case - Assignment Essays

61© The Author(s) 2016
D.H. Barrett et al. (eds.), Public Health Ethics: Cases Spanning the Globe,
Public Health Ethics Analysis 3, DOI 10.1007/978-3-319-23847-0_3

Chapter 3
Resource Allocation and Priority Setting

Norman Daniels

3.1 Resource Allocation in Public Health

There has been much discussion of resource allocation in medical systems, in the
United States and elsewhere. In large part, the discussion is driven by rising cost s
and the resulting budget pressures felt by publicly funded systems and by both
public and private components of mixed health systems. In some publicly funded
systems, resource allocation is a pressing issue because resources expended on one
disease or person cannot be spent on another disease or person. Some of the same
concern arises in mixed medical systems with multiple funding sources.

Although much has been written on resource allocation issues in medicine, there
has been less discussion about how resource allocation affects public health. Federal,
state, and local public health budgets in the United State s constrain investments in
health at those levels. In this regard, they are more like some foreign medical
systems than the more fragmented and mixed public-private medical system of the
United States. In the context of budget cuts domestically and in many countries
responding to an economic downturn, how to invest (and allocate) public health
resources is a pressing issue.

Most investments in public health aim to reduce population health risk s, but
some risks are greater than others, and resource allocation decisions must respond
to risks. Sometimes resource allocation decisions focus on the immediate payoff of
reducing risks from a specifi c disease, whereas other resource allocation decisions
affect the infrastructure needed to respond to health risks over time. In addition,
resource allocation decisions may determine who faces risks—the distribution of

The opinions, fi ndings, and conclusions of the author do not necessarily refl ect the offi cial position,
views, or policies of the editors, the editors’ host institutions, or the author’s host institution.

N. Daniels , PhD (*)
Department of Global Health and Population , Harvard T.H. Chan School of Public Health ,
Boston , MA , USA
e-mail: ndaniels@hsph.harvard.edu

mailto:ndaniels@hsph.harvard.edu

risks matters, not just the aggregate impact. Resource allocation in public health
thus focuses on deciding what risks to reduce—which depends in part on their
seriousness as population factors and who faces them—and how to reduce risks.

The cases in this chapter that discuss resource allocation force us to contemplate
decisions about priorities in public health as opposed to the more frequently
discussed medical issues about health care priorities. Later we suggest that making
decisions about these issues should be part of a deliberative process that emphasizes
transparency, stakeholder participation , and clear, relevant reasoning.

3.2 Collective Lessons from the Cases

Collectively, these resource allocation cases bring out several important points.
Separately, they raise other central issues. It is worth noting these general issues
before commenting on the more specifi c problems raised by each case.

The fi rst point the cases collectively make is that effi ciency has ethical and not
just economic importance (Daniels et al. 1996 ). If one health system is more effi cient
than another, it can meet more health needs per dollar spent than the less effi cient
one. If we want systems to meet more health needs, and we should, then we prefer
more effi cient health systems. Specifi cally, if we think we have obligations to meet
more health needs, or if we think meeting more “does more good,” and we ought to
do as much good as we can with the resources we have, then we have an ethical
basis for seeking more effi cient health systems. The economic pursuit of effi ciency
should not, then, be dismissed as something that has no ethical rationale.

A second point the cases collectively make is that effi ciency is not the only goal of
health policy , for we have concerns about how health benefi ts are distributed as well as
how they add up. Health policy is not only concerned with improving population health
as a whole, but also with aiming to distribute that health fairly (Daniels 2008 ). That
means many resource allocation decisions involve competing health policy goals.

The point about competing goals is illustrated by a problem often encountered in
policy decisions: should we always favor getting the best outcome from the use of a
resource, or should we give people “fair” chances to get a benefi t if it is at least
signifi cant (Brock 1988 )? For example, during an i nfl uenza pandemic, should we
allocate ventilators to those with the best chance of survival, or should we give
signifi cant but lesser chances to a broader group?

Reasonable people often disagree about when the difference in expected benefi ts
means we should favor best outcomes over fair chances, or even about what counts
as a fair chance. Hence, a third point emerges from the cases taken collectively:
reasonable people often disagree about the choice, and it is not possible to simply
dismiss one side as irrational or insensitive to evidence and argument (Daniels and
Sabin 2008 ). Indeed, reasonable people will disagree about how much priority to
give to the sickest (or worst off) patients. They may think we have to weigh the
seriousness of an illness against the potential benefi t that we know how to deliver,
they may disagree about how to trade off those considerations, or they may disagree

N. Daniels

about when modest benefi ts to larger numbers of people outweigh greater benefi ts
delivered to fewer people. Together these “unsolved rationing” problems—the best
outcome versus fair chances problem (when to prefer best outcomes to fair chances),
the priorities problem (how much priority to give to those who are worst off), and
the aggregation problem (when do modest benefi ts to more people outweigh signifi –
cant benefi ts to fewer people)—mean that there is pervasive ethical disagreement
underlying many resou rce allocation problems (Daniels 1993 ).

There are other common sources of disagreement. One of the most common
sources of controversy in resource allocation decisions arises when a particular inter-
vention is seen as the last chance to extend life by some—a necessity if we are to act
compassionately—and when it is seen primarily as an unproven intervention by others
that we have no obligation to provide it. Denials of such interventions in last-chance
cases have been considered the “third rail” of resource allocation decisions (Daniels
and Sabin 2008 ). Here we have two competing public value s—compassion and stew-
ardship—and most public offi cials would prefer to be seen by the public as commit-
ted to saving lives rather than as ha rd-nosed stewards of collective resources.

The cases taken collectively bring out one fi nal point: our main analytic tools for
aiding resource allocation decision making are limited in several ways, particularly
by insensitivity to various ethical issues, especially issues of distribution. In short,
these tools may take the fi rst point, about the importance of effi ciency , seriously, yet
fail to help us with the second and third lessons the cases collectively bring out, that
we are also interested in distributing effi ciently produced health fairly, and that rea-
sonable people disagree about how to do that. To see this, consider two widely used
tools: comparative effectiveness research (CER) , which has been given prominence
as a r esearch focus in the Patient Protection and Affordable Care Act of 2010 , and
cost-effectiveness analysis (CEA) . Both help to answer policy- making questions. For
example, a typical use of CER compares the effectiveness of two interventions
(drugs, procedures, or even two methods of delivery), and policy makers may want
to know if a new technology is more effective than older technologies.

