nrac resource allocation formula: purpose and methods acute mlc sub-group: 4 th february 2014
TRANSCRIPT
![Page 1: NRAC Resource Allocation Formula: Purpose and Methods Acute MLC sub-group: 4 th February 2014](https://reader030.vdocuments.mx/reader030/viewer/2022032801/56649dda5503460f94ad067d/html5/thumbnails/1.jpg)
NRAC Resource Allocation Formula: Purpose and Methods
Acute MLC sub-group: 4th February 2014
![Page 2: NRAC Resource Allocation Formula: Purpose and Methods Acute MLC sub-group: 4 th February 2014](https://reader030.vdocuments.mx/reader030/viewer/2022032801/56649dda5503460f94ad067d/html5/thumbnails/2.jpg)
Outline:
• Role of the formula• Basic overview of the issues• Structure, data and methods• Formula outputs
![Page 3: NRAC Resource Allocation Formula: Purpose and Methods Acute MLC sub-group: 4 th February 2014](https://reader030.vdocuments.mx/reader030/viewer/2022032801/56649dda5503460f94ad067d/html5/thumbnails/3.jpg)
Purpose: to inform the distribution of around 70% of the health budget to 14 territorial boards ...
• Through the calculation of target shares• Using estimates of predicted need• On an objective basis• To ensure equitable access to healthcare• Taking account of relative morbidity• And the relative (unit) costs of service
![Page 4: NRAC Resource Allocation Formula: Purpose and Methods Acute MLC sub-group: 4 th February 2014](https://reader030.vdocuments.mx/reader030/viewer/2022032801/56649dda5503460f94ad067d/html5/thumbnails/4.jpg)
Basic overview: relative need
Health board A
Health board B
![Page 5: NRAC Resource Allocation Formula: Purpose and Methods Acute MLC sub-group: 4 th February 2014](https://reader030.vdocuments.mx/reader030/viewer/2022032801/56649dda5503460f94ad067d/html5/thumbnails/5.jpg)
Basic overview: relative need
Health board A
Health board B
![Page 6: NRAC Resource Allocation Formula: Purpose and Methods Acute MLC sub-group: 4 th February 2014](https://reader030.vdocuments.mx/reader030/viewer/2022032801/56649dda5503460f94ad067d/html5/thumbnails/6.jpg)
Basic overview: relative need
• Cost of fracture = £1,000
• Cost of maternity services = £2,000
![Page 7: NRAC Resource Allocation Formula: Purpose and Methods Acute MLC sub-group: 4 th February 2014](https://reader030.vdocuments.mx/reader030/viewer/2022032801/56649dda5503460f94ad067d/html5/thumbnails/7.jpg)
Basic overview: relative need
Health board A: Cost = £4,000
Health board B: Cost = £5,000
![Page 8: NRAC Resource Allocation Formula: Purpose and Methods Acute MLC sub-group: 4 th February 2014](https://reader030.vdocuments.mx/reader030/viewer/2022032801/56649dda5503460f94ad067d/html5/thumbnails/8.jpg)
Basic overview: relative need
Health board A: £4,000Health board B: £5,000
Total £9,000
Target share: 44% Target share: 56%
![Page 9: NRAC Resource Allocation Formula: Purpose and Methods Acute MLC sub-group: 4 th February 2014](https://reader030.vdocuments.mx/reader030/viewer/2022032801/56649dda5503460f94ad067d/html5/thumbnails/9.jpg)
Basic overview: predicted needBudget allocated ex ante
But how many will require health care services …
?? ??
