5 March 2021

The importance of thinking ‘inside’ the box when making a decision

Heather Humphreys, The Health Economics Unit’s Lead Analyst and Health Economist, explains why decision makers in health care need to be clear about exactly what they’re deciding on, and what they’re taking into account, before drawing conclusions.

Sometimes in life, questions can feel so wide in their scope that it seems impossible to come up with an answer that covers everything you need to take into account and all possible eventualities. For example, do you buy a more expensive but reliable new car or a second-hand motor that’s cheaper but you can’t be sure of its condition?

My advice? When you’re making a decision, think first about which variables you want to consider and which are the most important, then focus on those alone. The colour of the car doesn’t matter, or the letters in the registration, but the mileage might.

I call this ‘creating a box’ – you put everything you want to consider when making your decision in the box and leave out what you don’t. At HEU, it’s an exercise that helps us work with clients to define the scope of a project and its measurables, whether we’re creating a cost effectiveness model, a budget impact model, an evaluation or an algorithm. In fact, any project we work on really needs a box.

Deciding what goes in the box

The job of an economist is to define a problem and what you’re going to measure to choose your solution.

When teaching students, I use the example of an island shaped like a C, with people living at the top and work based at the bottom. A decision must be made on whether to build a bridge linking the two places. What the students need to consider are the costs and benefits for islanders, and the different boxes they could create – for example money, travel time, the environment and so on. They also need to look at the implications of the bridge not being built and the opportunity cost of that. Perhaps also compare the costs of doing something to doing nothing.

Economists can help health care leaders to define cost, quality and value within health care. Health outcomes are a bit like currency, but they can be looked at in different ways depending on the intervention you choose.

Choosing measures of success

Say a primary care network (PCN) is looking at the issue of childhood obesity and deciding whether to continue delivering a cooking class for families. How do they put a value on whether or not it’s been successful over the last year? Do they look at changing rates of obesity reported through school nurses or the number of children diagnosed with diabetes? Or do they look at attendance figures and ongoing feedback from parents on any behaviour changes?

It’s important, before an evaluation or project begins, to discuss what you are going to be studying, to make sure the important variables are covered. Remember that there will always be more than one stakeholder, so you also need to consider other people’s expectations of what will be included. Health doesn’t act in isolation; it’s closely linked with social care and other players.

Health economists can help you think about how a particular project can help solve a specific problem and what actions are most likely to receive support and therefore funding. We can help you compare different outcomes in a systematic way to support resource allocation based on any number of important factors – by putting them into the right type of box.

We can also ensure you only take the analytics as far as they need to, for example if a client asks us for a complex cost effectiveness analysis when what they actually need is a much simpler budget impact model, we’ll say so and explain why.

Supporting decision making at all levels

Health economists play an important role in helping health care leaders decide on how to spend their limited resources, by keeping those decisions manageable and targeted. With so many pressures and choices to be made at all levels, from individual GP practices to PCNs, STPs, ICSs and even the NHS as a whole, good decision making must be supported by the best and most relevant evidence.

To find out more about health economics and the Health Economics Unit, contact Heather Humphreys

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