Of course, they may also want to know if the new technology provides additional
effectiveness at a reasonable cost , which points to a shortcoming of much CER in
the United State s, where considerations of cost are generally avoided. Similarly, if
there is only one effective treatment for a condition, CER tells us nothing useful. It
also tells us nothing about whether a more effective intervention is worth its extra
cost. And, CER cannot help us compare intervention outcomes across different
disease conditions, since it uses no measure of health that permits a comparison of
effectiveness. Indeed, decision makers face many resource allocation questions that
cannot be answered by CER, even if CER can help avoid wasteful investments in
interventions that do not work or that offer no improvement ov er others.

In Germany, however, CER is combined with an economic analysis that takes cost
into account and that allows the calculation of “ effi ciency frontiers ” for different classes
of drugs (Caro et al. 2010 ). Presumably, this method could be extended to different
classes of public health interventions if they are grouped appropriately. To calculate an
effi ciency frontier, the effect of each drug in a class in producing some health outcome
is plotted against its cost , and the curve is the effi ciency frontier for that class of drugs.

3 Resource Allocation and Priority Setting

It is then possible to calculate if a new intervention in that drug class improves effec-
tiveness at a price more or less effi cient than what is projected from the existing effi –
ciency frontier. This use of CER allows German decision makers to negotiate the price
of treatments with manufacturers, rejecting payments that yield ineffi cient improve-
ments. German policy makers can then cover every effective intervention sold at a price
that makes it reasonably effi cient. Still, because German use of CER cannot make
comparisons across diseases, it allows vast differences in effi ciency across conditions.

CEA aims for greater scope than CER. It deploys a common unit for measuring
health outcomes , either a disability-adjusted life year (DALY) or a quality-adjusted
life year (QALY) . This unit purports to combine duration with quality, permitting us
to compare health states across a range of disease conditions. With this measure of
health effects, we can construct a ratio (the incremental cost-effectiveness ratio, or
IC ER) of the change in costs that results from the new intervention with the change
in health effects (as measured by QALYs or DALYs). We can then calculate the cost
per QALY (or DAL Y) and arrive at an effi ciency measure for a range of interven-
tions that apply to different condi tions.

Critics have noted p roblematic ethical assumptions in the construction of the
health-adjusted life-year measures and in the use of CEA (Nord 1999 ; Brock 2004 ).
To see some of these problems, consider the following table:

Rationing problem CEA Fairness

Priorities No priority to worst off Some priority to worst off
Aggregation Any agg regation is OK Some aggregations OK
Best outcomes/Fair ch ances Best outcome s Fair chances

CEA systematically departs from judgments many people will make about what
is fair. The priorities problem asks how much priority we should give to people who
are worse off. By constructing a unit of health effectiveness , such as the QALY,
CEA assumes this unit has the same value , regardless of who gets it or wherever it
goes in a life (“A QALY is a QALY” is the slogan). But intuitively, many people
think that a unit of health is worth more if someone who is relatively worse off
(sicker) gets it rather than someone who is better off (less sick) (Brock 2002 ). At the
same time, people generally do not think we should give complete priority to those
who are worse off. We may be able to do little for them, so giving them priority
means we would have to forego doing more good for others. Few would defend
creating a bottomless pit out of those unfortunate enough to be the worst off.

Similarly, CEA assumes that we should aggregate even small benefi ts. Then, if
enough people get small benefi ts, it outweighs giving large benefi ts to a few. But
intuitively, most people think some benefi ts are trivial goods that should not be
aggregated to outweigh larger benefi ts to a few (Kamm 1993 ). Curing many people’s
colds, for example, does not outwei gh saving a single life.

Finally, CEA favors putting resources where we get a best outcome, whereas
people intuitively favor giving people a fair (if not equal) chance at a benefi t.
Locating an HIV/AIDS treatment clinic in an urban area may save more lives than
placing a clinic in a rural area, but in doing so, we may deny many people a fair
chance at a signifi cant benefi t (Daniels 2004 ).

N. Daniels

In all three of these examples of rationing problems, CEA favors a maximizing
strategy, whereas people making judgments about fairness are generally willing to sac-
rifi ce some aggregate population health to treat people fairly. In each example, whether
it is giving some priority to those who are worse off, viewing some benefi ts as not
worth aggregating, or giving people fair chances at some benefi t, fairness deviates from
the health maximization that CEA favors. Yet we lack agreement on principle s that tell
us how to trade off goals of maximization and fairness in these cases. People disagree
about what trades they are willing to make, and this ethical disagreement is pervasive.

Determining priorities primarily by seeing whether an intervention achieves some
cost/QALY standard is adopting a health maximization approach. This approach departs
from widely held judgments about fairness, even where people differ in these judg-
ments. Thus, the National Institute of Clinical and Health Excellence (NICE) in the
United Kingdom has had to modify its more rigid practice of approving new inter-
ventions only if they met a cost/ QALY standard in the face of recommendations from
its Citizens Council. This council, intended to refl ect representative social and ethical
judgments among British citizens, has proposed relaxing NICE’s threshold in vari-
ous cases where judgments about fairness differed from concerns about health maxi-
mization. The judgments of the Citizens Council in this regard agree with what the
social science literature suggests are widely held views in a range of cultures and
contexts (Dolan et al. 2005 ; Menzel et al. 1999 ; Nord 1999 ; Ubel et al. 1999 , 2001 ).

There are, of course, those who criticize departures from the NICE threshold of
the sort that the Citizens Council recommended. Compromising the maximization
of health that CEA promotes may be seen as a moral error, perhaps the result of
elevating the rescue of an “identifi ed” victim (say, a cancer patient whose life might
be extended modestly by a new drug) ove r benefi ts to “statistical” lives (using the
resources to provide greater benefi ts to others). The reasonable disagreement about
how to proceed suggests that we should view CEA as an input into a discussion
about reso urce allocation, not as an algorithm for making decisions. This “aid to
decision making” role was proposed by the Public Health Service in its recommen-
dations about the use of CEA (Gold et al. 1996 ). In short, controversial ethical
positions are embedded in CEA, and using CEA uncritically commits one to these
views, even though many disagree with them.

3.3 Specifi c Ethical Issues in Resource Allocation

We have already noted that the effi ciency of a health system has ethical consequences.
But what should we count as effi ciency ? Should we use our resources to generate
more revenues for a unit of the health system—say, a hospital? Doing so would
defi ne effi ciency the way most businesses do: other things being equal, an allocation
that produces a greater return on investment is a more effi cient use of stockholder or
owner resources. Alternatively, we might narrow the range of effects to health effects
on the covered population . Then we have greater effi ciency when an allocation pro-
duces more positive health effects in that population than an alternative allocation.

