Rationing Of Health Care Research Paper

To the extent that medical care is treated substantially as a commodity, as in the USA, then the market distributes services. Individuals with more comprehensive insurance or the ability to pay out-ofpocket command a greater quantity of and more sophisticated services. But even in market systems, some life and death services in scarce supply transcend the market and are governed by different rationing schemes. In publicly funded medical systems, where most of the population has health care entitlement, whether through national health insurance or a national health service, the availability of services depends on decisions about what services will be financed and their comprehensiveness and intensity (Klein et al. 1996). Some such systems, for example the British National Health Service, allow competing private systems of care. In contrast, Canada prohibits private provision of services covered by its health insurance program.

Rationing processes and decisions are implemented at different levels of government, by sick funds, large insurance plans, provider organizations such as hospitals, clinics, and health maintenance organizations, and at the point of service delivery between clinician and patient. Disagreements are common on where in the hierarchy of health care organization varying types of rationing decisions should be made (macro, meso, or micro) and on appropriate processes for making such decisions (Mechanic 1997). At each level, rationing may be more or less explicit.

1. Explicit vs. Implicit Rationing

Explicit rationing refers to the detailed specification of how resources will be allocated by a rationing authority. Explicit rationing includes specifying eligibility rules, the specific services to be covered, the amount of coverage for recipients, intervals for receiving services, copayment requirements, the proportion of the budget to be allocated to varying services, the geographic allocation of services, the specific form and location of many services, and appliances and drugs that may or may not be allowed.

Implicit rationing, in contrast, involves setting budgetary limits but allowing the processes of allocation to be worked out at lower organizational levels (Mechanic 1979). Implicit rationing includes prospective reimbursements or capitation payments. In each case the authority sets the financial limits but then allows the budgeted or capitated entity to establish the processes for decision-making. Total responsibility is sometimes delegated to the lower unit but more typically there are some explicit guidelines and constraints over discretion. All medical systems combine explicit and implicit processes but the balance may differ considerably from one nation to another and within varying national contexts.

Klein et al. (1996) describe a range of strategies for implicitly limiting resources allocated to individuals. These include denial as beneficiaries or for the services claimed; selection of beneficiaries or services on the basis of need or likely success, or demographic characteristics such as age; deflection of care to other sectors or providers; deterrence through bureaucratic barriers such as waiting lists and other delays; diluting services by reducing intensity or restricting specialty care; and premature closure or early discharge.

2. Concerns About Rationing

Despite general acceptance of the inevitability of rationing, major issues of controversy include who should determine rationing strategies, the openness of decision processes, and whether decisions should be made by managers or clinicians (New 1997). Common criticisms are that the implicit rationing processes used are not open, often favor the privileged, and result in unequal care for persons of lesser status, education, and sophistication, and with less skill in managing bureaucratic systems (Churchill 1987). Critics also argue that implicit rationing gives doctors free reign to act on their prejudices. The lack of openness makes it difficult to assess the fairness of decision-making or to allow aggrieved individuals to successfully appeal exclusions or dilution of care. Implicit rationing is also seen as undermining democratic processes through which communities can bring their preferences to bear in the allocation of important public resources.

A significant difficulty with explicit rationing, in contrast, is that it mobilizes interest groups who seek to affect decisions about coverage. Bringing medical decisions into the public arena energizes a political process and instability in the medical care system (Mechanic 1995). While a particular treatment may be of little value in general, there may be instances, difficult to specify beforehand, where it is appropriate. Explicit rationing can not, in most instances, accommodate the complex contingencies associated with the use of a particular treatment for an individual patient.

Questions about transparency apply at all levels of decision-making. The criteria used when a national government divides a health budget among regions can have significant consequences. Funds can be allocated politically, on the basis of historical funding, and on the basis of algorithms that take account of population characteristics and dispersion, and varying concepts of health status and need. The availability of facilities and specialists differs widely among population areas and accounts for large variations in expenditures among varying population groups. Nations can seek to bring greater equity among regions, types of services, and even individuals by how they decide to distribute resources.

