Professor Alan Maynard OBE looks at the changes needed to make NICE’s rationing role more effective in an economically-challenged environment
The current economic and financial crisis will affect public expenditure for the next decade. Even if the Conservatives and the Labour parties seek to meet their pledges to maintain public funding of education and the NHS, it is doubtful whether they can maintain their promises, let alone increase the funding of these services as demand increases.
One reason for this pessimism is that supporting NHS and education funding can only be done at the cost of other public services.
Which of these should suffer if health care and education are to prosper, relatively. Can the road, rail, defence, police, justice and other budgets be cut and for how long without affecting the already weak transport and environmental infrastructure and law and order?
Pay cuts are coming
Inevitably, then, a focus will fall on public sector pay cuts. Hopefully at levels well below the 20% cuts imposed recently in Latvia! However even if labour costs are reduced, greater scrutiny of existing QUANGOs is both necessary and inevitable. Let’s start with NICE!
’ Inevitably, then, a focus will fall on public sector pay cuts’
NICE is acquiring international cult status - as exemplified by the Americans’ increasing enthusiasm for emulation of this rationing device.
The legislation that created NICE was robustly conceived as a means of creating strict codification about what it could and could not do, thereby protecting government from the slings and arrows of outrageous debate to some extent ...
Costs and benefits were to be narrowly defined as the value of what the NHS gave up when funding care and what the patient gained from care, the quality adjusted life year (QALY).
What NICE does not
NICE does not consider non-NHS costs and benefits to carers. This is a product of the difficulty of measuring and valuing such effects. But their exclusion inevitably gives the drug industry and patient lobbies room for complaint about the incompleteness of NICE’s work.
The agenda of NICE is narrow, a product of Departmental conservatism and NICE’s caution. Most NHS rationing is done not by NICE but by PCTs. NICE focuses on a limited number of largely new pharmaceutical technologies, making it a “PR agency” for the industry.
If NICE blesses a product with its approval, the company gets market access in the UK and also eases access to many markets overseas where decision makers are NICE-watchers.
’NICE should reject more applications for marginally cost-effective drugs and require companies to do more trials to identify more thoroughly the attributes, both negative and positive, of new products’
Given the economic crisis and the pressures on NHS funding, we need NICE to be a much more aggressive rationing agency. First off, NICE should reject more applications for marginally cost-effective drugs and require companies to do more trials to identify more thoroughly the attributes, both negative and positive, of new products.
The next necessary step is that NICE should be given a budget. As the volume of NICE activity increases, following Darzi-induced increased funding, its capacity to inflate local NHS demand with “mandatory guidance” will rise also. This will crowd out many other service developments which have not been “NICEd” - but which may be superior in terms of cost-effectiveness to the products mandated by NICE.
Giving NICE a budget would make it recognise that each of its decisions excludes other services in the NHS from funding Currently, NICE can ignore this issue as legislation merely asks them to guestimate the cost of their advice. If they also had to fund PCTs for implementation of their advice creative conflict between these two rationers, NICE and PCTs, would be engendered.
This is necessary to ensure that the “cut offs” of these two rationers are consistent. NICE’s cut off is circa £30,000 per QALY but work from York researchers indicates that the cut-offs used for competing therapeutic areas in PCTs is generally lower, and often less than £20,000 per QALY.
The relatively generous rationing approach of NICE is driving out more cost-effective interventions that PCTs would like to provide. Thus NICE is creating inefficiency in the use of society’s scarce resources.
Since its creation in 1999, it has been suggested by commentators and supportive critics such as the House of Commons Select Committee on Health that NICE ought to have a greater focus on eliminating treatments of slight cost-effectiveness from the NHS.
Apart from analysis of such issues as the inappropriate and excessive use of antibiotics and hysterectomy surgery, NICE has been dormant.
The sleep of economic reason is ending
With the economic crisis now upon us, such sleepiness is no longer tolerable. But is the equally sleepy Department of Health willing to engage in shifting NICE effort and budget into eliminating procedures of little benefit to patients? Hope springs eternal as we wait for Andy Burnham to get his act together!
It is time to pause and reflect about how NICE’s activities can be improved to the benefit of patients and taxpayers.
Quite rightly, NICE is seen as a success but enthusiasm for this rationing device has to be conditional on improving its structure and performance, even if this requires changing its founding legislation.