3 Resource Allocation and Priority Setting

The case Guzmán brings from Colombia raises this issue forcefully. Should
hospitals, or a specifi c health plan, allocate resources favoring services (certain
treatment s) that raise more revenues than an alternative allocation (certain preven-
tive measures)? Perhaps the gains from the treatments will involve fewer population
health gains over time than those obtained by the preventive or health promotional
measures, even if they show their improvement more quickly and so look better
sooner. Which plan should the policy maker adopt?

This issue examines our purpose in designing a health system. Is it to meet the
health needs of a population or is it to provide a good return on investment for those
who invest in health services? We might think that this question is easier to answer in
a system where health care delivery is seen largely as a public undertaking aimed at
improving population health. In such a system, it might seem that there is only one
purpose behind the health care system. Return on investment for the taxpayer funding
such a system should be measured by how effi ciently the system improves popula-
tion health. In systems where resources are owned privately (and there are many of
these), however, it seems we must consider at least two goals. Even if the private
sector must in part seek to improve population health , which may be a requirement
of state-imposed health care regulation or, in some people’s opinions, a social respon-
sibility of corporations, private health-care organizations still must deliver a reason-
able return on investment for owners. Thus, policy makers within private health-care
organizations have a dual task. Balancing return on investment with improvement in
populatio n health thus becomes the central issue in the Colombian case study.

The Chilean case written by Gómez and Luco raises a similar issue, but this case
focuses on measurable differences in the cost effectiveness of certain services and
in the severity of two conditions. If we consider only cost effectiveness, we view
effi ciency in one way—the best health outcomes in the aggregate for the population
for an investment in health. If we take severity of condition into account, we might
view this as an equity demand—in which case, we have an effi ciency-equity confl ict
and must make a trade-off. Or, we might think of effi ciency as a ranking of needs by
severity of condition. In the latter, the resource allocation case turns on how we
defi ne effi ciency. Specifi cally, the Chilean category of Guaranteed Health Interventions
could include cataract surgery (the leading cause of blindness in the Chilean population),
but not multiple sclerosis (MS) treatment s, which might be viewed as maximizing
effi ciency in a standard sense. Or, the Guaranteed Health Interventions scheme
could include the less cost-effective treatment of MS but not cataract surgery, since
MS is viewed as a more severe condition (because it can be life threatening and lead
to premature death), even if it is far less prevalent than cataracts. If this were the
case, the more effi cient system, in this nonstandard view, would rank treating more
severe conditions as more effi cient than treating less severe conditions. If budget
limitations mean only one should be included in the Guaranteed Health Interventions
program, either M S or cataract surgery, which should it be?

The cataract surgery intervention delivers a signifi cant benefi t in terms of QALYs
to a larger part of the population than does the intervention package for MS, but the
greater severity of premature death seems to be an important reason for favoring
MS. If this reason is given priority over cost effectiveness and over the standard
view of effi ciency , then are less effective treatments for more severe conditions

N. Daniels

supposed to have priority over more effective and cost-effective treatments for less
severe conditions? If so, what kind of a health system does that produce if all needs
can not be met given resource limits? Alternatively, do we want a system that always
we ighs cost effectiveness more highly than the severity of a condition that some
people have? That too seems problem atic.

Suppose we think improving population health is a worthwhile and defensible
goal of a health system, we favor improving population health over increasing
revenues for the private sector (in the Guzmán case), and we also favor giving prior-
ity to cost effectiveness over severity of a condition (in the Gómez and Luco case).
A confl ict still remains between health maximization in the aggregate and concerns
about equity , as illustrated in the Blacksher and Goold case (and arguably in the
case about triage in pand emics by Smith and Viens).

In the case that Blacksher and Goold describe, the task is to decide whether to
reallocate resources from a program focused on maternal-child health and reduction
of b lack-white in fant mortality dis parities to a program that may get more health per
dollar spent through other interventions. Infant mortality among blacks and whites
has declined rapidly in the United State s; and in absolute terms, the decline has been
more rapid for blacks. Still, the ratio of black infant mortality to white infant mortal-
ity has increased. Because the public health department is in a highly segregated
city, this shift in program focus might seem to require viewing the remaining bl ack-
white health d isparities as morally a cceptable (especially given the high rate of
improvement that past programs gave to black infant mortality rates). When should
we view health disparities as morally acceptable? When should we weigh reducing
health disparities as more important than some aggregate gains in health that we
know how to produce in a population ? If public health has two goals—improving
population health and distributing that health fairly—how should we weigh the
goals when they confl ict?

One important feature of the Blacksher and Goold case, namely the opinions
within the community whose inequalities are at issue, is really a feature to which
nearly all cases warrant attending. People affected by a policy ought to have some
infl uence in determining that policy. Some people might believe this is what democ-
racy requires. A diffi culty this view of democracy faces, however, is that those who
speak for the community may not appropriately represent the community affected
by the decision. Nevertheless, the opinions of a broader range of stakeh olders may
improve deliberation (depending on how those opinions are managed). It may also
improve the acceptance of the decisions, which arguably enhances the legitimacy of
the decision-making process .

Resistance to including a broader range of stakeholder s in decision making about
health priorities may come from a concern that they bring with them “partiality.”
This resistance may come from the view that greater impartiality leads to better
deliberation. Arguably, this concern about partiality ignores the positive gains that
partiality often brings to deliberation, especially if we know how to manage such
deliberation so that we minimize the risk s that partiality sometimes brings. We need
such management skills in any case since partiality is unavoidable in most contexts.
Rather than banning what cannot be eliminated, managing partiality in deliberations
is the best way to improve decision making in contexts of reasonable disagreement.

3 Resource Allocation and Priority Setting

The confl ict between improving population health and treating people fairly can
arise in other contexts. Arguably, the problem raised by Smith and Viens about the
principle that should govern triage in pande mics can be viewed as a confl ict between
health maximization, in this case, saving the most lives, versus recognizing the
claims that the sickest people have on us for assistance. Ordinarily, health systems
give some priority to those who are sickest, but should that priority disappear in favor
of saving lives when scarce resources, such as ventilators, are allocated in pandemic
conditions? If we allocate our ventilators to the sickest patients, we may save fewer
lives than if we allocate them to those whose lives we can better expect to save. Even
if we think we should give priority to those worst off, do we ordinarily think that
concern for them should govern triage policy in pandemics? If we believe saving the
most lives trumps concerns about helping those who are sickest in pandemics, can we
justify why the priority we give to the sickest should be revised in pandemics?