Within organizations, decisions are made to allocate funding among primary and specialty services, among specialty units, and between medical and related health services. These decisions can have large consequences for the likelihood that a person with a particular need can receive responsive care. At the clinical level, decisions about waiting time, access to specialized services, availability of specialized treatments, or home or hospital treatment can profoundly affect patterns of care. Debate persists as to the extent such decisions should be governed by public discussion and decision-making or left to the discretion of clinicians based on their own professional judgment and experience (Symposium The Law and Policy of Health Care Rationing 1992).

Concerns about fairness and facilitating public discussion of priorities would support making practices explicit but there are significant competing concerns. Despite increasing interest in knowledge based medical practice, much remains uncertain. There is no consensus, in most areas, on standards that apply to a diverse patient population with varying needs and inclinations and unique medical histories. Medical knowledge and practices are rapidly changing and it is uncertain whether explicit standards, once established, can be modified to keep pace with new knowledge. Moreover, medical care is an iterative process with assessment and disease management developing over time. As a complex process of discovery and negotiation, clinical practice is not easily subjected to definitive technical rules.

The notion of explicit decision-making at the level of direct patient care implies that individuals with comparable conditions have similar needs and preferences. But treatment must be flexible and take account of varying social contexts, cultural inclinations, and personal preferences. Treatments of comparable medical effectiveness may have vastly different implications for work and family life, or for comfort under varying circumstances. To treat medical care simply as a technical process, devoid of meanings, preferences, and differential consequences, contributes to dehumanizing medicine, and is unacceptable to many professionals and patients.

3. Rationing Of Specific Resources

Rationing becomes especially salient when problems result, not simply because of the unwillingness to provide more resources or allocate them fairly over some population (which may result in increased illness and death in a statistical sense), but when there is an inability to provide a life-saving resource to all identified individuals who seek it. Such situations involving the allocation of hearts, kidneys, livers, and lungs have been called ‘tragic choices’ because there are no fair or generally accepted rules for making the decisions as to who receives the resource and who dies (Calabresi and Bobbitt 1978). A variety of criteria have been applied from one occasion to another, such as allocation by age, by community contribution, by the largest opportunity to benefit, by family circumstances, by ability to cooperate in the treatment process, and many more, but all raise serious ethical conflicts (Elster 1992). Age is commonly suggested as a suitable criterion (Callahan 1990) and has been used in making tragic choices (Aaron and Schwartz 1984) but has been strongly contested. The most satisfactory criteria are medical ones based on likely technical success. But even these criteria do not adequately discriminate among potential beneficiaries, and social judgments and biases inevitably intrude (Halper 1989). For example, judgments about who can best cooperate in treatment typically give preference to patients with more education, higher intelligence, attractive personality characteristics, and strong social attachments.

Several analysts have concluded that because the equity issues cannot be resolved intellectually, the fairest mode of allocation is a lottery where persons with comparable medical qualifications have equal chances to be selected. There is little professional or public support for such selections because most people believe that consensual judgments can be made that would improve on any random process. Many rationally constructed strategies of allocation fail also because of public perceptions. The public places greater value on rescuing identified lives than on saving statistical lives (Hadorn 1991).

4. Specific Rationing Policies Practices

As evidence of inequalities in care increases, motivation to distribute limited health resources more equitably has led several countries to address rationing and seek explicit allocation principles and rules. The Oregon rationing program under Medicaid (the USA’s federal–state partnership to provide health care to poor and disabled subgroups) was followed with great interest in Europe and represents perhaps the most extreme example of explicit rationing (Leichter 1999). This effort sought to increase enrollees under its Medicaid program by selecting to rank treatments consistent with judgments of efficacy and other community values. Through an elaborate process of evaluating condition–treatment pairs, a list was developed that prioritized these pairs. The basic idea was to establish a funding line, given available funds, that excluded from coverage the lowest ranking condition–treatment pairs. The formal evaluation and ranking process and the use of community meetings to involve consumers and professionals in defining the values for performing the rankings excited the imagination of many outside observers. The process was seen as a rational and fair way to make difficult public decisions about what would and would not be paid for. The Oregon program, however, was not quite what it appeared to be. It was a very public and explicit format for designing the benefit structure. The Oregon Medicaid program is predominantly a managed care program in which health maintenance organizations (HMOs) are capitated to provide all funded services. Once capitated, HMOs are free to provide whatever services they deem necessary and need not conform to the list. Thus, the list was more an instrument for bargaining over rates than an explicit set of rules for rationing health care. Early implementation was aided by increased state funding and a favorable economy, which allowed the establishment of acceptable capitation rates. The political sustainability of such an approach under more difficult times is yet to be tested.