![Page 10: NRAC Resource Allocation Formula: Purpose and Methods Acute MLC sub-group: 4 th February 2014](https://reader030.vdocuments.mx/reader030/viewer/2022032801/56649dda5503460f94ad067d/html5/thumbnails/10.jpg)
Basic overview: predicted need
• Formula attributes health service use in the recent data to age, sex and socio-economic conditions – national average relationships
• Need predicted by applying these national average relationships to local population characteristics and local socio-economic conditions
![Page 11: NRAC Resource Allocation Formula: Purpose and Methods Acute MLC sub-group: 4 th February 2014](https://reader030.vdocuments.mx/reader030/viewer/2022032801/56649dda5503460f94ad067d/html5/thumbnails/11.jpg)
Structure:• Uses a weighted capitation approach• Fundamental starting point is (resident) population share• Weighted to reflect need for, and cost of, health services• Relative need: age and sex; Morbidity and Life
Circumstances; • Relative cost: Unavoidable Excess Costs• Product of components generates target shares
PopulationShare
%
ExcessCostIndex
XTarget Share
%=
Age & sex index
XMorbidity & Life Cs
indexX
Need
![Page 12: NRAC Resource Allocation Formula: Purpose and Methods Acute MLC sub-group: 4 th February 2014](https://reader030.vdocuments.mx/reader030/viewer/2022032801/56649dda5503460f94ad067d/html5/thumbnails/12.jpg)
Data:• Built up using small area information• Basic geographical unit is the data zone (or IG)
![Page 13: NRAC Resource Allocation Formula: Purpose and Methods Acute MLC sub-group: 4 th February 2014](https://reader030.vdocuments.mx/reader030/viewer/2022032801/56649dda5503460f94ad067d/html5/thumbnails/13.jpg)
Health Boards:
![Page 14: NRAC Resource Allocation Formula: Purpose and Methods Acute MLC sub-group: 4 th February 2014](https://reader030.vdocuments.mx/reader030/viewer/2022032801/56649dda5503460f94ad067d/html5/thumbnails/14.jpg)
![Page 15: NRAC Resource Allocation Formula: Purpose and Methods Acute MLC sub-group: 4 th February 2014](https://reader030.vdocuments.mx/reader030/viewer/2022032801/56649dda5503460f94ad067d/html5/thumbnails/15.jpg)
![Page 16: NRAC Resource Allocation Formula: Purpose and Methods Acute MLC sub-group: 4 th February 2014](https://reader030.vdocuments.mx/reader030/viewer/2022032801/56649dda5503460f94ad067d/html5/thumbnails/16.jpg)
Data:• Resident population characteristics and socio-economic
environment• NRS population projections – rebased• Need is modelled using healthcare utilisation (volume
and cost)• SMR activity and Costs Book costs by speciality
![Page 17: NRAC Resource Allocation Formula: Purpose and Methods Acute MLC sub-group: 4 th February 2014](https://reader030.vdocuments.mx/reader030/viewer/2022032801/56649dda5503460f94ad067d/html5/thumbnails/17.jpg)
Method:• Costing methodology• Episodes not spells• By care programme and diagnostic group
![Page 18: NRAC Resource Allocation Formula: Purpose and Methods Acute MLC sub-group: 4 th February 2014](https://reader030.vdocuments.mx/reader030/viewer/2022032801/56649dda5503460f94ad067d/html5/thumbnails/18.jpg)
Method: age and sex effect
• estimated national average cost by age for males and females
![Page 19: NRAC Resource Allocation Formula: Purpose and Methods Acute MLC sub-group: 4 th February 2014](https://reader030.vdocuments.mx/reader030/viewer/2022032801/56649dda5503460f94ad067d/html5/thumbnails/19.jpg)
Method: Morbidity and Life Circumstances
• Morbidity and Life Circumstances effect captures the variation in utilisation relative to the age and sex effect