Suppose we have an acceptable way of measuring the burden of disease in a popu-
lation , and according to this measure, mental illness is not given the priority it ought
to have. That is, it contributes more to the burden of disease than is normally recog-
nized in standard health systems, which provide too few services to meet mental
health needs. This is the problem upon which Rentmeester et al.’s case focuses.
Specifi cally, some mental health conditions require signifi cant resources for what
Medicaid terms as “behavioral management,” which is seen as a social support
service not a medical treatment . As a result, these services, to the extent they are
provided, fall to state-funded social service budgets. The services place a burden on
state fi nances that would be diminished if they were instead included in Medicaid
bud gets (50 % of which are fi nanced by each state). Arguably, the stigma that attaches
to mental health issues is one important reason for this underprovision of social sup-
ports for people with mental health issues. In Nebraska, the political opposition to
expanded Medicaid coverage through the Affordable Care Act ad ds to the burden on
state budgets and the potential under-servicing of these mental-health induced needs.

It takes resources to meet public health needs. Suppose we can increase the resources
to meet some of those needs by accepting a pu blic-private partnership that improves a
compromised private partner’s image? Should we meet health n eeds at this price?

That is the issue posed by the Hernández-Aguado case from Spain . Specifi cally,
should public health authorities put their stamp of approval, in the form of their
logo, on fl u epidemic notices printed on soft drink labels? The inclusion of the logo
is a requirement of the private entities that are willing to donate space on the labels
of their products. Obviously, this provides a form of public support for soft drinks
that arguably contribute to obesity in a population and thus to the prevalence of
noncommunicable diseases associated with obesity. But in view of the low budgets
available for fl u warnings, is this a price worth paying? What would the decision
maker have to know about the effects of such labels to decide this case, or is the
decision something that can be made independently of the specifi c payoffs of imple-
menting the warning system? Is there a way to consider the cost and assess whether
the outcome of the warning is worth this price? Is this simply an effi ciency calcula-
tion about the cost effectiveness of reducing a disease burden in this way?

N. Daniels

3.4 Decision-Making Process

One fi nal crosscutting issue lurks behind all the cases in the resource allocation
chapter (perhaps all the cases in the volume)—namely, the nature of the decision-
making process that addresses the issues they raise. Public health decisions about
resource allocation—judging from the cases on that topic in this volume—face
reasonable ethical disagreement. That is because the tradeoffs involved in the two
main goals of public health policy — improving population health and distributing
health fairly—are trade-offs about which people often reasonably disagree. How
can public health decisions be made in real time, given these ethical disagreements,
in ways that enhance their legitimacy and are arguably fair to all parties?

One approach to the problem is to construct a fair process for making those decisions
and to rely on the outcomes of such a process. People will judge the outcomes of a fair
process to be fair (Daniels and Sabin 2008 ). What conditions should such a decision-
making process meet if it is to be considered fair? Four conditions are arguably neces-
sary (even if some may think they are not suffi cient and want to add others): (1) The
decisions and the rationales for them should be made public. (2) They should be based
on reasons all think are relevant. (3) They should be revisable in light of new evidence
and arguments. And (4) , these conditions should be enforced so that the public can see
that they obtain. Some explanation is needed for these conditions.

The publicity condition is widely embraced, even if it is fairly strong. It calls for
the grounds for decisions—not just the content of the decisions—to be transparent.
People have a right to know why decisions that affect their health are made the
way they are. Moreover, making the reasoning for such decisions public is a way of
exposing them to scrutiny so errors in reasoning or evidence can be detected and
decisions improved. Even though we may not be able to be explicit in advance about
all criteria we use to decide such cases, that is, we may work out our reasons through
deliberation, we can explain on what we base our decisions. And that gives people
affected by our decisions the knowledge they have a right to possess.

The search for reasons that all consider relevant to making a reasonable public
health decision about resource allocation can narrow disagreement considerably.
Even if people can agree on what reasons they think are relevant—in the spirit of
fi nding mutually justifi able grounds for their decisions—they may not agree about
the weight they give these reasons. One way to test the relevance of such reasons is
to subject them to scrutiny by an appropriate range of stakeholder s. What counts as
appropriate may vary with the case. Who should be heard in deliberations is itself
worthy of deliberation. Stakeholders raise different arguments that should be heard,
and including their voices improves buy-in to decisions. Since stakeholders may not
in many instances be elected representatives, we may be skeptical about whether the
democratic process is improved by including them, but, if the deliberation is well
managed, the quality of the discussion may improve greatly.

The revisability condition , requiring that decisions be modifi able in light of new
evidence and argument, is also widely embraced and not considered controversial.
Decisions are made on the basis of evidence and arguments, and better evidence and

3 Resource Allocation and Priority Setting

arguments may emerge that require revisiting some decisions. Some decisions can
then be modifi ed, though it may be too late for others, and our consolation is that we
made the best choices we could, given the evidence and arguments.

The intent of the enforcement condition is to ensure that the other, more substan-
tive, conditions are met. Sometimes enforcement is a matter of state regulation .
Sometimes it can be the result of vol untary conformance with a process.

Since ethical disagreements abound in resource allocation decisions , we need a
process that enhances legitimacy. But can we claim that a decision-making process that
is fair yields fair outcomes? One view is that we may ultimately become persuaded by
a good argument that fairness requires a different decision than one that emerged from
a fair process. We can in this way defeat the fairness we might ordinarily attribute to the
outcome of a fair process. Does the prospect of defeating the fairness of a decision
emerging from a fair process mean that we should not attribute fairness to the out-
comes? Alternatively, we can admit that the fai rness that comes from a deliberation is
only “defeasible” fairness, but it is the fairest conclusion we ca n reach at the time.

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http://www.gpo.gov/fdsys/pkg/PLAW-111publ148/html/PLAW-111publ148.htm

Ubel, P.A., J. Richardson, and J.L. Pinto-Prades. 1999. Life saving treatments and disabilities: Are
all QALYs created equal? International Journal of Technology Assessment in Health Care 15:
738–748.

Ubel, P.A., J. Baron, and D.A. Asch. 2001. Preference for equity as a framing effect. Medical
Decision Making 21: 180–189.

3.5 Case 1: Priority Setting and Crisis of Public Hospitals
in Colombia

María del Pilar Guzmán Urrea
Department of Community Medicine
El Bosque University
Bogotá , Colombia
e-mail: mapiguzmanu@gmail.com

This case is presented for instructional purposes only. The ideas and opinions
expressed are the author’s own. The case is not meant to refl ect the offi cial position,
views, or policies of the editors, the editors’ host institutions, or the author’s host
institution.

