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This week’s paper of the week is brought to you by Dr Tim Wilson, Managing Director

Full reference and title from the journal:
Atella, V., Belotti, F., Bojke, C., Castelli, A., Grašič, K., Kopinska, J., … Street, A. (2019). How health policy shapes healthcare sector productivity? Evidence from Italy and UK. Health Policy, 123(1), 27–36.


Authors conclusion

Productivity growth is measured as the rate of change in outputs over the rate of change in inputs. We find that the overall NHS productivity growth index increased by 10% over the whole period, at an average of 1.39% per year, while SSN productivity increased overall by 5%, at an average of 0.73% per year. Our results suggest that different policy objectives are reflected in differential growth rates for the two countries. In England, the NHS focused on increasing activity, reducing waiting times and improving quality. Italy focused more on cost containment and rationalized provision, in the hope that this would reduce unjustified and inappropriate provision of services.


3V bottom line 

Narrow definitions of productivity mean that health systems neither spot nor address the big issues of variation and outcomes that matter


3VH – Implications for value 

In this week’s paper it is notable for what the authors miss rather than what they address. In trying to look at productivity in two universal health systems- the UK and Italy they get the denominator and numerator wrong.

First, their description of productivity is specific- outputs versus inputs. Porter adapted this for his definition of value to outcomes versus costs. But the EU position paper on Value Based Healthcare has said this is too narrow. Instead we need to be thinking about whole population groups with a need, not just those being treated.

The importance of this is that whilst productivity for the patients being treated for a particular condition – chiefly those going through hospitals- has improved over the seven year study period by 10% in England and 5% in Italy, we do not know about the impact this has had on the population with the condition as a whole. Not just are we treating people more efficiently, but are we treating the right people? The scale of variation of treatment rates is, for common conditions like hip replacements, 400%. This makes the 10% productivity gain in England look irrelevant.

Second, there is no indication whether the care is being delivered equitably. Providing efficient care inequitably is clearly missing one of the core aims of universal health systems.

Finally, outputs do not equate to outcomes. Increasingly we are finding evidence that significant numbers of people having treatments are either not benefiting or worse in terms of outcomes. The only solution to this is to agree and measure outcomes that matter and recognise these are more important than outputs.

So, productivity as outlined in this paper, and technical efficiency (or value) using Porter’s definition are important- but insufficient. We need to think populations with a common need and outcomes that matter.