated blood transfusions each time his stomach cancer bled, even if he himself wanted to fight to the last second, was insufficient to justify the enormous cost (to others) of providing the blood.”

19 Tavistock Group - BMJ, Jan 23, 1999
Prepare shared ‘code’ based on consistent moral framework - “healthcare is a human right…provide access…regardless of their ability to pay” - “care of individuals is at centre of health care but must be viewed within context of [generating] greatest possible health gains for groups and populations”

20 Why equity? (1) ‘Health’ = fundamental commodity (Sen) necessary for enjoyment of all else Health care important determinant, but often expensive/unpredictable Insurance = imperfect/expensive Thus...

21 Why equity? (2) Healthcare should not be allocated/distributed according to income/wealth Equity main reason government involvement in health care world-wide Issues - concern with existing distribution income/wealth then why not change this directly? - trade off with efficiency?

22 Why equity in health care?
“ The social conscience is more offended by severe inequality in nutrition and basic shelter, or in access to medical care, than by the inequality in automobiles, books, furniture or boats” Tobin 1970

23 Equity not necessarily = equality
Equity concerned with ‘fairness' ‘justice’ (i.e.ethical theories) May not necessarily entail equality. e.g.minimum standards of care, ‘postitive’ discrimination etc. However, equity usually synonymous with equality of something.

24 Equity: Vertical and/or horizontal?
Vertical - unequals treated unequally - applies especially to finance i.e. inequality in contribution by use (direct payments) or income (taxation) Horizontal - equals treated equally - applies especially to delivery of health care e.g equal resources, utilisation, access per head. - most discussion refers to this.

25 Ethics and equity Mostly ‘horizontal’ equity in distribution of health(care) Based on broad ‘egalitarian’ ethic, but compatible with most others Basis = equal distribution of x (according to y) Issues - what are x and y to be?

26 ‘Definitions’ of equity (1)
Equal ‘chance’ of treatment - lottery Equal expenditure per capita - geography. Equal resources per capita - geography. Equal expenditure/resources for equal ‘need’ (i.e. weighted for ‘premature’ mortality/morbidity e.g. RAWP)

27 ‘Definitions’ of equity (2)
(opportunity to use) Equal access (opportunity to use) for equal need e.g equal waiting time per ‘condition’ Equal utilisation (use) for equal need e.g. equal length of stay per ‘condition’ Equal treatment for equal need Equal ‘health’

28 ‘Access’ or ‘use’? Access - maintain consumer sovereignty
- unlikely to achieve equal ‘health’ Use - closer to achieving equal ‘health’ - compromises consumer sovereignty

29 Equal ‘health’? Definition e.g. QALYS, LY’s?
Influence of non-health care factors e.g. housing, diet Choice versus coercion e.g.smoking, diet Implies reducing overall ‘health’ not ‘increasing’ - only truly equal state = dead Maximising versus minimum standards

30 Equity and ‘need’ (1) ‘Need’ = ambiguous and confusing
Who determines need - producer - individual - ‘elite’ Supply driven - what is available determines what is needed Need versus ‘capacity to benefit’ - treat worse off even if health improvement less than treating better off

31 Equity and ‘need’ (2) ‘need’ versus ‘preference’
‘objective’ versus ‘subjective’ need maximising - quantity of resources required to ensure individual becomes /maintained as healthy as possible = ‘bottomless pit’ Minimising - standard of care which ensures individual not fall below ‘adequate’ level of health

32 Equity and the NHS (1) “To provide the people of Great Britain, no matter where they may be, with the same level of service” (Bevan 1948)

33 Equity and the NHS (2) “A fundamental purpose of a national service must be equality of provision so far as this can be achieved without an unacceptable sacrifice of standards”. (Merrson 1979) Report of the Royal Commission of the NHS

34 Equity in practice Historically concerned with geographical distribution of resources e.g. RAWP In financing usually concerned with finance by taxation - represents ‘positive discrimination’ by income

35 Measuring equity Finance - Kakwai Index
- Suits Index Health - Gini coeff - see McGuire p.59 Data - see Folland, Goodman & Stano book p.487 - see Donaldson & Gerard

36 ‘Micro’ versus ‘macro’ equity
Micro - distribution between individuals e.g. GP. Individual ethic Macro - distribution between groups e.g. regions. Group ethic Useful to separate - not necessary for one ethic to apply across all levels

37 Economics, equity and ethics
Common root = limited resources Efficiency based on utilitarian ethic Equity maybe based on a range of ethics Does this lead to an inevitable conflict?

38 Social welfare function
UB 2 W 1 W U W Umin 45 U UA Umin

39 Utilitarianism encompasses all! (1)
Altruism = ‘caring externality’ - Sen (1977) concept of ‘sympathy’ - own utility enhanced by anothers well-being - fits within utilitarian philosophy Altruism = ‘duty’ (Kantian imperative) - Titmuss (1970) - ‘duty’ give for benefit of others - constraint on utility maximisation (c.f. resource constraint)

40 Utilitarianism encompasses all (2)
Participation altruism - utility gained from participation in social/collective acts regardless of utility from consumption which results Outcome altruism - utility gained from utility derived by others in consuming what is ‘charitably’ provided

41 Utilitarianism encompasses all! (3)
Generates possibility of 2, interdependent, utility functions for individual - as citizen and consumer Diminishing marginal utility, and possibility of ‘free riding’, creates ‘rationale’ for coercion in achieving ‘citizen’ objectives

42 Coming to a consensus? Efficiency & equity common root - scarcity
No universal agreed ethic for objectives of health care sector But - ‘equality of access’ consistent with most ethical theories and consistent with efficiency (preserves consumer sovereignty)

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