3.5.1 Background

During the 1990s, many Latin American countries began reforming their health sys-
tems according to a neoliberal development model that emphasizes free markets
(Homedes and Ugalde 2005 ; Stocker et al. 1999 ). Approved in 1993, health reform in
Colombia was supposed to overcome problems such as low coverage, inequality in
access and use of health care services, and ineffi ciency in the allocation and distribu-
tion of resources. But the reform also hoped to encourage more focus on illness pre-
vention and health promotion and more community participation in health
decision- making processes. The reformers advocated predominantly for neoliberal
value s like effi ciency, free choice, universality, and quality. Although they were also
committed to the communitarian values of solidarity , equity , and social participation .

The Colombian health reform was one of the fi rst examples of implementing
managed competition in the developing world (Plaza et al. 2001 ). To stimulate com-
petition among insurers and health service providers, both public and private, health
reformers applied the theory of managed competition (Enthoven 1993 ). According
to this theory, competition achieves effi ciency and reduces cost , making health care
services responsive to consumer needs (Londoño and Frenk 1997 ). Hospitals
become responsive when they are able to sell services and become fi nancially sus-
tainable. To achieve sustainability, supply subsidies (direct transfers from the state
to hospitals) had to replace demand subsidies (transfers directed to the poor through
a subsided s ecurity plan).

3 Resource Allocation and Priority Setting

The Colombian reform established a General Social Security System in Health
that featured two insurance plans: (1) The Contributory Plan, fi nanced by manda-
tory contributions (formal employees and employers from the public and private
sectors). (2) The Subsidized Plan, funded by resources from the Contributory Plan
and from taxes and other sources, which covered people unable to pay (Vargas et al.
2010 ). The actors of the system are the insurance companies, the health service
providers, and the state regulatory organizations. Insurance companies contract
with health service providers, and the regulatory organizations control compliance
with the defi ned basic health packages.

To optimize resources, the reform placed controls on medical practitioners and
established explicit priority criteria based on clinical guidelines that defi ned benefi t
packages. From 1993, some adjustments to the reform have been introduced, such
as the creation, in 2012, of the Institute for Health Technology Assessment to
provide a n evidence base for health decisions. The Institute recommends which
medical technologies should be paid with public resources on the basis of which
technologies optimally improve the quality and cost effectiveness of medical care.
To determine these technologies, it conducts health outcomes research that guides
technology development, evaluation, and use (Giedion et al. 2012 ).

Nevertheless, 20 years later, the promise of reform lies unfulfi lled and many
patients still experience high out-of-pocket costs, long wait times, or denial of services.
To access health services, frustrated citizens are turning to the legal system as a last
resort and, by so doing, congesting the courts (Defensoría del Pueblo 2012 ). Physicians
are responding to economic incentives and penalties by restricting hospitalization
time and decreasing the use of expensive diagnostic tests and specialist referrals
(Abadía and Oviedo 2009 ). To further reduce labor costs, service providers have
increased the workload of health profession als and the number of patients seen per
day, whi le reducing the time spent with each patient (Defensoría del Pueblo 2007 ).

Insurance companies often take a long time to pay health service providers, and
they also contract their own service network (a process known as vertical integration),
so many public hospitals are in serious fi nancial diffi culties. Meanwhile, hospital
workers frequently disrupt the normal operation of hospitals as they strike to improve
work conditions and have their paychecks issued more promptly. Should hospitals
fail—40 % of the 968 public hospitals in Colombia are classifi ed as being at medium
or high fi nancial risk —nearly ten million people could be left without health service
(Ministerio de Salud y Protección Social 2012 ; Quintana 2002 ). Add to that, the
reforms have increased inequity, as more affl uent patients can more easily access
quality health care services than can low-income patients (Vargas et al. 2010 ).

The described problems refl ect a complex situation that requires profound
structural reform . As one way to address the immediate problems of effi ciency and
quality, Colombia in 2012 instituted public hospital accreditation. Accreditation
requires hospital directors to reach goals in service delivery related to fi nancial
viability, quality, and effi ciency. Hospital boards can now fi re directors who fail to
meet these g oals within a specifi ed period (Rodríguez 2012 ). Given the imbalances
between budgets, service demands, and ongoing costs, hospital directors face enor-
mous challenges and ethical dilemmas in formulating and executing their
mana gem ent plans.

N. Daniels

3.5.2 Case Description

You are a director of a public hospital that focuses on health promotion and prevention
activities, such as general practice, dentistry, clinical laboratory, hospitalization,
and emergency care. In developing your management plan, you must make deci-
sions about which services to prioritize . If you prioritize services that represent
higher revenues and lower costs as a way of conserving resources, you may have to
reduce priority for some services. To guide your decision making, you conducted a
retrospective study of service billing in the past 2 years and learned that the clinical
laboratory and external medical consultation yielded higher incomes. The lowest
yielding programs in the short term— vaccination , educational programs to improve
lifestyles , and provision of micronutrient supplements to children and pregnant
women—were associated with the best long-term health results.

Taking seriously your fi duciary responsibilities, you try to guarantee fi nancial
sustainability by containing labor costs, restricting consultation times, and shorten-
ing hospital stays. Your challenge is to do these things without diminishing the
quality of patient care. But because you compete with other institutions, you must
also assure suffi cient reserves to maintain and update medical equipment that will
improve the “sale of services.” Knowing that every management decision you make
will affect the population you serve, you begin to refl ect on the factors affecting
your h ospital man agement plan.

3.5.3 Discussion Questions

1. Who are the major stakeholder s in this case and what are their interests, value s,
and moral claims? Between which of them are there ethical confl ict s or
tensions?

2. Which of these interests, values, and moral claims should be prioritized? How
would you justify your priorities?

3. Would you prioritize programs that in the short term brought in needed revenues
or those programs that had highest impact long term?

4. How can tensions between the goals of effi ciency, fi nancial viability, and quality
be resolved? What weight should be assigned to each goal by the hospital board
when evaluating your performance?

5. At least in the short run, the new reforms seem to be prioritizing effi ciency, via-
bility, and quality over equity . Should a health system attain the former goals
before tackling the problem of equity, or should it insist on equity from the start?

6. Can equity in health care be achieved without doing something about wealth
inequity and other social determinants of health?

7. Should you justify your decisions by emphasizing solidarity with other hospital
directors and seeking community support?

8. How could collaborations between public health, communities and the health care
system begin to address neoliberal concern s with effi ciency, viability, and quality?