• Measured by the cost ratio for the data zone• (Actual cost)/(Expected cost)• Scotland average = 1• Variation above or below Scotland average related to
socio-economic indicators of need; • Analysis undertaken by diagnostic group
![Page 20: NRAC Resource Allocation Formula: Purpose and Methods Acute MLC sub-group: 4 th February 2014](https://reader030.vdocuments.mx/reader030/viewer/2022032801/56649dda5503460f94ad067d/html5/thumbnails/20.jpg)
x xx x x
x x x x x x x xx x x x
x x x x x
x
Method: estimating the MLC effect
Change in need
Change in utilisation
Age & Sex Adjusted Utilisation
Socio-economic conditions
1
![Page 21: NRAC Resource Allocation Formula: Purpose and Methods Acute MLC sub-group: 4 th February 2014](https://reader030.vdocuments.mx/reader030/viewer/2022032801/56649dda5503460f94ad067d/html5/thumbnails/21.jpg)
x
x xx x xx
x xxx
x xx
x x x
Method: estimating the MLC effect
Utilisation
Socio-economic conditions
![Page 22: NRAC Resource Allocation Formula: Purpose and Methods Acute MLC sub-group: 4 th February 2014](https://reader030.vdocuments.mx/reader030/viewer/2022032801/56649dda5503460f94ad067d/html5/thumbnails/22.jpg)
x xx x x
x x x x x x x xx x x x x x x
x x x x xx
Method: estimating the MLC effect
Utilisation
Socio-economic conditions
![Page 23: NRAC Resource Allocation Formula: Purpose and Methods Acute MLC sub-group: 4 th February 2014](https://reader030.vdocuments.mx/reader030/viewer/2022032801/56649dda5503460f94ad067d/html5/thumbnails/23.jpg)
x xx x x
x x x x x x x xx x x x x x x
x x x x xx
Method: estimating the MLC effect
Utilisation
Socio-economic conditions
![Page 24: NRAC Resource Allocation Formula: Purpose and Methods Acute MLC sub-group: 4 th February 2014](https://reader030.vdocuments.mx/reader030/viewer/2022032801/56649dda5503460f94ad067d/html5/thumbnails/24.jpg)
Method: variation in (unit) cost …
‘Unavoidable Excess Cost Adjustment’ • Ratio of local unit costs relative to national unit costs• DZ ratio averaged of across urban-rural geographies• Objective geographical classification - control for
variation in efficiency
![Page 25: NRAC Resource Allocation Formula: Purpose and Methods Acute MLC sub-group: 4 th February 2014](https://reader030.vdocuments.mx/reader030/viewer/2022032801/56649dda5503460f94ad067d/html5/thumbnails/25.jpg)
Outputs: Published Target Shares
Health Board Population
Share1 Age-sex
share Age-sex and MLC share
Overall share
Ayrshire & Arran 6.91% 7.29% 7.36% 7.36%Borders 2.15% 2.32% 2.07% 2.10%Fife 6.99% 7.13% 6.94% 6.90%Greater Glasgow & Clyde 22.91% 22.10% 24.35% 24.01%Highland 5.93% 6.35% 5.94% 6.36%Lanarkshire 10.64% 10.46% 10.98% 10.88%Grampian 10.66% 10.55% 9.67% 9.68%Orkney 0.38% 0.41% 0.37% 0.43%Lothian 16.34% 15.58% 15.03% 14.86%Tayside 7.74% 8.11% 7.86% 7.84%Forth Valley 5.64% 5.59% 5.54% 5.51%Western Isles 0.49% 0.55% 0.53% 0.62%Dumfries & Galloway 2.79% 3.14% 2.95% 3.00%Shetland 0.43% 0.43% 0.39% 0.46%
![Page 26: NRAC Resource Allocation Formula: Purpose and Methods Acute MLC sub-group: 4 th February 2014](https://reader030.vdocuments.mx/reader030/viewer/2022032801/56649dda5503460f94ad067d/html5/thumbnails/26.jpg)
Outputs: magnitude of variation in weights …
Age & sex index
Morbidity & Life Cs
index
ExcessCostindex
Overallindex
0.52 0.71 0.97 0.412.07 1.85 1.38 2.18Data Zone
Health Board0.96 0.90 0.98 0.911.12 1.10 1.20 1.29
![Page 27: NRAC Resource Allocation Formula: Purpose and Methods Acute MLC sub-group: 4 th February 2014](https://reader030.vdocuments.mx/reader030/viewer/2022032801/56649dda5503460f94ad067d/html5/thumbnails/27.jpg)
NRAC Resource Allocation Formula: Purpose and Methods
Acute MLC sub-group: 4th February 2014