The British National Health Service (NHS) exemplifies implicit rationing. There are no explicit guaranteed benefits in the NHS but the system seeks to provide all necessary care within the resources available. Care is rationed by the availability of professionals and treatment facilities, by professional decisions about intensity of care and referrals, and by waiting lists for various types of services (Klein et al. 1996, Aaron and Schwartz 1984). The extraordinary professional discretion within the NHS has led to efforts for greater equity and accountability in resource use. Under recent reforms, health authorities were given purchasing responsibilities and could limit the treatments covered. The political difficulty of doing so explicitly in any but marginal aspects of medical care became evident. One exception was the effort to ration Viagra explicitly, a popular but expensive drug for treatment of impotence.

5. Ethical And Political Issues With Rationing Policies Practices

A major ethical issue concerns the appropriateness of having physicians, acting as agents of their patients, also responsible for allocation decisions. Traditionally, doctors have been seen as sole agents of their patients, trying to get them what they need. Some believe it is unethical to dilute such agency with allocation responsibilities at the bedside. Others believe that physicians must have a dual responsibility for both their patients and the ‘commons.’ With the development of HMOs and managed care strategies in the USA, financial incentives are increasingly used to encourage doctors to allocate resources efficiently. There are worries that such incentives create ethical conflicts between the doctor’s financial interests and patient care. Such conflicts are also common in unmanaged care when physicians have financial interest in diagnostic and treatment facilities to which they make referrals or in other practices for which they receive financial incentives. Studies have consistently found that such arrangements increase the use of ancillary services (Rodwin 1993).

There is widespread agreement that it is appropriate and necessary for some governing authority to establish financial constraints on health care expenditures. All national systems have such constraints in place for at least public expenditures. Few believe that it is any longer possible, even in the richest of nations, to provide open-ended financing, allowing physicians to provide all they deem useful. A more-contested issue is the extent to which such an authority, once having established such limits, should specify how the budget should be divided among different types of facilities, modes of care, professional groups, types of patient needs, and treatments and procedures, and by what criteria. The extent of authority given to the nation, as compared with regions, health districts, states, or even smaller population entities, elicits tensions in many contexts. Issues also arise as to whether organizational rationing decisions are best made by management, speciality services, or professionals exercising their best individual judgment.

A possible model that blends explicit and implicit rationing is one emphasizing clinical advocacy within a structure of procedural justice. Such a model would explicitly constrain some clinician and patient decisions through clear rules that are reasonably justified, while also allowing doctors and patients to challenge decisions and argue for revision through dispute resolution mechanisms. Such compromise models offer opportunity for achieving more consensus.

Public views of rationing processes are important because any rationing process that lacks political legitimacy becomes unstable. One of the attractions of the Oregon program was its openness and the participation of large numbers of people. In contrast, in many areas of the USA, the implementation of utilization review (a form of explicit rationing) by managed care organizations overruling physician and patient definition of need has resulted in a significant political backlash. Managed care organizations are finding that transferring risk to professional groups (implicit rationing) kindles less friction than imposing explicit decisions on professionals and patients.

It will take decades for rationing issues to be sorted out. Health care systems and facilities are experimenting with a range of strategies that may improve decisions and help achieve legitimacy for rationing. These include community representation and involvement in decision-making, surveys to elicit community preferences, focus on evidence-based services, use of treatment guidelines and pathways, involvement of patients in treatment decisions, and implementation of disease management approaches. Rationing and the ability to sustain whatever system is preferred depends on achieving a sufficient level of value consensus so that the difficult choices are widely perceived as fair and responsive to individual need.

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