3 Resource Allocation and Priority Setting

References

Abadía, C.E., and D.G. Oviedo. 2009. Bureaucratic itineraries in Colombia: A theoretical and
methodological tool to assess managed-care health care systems. Social Science & Medicine
68(6): 1153–1160.

Defensoría del Pueblo, Colombia. 2007. Autonomía Médica y su Relación con la Prestación de los
Servicios . http://www.defensoria.gov.co/red/anexos/publicaciones/aut_med . Accessed 30
Apr 2013.

Defensoría del Pueblo, Colombia. 2012. La Tutela y el Derecho a la Salud 2011: 20 Años del Uso
Efectivo de Tutela 1992–2011. http://www.federacionmedicacolombiana.com/index.
php?option=com_content&view=article&id=1335:la-tutela-y-el-derecho-a-la-salud-2011&cat
id=58:libros&Itemid=104 . Accessed 30 Apr 2013.

Enthoven, A. 1993. The history and principles of managed competition. Health Affairs 12(suppl
1): 24–48.

Giedion, U. A., Muñoz, and A. Ávila. 2012. Serie de Notas Técnicas Sobre Procesos de Priorización
de Salud: Introducción a la Serie de Priorización Explicita en Salud. http://www.iadb.org/en/
publications/publication-detail,7101.html?id=42686%20&dcLanguage=es&dcType=All .
Accessed 30 Apr 2013.

Homedes, N., and A. Ugalde. 2005. Why neoliberal health reforms have failed in Latin America.
Health Policy 71: 83–96.

Londoño, J.L., and J. Frenk. 1997. Structured pluralism: Towards an innovative model for health
system reform in Latin America. Health Policy 41: 1–36.

Ministerio de Salud y Protección Social, Colombia. 2012. Informe de Rendición de Cuentas .
https://www.minsalud.gov.co/Documentos%20y%20Publicaciones/Audiencia%20
P%C3%BAblica%20Minsalud%202012 . Accessed 4 May 2013.

Plaza, B., A.B. Barona, and N. Hearst. 2001. Managed competition for the poor or poorly managed
competition? Lessons from the Colombian health reform experience. Health Policy and
Planning 16(suppl 2): 44–51. http://heapol.oxfordjournals.org/content/16/suppl_2/44.long .
Accessed 30 Apr 2013.

Quintana, S. 2002. Los Actores e Intermediarios del Sistema de Salud en Colombia. Médicos sin
fronteras. http://www.disaster-info.net/desplazados/informes/msf/accesointermediarios.htm .
Accessed 30 Apr 2013.

Rodríguez, C. 2012. Gerentes de Hospitales Públicos y Acreditación en Salud. http://www.elhos-
pital.com/eh/secciones/EH/ES/MAIN/IN/ESTUDIOS_CASO/doc_89824_HTML.
html?idDocumento=89824 . Accessed 30 Apr 2013.

Stocker, K., H. Watzkin, and C. Iriart. 1999. The exportation of managed care to Latin America.
New England Journal of Medicine 340(14): 1131–1136.

Vargas, I., M.L. Vásquez, A.S. Mogollón-Pérez, and J.-P. Unger. 2010. Barriers of access to care in
a managed competition model: Lessons from Colombia. BMC Health Services Research 10:
297. http://www.biomedcentral.com/1472-6963/10/297 . Accessed 30 Apr 2013.

3.6 Case 2: Intersection of Public Health and Mental Health:
Meeting Family Needs

Christy A. Rentmeester
AMA Journal of Ethics
American Medical Association
Chicago , IL , USA
e-mail: christy.rentmeester@ama-assn.org

N. Daniels

http://www.defensoria.gov.co/red/anexos/publicaciones/aut_med

http://www.federacionmedicacolombiana.com/index.php?option=com_content&view=article&id=1335:la-tutela-y-el-derecho-a-la-salud-2011&catid=58:libros&Itemid=104

http://www.iadb.org/en/publications/publication-detail,7101.html?id=42686 &dcLanguage=es&dcType=All

https://www.minsalud.gov.co/Documentos y Publicaciones/Audiencia P�blica Minsalud 2012

http://heapol.oxfordjournals.org/content/16/suppl_2/44.long

http://www.disaster-info.net/desplazados/informes/msf/accesointermediarios.htm

http://www.elhospital.com/eh/secciones/EH/ES/MAIN/IN/ESTUDIOS_CASO/doc_89824_HTML.html?idDocumento=89824

http://www.biomedcentral.com/1472-6963/10/297

Sarah Ann Kotchian
Education and Early Childhood Policy
Holland Children’s Movement and the Holland Children’s Institute
Omaha , NE , USA

Sherry Fontaine
Department of Management
University of Wisconsin-La Crosse
La Crosse , WI , USA

This case is presented for instructional purposes only. The ideas and opinions expressed
are the authors’ own. The case is not meant to refl ect the offi cial position, views, or
policies of the editors, the editors’ host institutions, or the authors’ host institutions.

3.6.1 Background

The Global Burden of Disease (GBD) compares disease burdens based on epidemio-
logical measures of prevalence, mortality, disability, and associated cost s. The GBD
for mental illness amounts to 14 % of the world’s total disease burden (World Health
Organization 2005 ). I n the United State s alone, every fi fth child suffers from a mental
disorder (Perou et al. 2013 ). Although mental illness clearly causes disabilities (Prince
et al. 2007 ), underservice to those with mental illness is commonplace. Lack of access
to mental health services counts as the fi rst of many hurdles facing families who have
a child with a mental illness. Stigma and the lack of parity in health coverage for
physical and mental illness are other hurdles for these families. Not surprisingly, these
hurdles can critically affect the development of children with mental illness.

Lack of access to mental and behavioral health services for children 5 years and
younger especially threatens their development. Rapid brain growth occurs in the
fi rst 5 years of life, which lays the foundation for cognitive, emotional, and moral
development. Exposure to chronic stress can prompt the release of hormones in the
brain that can have enduring consequences for how the adult brain is organized and
how it functions (Shonkoff and Phillips 2000 ). Because poor health can show up in
children as developmental delay, access to mental and behavioral health services is
critical. Longitudinal studies demonstrate positive and long-acting effects of early
childhood interventions, such as environmental enrichment programs, on a range of
cognitive and noncognitive skills, social behaviors, academic achievement, and
adult job performance (Heckman 2008 ). The esti mated annual rate of return on
investment from targeted early childhood development programs is 7 %, and early
intervention reduces the predictable need for higher, more costly levels of care in
later life (Heckman et al. 2010 ).

In the United State s, Medicaid is a government-funded program that provides
health coverage to people with certain disabilities and to low-income adults and
their children. The Federal Medicaid Act (FMA) requires states participating in
Medicaid programs to provide medically necessary treatment to eligible children.

