Starter Activity: Health Economics

This is a follow-up blog to Ben Cahill’s superb idea for a first lesson in economics focusing on making tough choices about resource use with a kidney dialysis machine. See: An activity for the first Economics lesson of the year!

I too will be using health care economics as a starter activity with my AS micro groups this year. I was interested in finding out some of the assumed costs of different health care treatments offered by the NHS and my research took me to published cost/price lists used by NHS Scotland. Drawing on a detailed spreadsheet I selected the following:

Scottish NHS Treatment (2011 Cost in £s)

Bone Marrow Transplant £50,817
Skin Grafts for Major Burns Injury £36,567
Kidney Transplant from Cadaver Heart beating donor 18 years and under £32,699
Complex Tuberculosis £30,169
Major Hip Procedures £19,929
Live Donation of Kidney £12,446
Major Burn, third degree or more than 19% TBSA or Affecting Multiple Body Regions without Significant Skin Graft £11,965
Traumatic Amputations with Major CC £4,466
Heart Failure or Shock with CC £4,411
Healthy Baby £1,307
Tonsillectomy 19 years and over without CC £1,193
Asthma or Wheezing £1,035
Sprains, Strains, or Minor Open Wounds without CC £906
Headaches and Migraines without CC £767

CC: Critical care provided

I will use this data to ask students why there is such a wide range of assumed costs for a specific case and in doing so draw out the specific factors of production used in providing NHS treatments and also the opportunity costs of providing expensive health care when the budget is constrained.

The data is taken from published figures for the Scottish NHS. I might develop the discussion to ask students whether the costs might be different in other parts of the United Kingdom and we will briefly look in an introductory way at concepts of equity and efficiency in offering health care in different parts of the UK. Study of the production possibility frontier flows easily from this initial case study.

For independent research I will ask students to

1/ Research the role of NICE (The National Institute for Clinical Excellence) and discuss some of their recent decisions on which drugs / treatments to make available via the NHS - for example - Appeal to keep NHS leukaemia drug (July 2011)

2/ Find out some of the prices / tariffs for different types of private health care in the UK and explore reasons behind different prices in the private sector

3/ Explore the concept of health insurance. 25 million people had travel insurance in 2009, 24 million had motor insurance and 14 million had home and contents insurance. Only 3.3 million people paid into private medical insurance schemes in 2009 and 0.43 million had critical illness insurance. Why?

Vimeo has this lively debate on NHS rationing and the price of life in which the first speaker is the Head of NICE who outlines their role and the challenges they face

Rationing and medicine: what price life? from worldwrite on Vimeo.

I am trialling Piazza as a way of getting students to contribute ideas and work both individually and collaboratively. More on this experiment a little later in the term!