3 Resource Allocation and Priority Setting

Under federal Medicaid law , states must provide “early and periodic screening ,
diagnostics, and treatment,” also known as EPSDT services, to eligible Medicaid
recipients under age 21 (U.S.C. § 1396d(a)(4)(B)). The defi nition of EPSDT
includes necessary health care , diagnostic services, treatment, and other measures
described in the Medical Assistance subchapter for the United States Code (42
U.S.C. § 1396d (a)) (2012) that correct or ameliorate defects and physical and men-
tal illnesses and conditions discovered by the screening services, regardless of
whether such services are covered under the state plan (42 U.S.C. § 1396d (r)(5))
(2013). The medical necessity standard , which is based on clinical standards of care,
refers to interventions that may be justifi ed as reasonable, necessary, or appropriate.
States must comply with the FMA standard to cover all treatments for a Medicaid-
eligible child’s physical or mental condition, even if service coverage is optional for
adults covered by Medicaid. FMA also bars states from arbitrarily denying or reducing
the amount, duration, or scope of a required service to an otherwise eligible recipient
solely because of the diagnosis, illness, or condition (Nebraska Legislature 2012 ).

Despite the provisions of FMA, the U.S. Department of Health and Human
Services, which oversees the Medicaid program, excludes certain behavioral health
treatments for children with developmental disabilities and autism (National Health
Law Program 2012 ; Autism Society of Nebraska 2012 ). In addition, some states’
Medicaid contracts allow insurers more freedom than other states to deny payment
for services. States also vary in who—the claimant or the insurer—must prove
whether coverage provisions are adequate or fall short of federal Medicaid legal
standards (Rosenbaum and Teitelbaum 1998 ). Differences among states in approval
of payment for specifi c treatments, including mental and behavioral health treat-
ment, illustrate the need for more consistency in Medicaid coverage provisions and
the lack of parity between mental and physical health coverage. Mental health ben-
efi ts must be offered at parity with medical services to newly eligible recipients as
part of the 2010 Patient Protection and Affordable Care Act (ACA), and Medicaid
expansion controversy is clear evidence that parity is a work in progress (Mental
Health America 2013 ; U.S. Department of Labor 2008 ).

Because of inadequate coverage for mental and behavioral health services for
Medicaid-eligible children , some parents have no option other than to surrender their
child to the child welfare system so that the child will receive full coverage for neces-
sary mental and behavioral health care services. This results in signifi cant cost-shift-
ing from Medicaid to the state’s child welfare system. That is, when a state provides
federally mandated services to Medicaid-eligible children, it receives a fi nancial
match from the federal government to pay the cost s. When a state denies federally
mandated Medicaid services and a family surrenders a child to state custody so the
child can receive care, the state pays the expense of the previously denied Medicaid
costs plus the expense of entitlements the child acquires as a ward of the state.

The ACA Medicaid expansion offers a window of opportunity to increase cover-
age for behavioral health treatment for children with mental illnesses. Although the
federal government will bear the primary fi nancial burden of Medicaid expansion,
some states have elected, for political reasons, not to participate in this expansion.
For participating states, ACA Medicaid expansion will replace state and local men-
tal health services funds with federal Medicaid money that will cover a wider range

N. Daniels

of home and community-based services for mental illness treatment (Bazelon
Center for Mental Health Law 2012 ).

Public health agencies and leaders often provide input for the Medicaid system,
helping to develop protocols, criteria, and rules about which treatments are defi ned
as medically necessary . Such decisions about medical necessity affect clinicians,
patients, and families because they determine which treatments get recommended at
the clinical level and infl uence which treatments insurers cover.

3.6.2 Case Description

You are the Medicaid director of a state with the country’s highest percentage of
children in the child welfare system. Twenty-fi ve percent of children in the state’s
foster care system are there not because of abuse or neglect, but because of behav-
ioral problems and mental illnesses. As a state offi cial, you are aware that this results
in signifi cant cost-shifting from Medicaid to the state’s child welfare system.

Recently, the case of 4-year-old Sam has come to your attention. Sam’s family
cannot afford mental and behavioral health care for Sam, although he is Medicaid-
eligible and insured through Magiscare (a private company with a state contract to
administer Medicaid for mental and behavioral health services). Sam’s parent s are
considering surrendering their boy to become a state ward to get him the mental
health services he needs.

Sam, you learn, eats random objects and dirt, throws tantrums, bangs his head on
the ground, hits and bites himself and others, and often runs away. Recently diag-
nosed by his physician as having autism, Sam was referred to a psychologist who
recommended outpatient behavioral therapy. Both the physician and the psycholo-
gist expect this therapy to be covered through the family’s Magiscare plan.

Magiscare denied the psychologist’s requests for payment on the grounds that,
for children of Sam’s age, behavioral management is not covered under state law
because it is not “medically necessary.” Magiscare substantiated their denial of
payment because Sam’s behaviors primarily refl ect developmental disabilities
related to autism, which are not covered under their contract with the state. When
you ask the Magiscare executive director about this case, she suggests that Sam’s
parent s could attend therapy sessions to help them cope with their son’s behaviors,
but she reasserts that behavioral management is not covered for children as young
as Sam under state law because it is not medically necessary.

Members of the state legislature and child mental health advocacy groups are try-
ing to expand access to home-based and community-based mental health services.
They have asked you to support their efforts. You also consider that your governor,
who is your boss, has publically stated his fi rm opposition to ACA Medicaid expan-
sion, thus denying the state the opportunity to expand coverage for children’s mental
and behavioral health treatment through the ACA. At present, you know that your
state is offering limited mental and behavioral health service s and that narrow defi ni-
tions of medical necessity are used to limit access to those services.

As the state Medicaid director, which steps should you take?

3 Resource Allocation and Priority Setting

3.6.3 Discussion Questions

1. Who are the main stakeholder s in this case, and what are their primary interests?
2. “Passing” the expense of coverage denied by Medicaid to other components of pub-

lic service, such as the child welfare system, has fi scal and social implications.

(a) What are some of these implications?
(b) How should prevalence, mortality, disability, and cost be factored into think-

ing about ways to balance short- and long-term risk s and benefi ts to indi-
viduals and to the public in this case?

3. Suppose a policy advisor warns that expanding behavioral health care for chil-
dren will strain the Medicaid budget and require cuts in services for adults or
reduce their eligibility.

(a) How should you respond?
(b) Which considerations or priorities would guide your funding allocations?

4. What role should ethical principle s such as stewardship , public health leader-
ship , and moral courage play in this case?

5. Medical necessity implies an acute care model of health service delivery and
refl ects a clinical perspective. How well does this idea apply to a public health
prevention model of health service delivery? Are there better alternatives?

6. Parity in insurance coverage for mental health is federally mandated for private
insurers, which covers most citizens, but has proven to be an elusive goal for
people who do not have private insurance or do not have enough coverage.
Medicaid is a public ( government funded) insurance program, not a private one.
Although Medicaid benefi ciaries receive coverage for medically necessary men-
tal health services, e ach state defi nes medical necessity uniquely.

(a) Should a federal mandate defi ne medical necessity for mental and behavioral
services?

(b) What fi nancial implications would such a mandate have from a state per-
spective and from an overall perspective?

7. The term principle-policy gap can be used to characterize situations in which
most people support health coverage in principle ; but in practice, they are unable
to pay for coverage or unwilling to take the political , social, cultural, or fi scal
risk s necessary to enable such coverage. What do such gaps tell us about which
value s the majority favors, and how might the term principle-policy gap help us
understand the dynamics in this case? What roles should public health leaders
play in responding to principle-policy gaps?

Acknowledgements The authors thank student Chelsea Williams for her assistance in assem-
bling the facts of the case. We also thank Creighton University’s Center for Health Policy & Ethics.

N. Daniels

References

Autism Society of Nebraska. 2012. Nebraska Appleseed—Cases of denial of behavioral health
coverage for children are needed. http://www.autismnebraska.org/2012/06/13/nebraskaapple-
seed-cases-of-denial-of-behavioral-health-coverage-for-children-are-needed/ . Accessed 6 Nov
2012.

Bazelon Center for Mental Health Law. 2012. Take advantage of new opportunities to expand
medicaid under the Affordable Care Act: A guide to improving health coverage and mental
health services for low-income people, following the Supreme Court ruling on the Affordable
Care Act. http://www.bazelon.org/LinkClick.aspx?fi leticket=cwAuDZLEmQI%3D&ta
bid=619 . Accessed 3 June 2013.

Heckman, J.J. 2008. Schools, skills, and synapses. Economic Inquiry 46(3): 289–324.
Heckman, J.J., S.H. Moon, R. Pinto, P.A. Savelyev, and A. Yavitz. 2010. The rate of return to the

High/Scope Perry Preschool Program. Journal of Public Economics 94(1–2): 114–128.
Mental Health America. 2013. Medicaid expansion fact sheet. http://www.mentalhealthamerica.

net/go/action/policy-issues-a-z/healthcare-reform/fact-sheet-medicaid-expansion/fact-sheet-
medicaid-expansion . Accessed 23 May 2013.

National Health Law Program. 2012. Lawsuit fi led to protect the rights of Nebraska children with
autism and development disability. http://www.conntact.com/component/content/article/121-
press-release/13284-lawsuit-fi led-to-protect-the-rights-of-nebraska-children-with-autism-an-
ddevelopmental-disabilities.html . Accessed 6 Nov 2012.

Nebraska Legislature. 2012. Floor debate on LB 1063. http://www.legislature.ne.gov/
FloorDocs/102/PDF/Transcripts/FloorDebate/r2day47 . Accessed 1 Apr 2013.

Perou, R., R.H. Bitsko, S.J. Blumberg, et al. 2013. Mental health surveillance among children –
United States, 2005–2011. Morbidity and Mortality Weekly Report 62(2): 1–35.

Prince, M., V. Patel, S. Saxena, et al. 2007. No health without mental health. Lancet 370:
859–877.

Rosenbaum, A., and J.B. Teitelbaum. 1998. Coverage decision-making in Medicaid managed
care: Key issues in developing managed care contracts. Washington, DC: The Center for
Health Services Research and Policy, George Washington University Medical Center, School
of Public Health and Health Services. http://sphhs.gwu.edu/departments/healthpolicy/CHPR/
downloads/behavioral_health/bhib-1 . Accessed 1 Apr 2013.

Shonkoff, J.P., D.A. Phillips, and Committee on Integrating the Science of Early Childhood
Development; Board on Children, Youth, and Families; Institute of Medicine; Division of
Behavioral and Social Sciences and Education (eds.). 2000. From neurons to neighborhoods:
The science of early childhood development. Washington, DC: National Academy Press.

United States Code. 2012, 2013. Title 42: Public health and welfare. 42 U.S.C.A § 1396d(a)(4)(B)
(West 2012) and 42 U.S.C. § 1396d (r)(5) (suppl 2013). http://www.gpo.gov/fdsys/pkg/
USCODE-2010-title42/pdf/USCODE-2010-title42-chap7-subchapXIX-sec1396d .
Accessed 29 May 2013.

U.S. Department of Labor. 2008. The Mental Health Parity and Addiction Equity Act of 2008: Fact
sheet. Pub L 110–343. http://www.dol.gov/ebsa/newsroom/fsmhpaea.html . Accessed 23 May
2013.

World Health Organization (WHO). 2005. Mental health: Facing the challenges, building solu-
tions. Report from the WHO European Ministerial Conference. Copenhagen: WHO Regional
Offi ce for Europe.

3 Resource Allocation and Priority Setting

http://www.autismnebraska.org/2012/06/13/nebraskaappleseed-cases-of-denial-of-behavioral-health-coverage-for-children-are-needed/

http://www.bazelon.org/LinkClick.aspx?fileticket=cwAuDZLEmQI=&tabid=619

http://www.mentalhealthamerica.net/go/action/policy-issues-a-z/healthcare-reform/fact-sheet-medicaid-expansion/fact-sheetmedicaid-expansion

http://www.conntact.com/component/content/article/121-press-release/13284-lawsuit-fi led-to-protect-the-rights-of-nebraska-children-with-autism-anddevelopmental-disabilities.html

http://www.legislature.ne.gov/FloorDocs/102/PDF/Transcripts/FloorDebate/r2day47

http://sphhs.gwu.edu/departments/healthpolicy/CHPR/downloads/behavioral_health/bhib-1

http://www.gpo.gov/fdsys/pkg/USCODE-2010-title42/pdf/USCODE-2010-title42-chap7-subchapXIX-sec1396d

http://www.dol.gov/ebsa/newsroom/fsmhpaea.html

3.7 Case 3: Public-Private Partnerships: Role of Corporate
Sponsorship in Public Health

Ildefonso Hernández-Aguado and Blanca Lumbreras
Department of Public Health, History of Science and Gynecology
Universidad Miguel Hernández and CIBER de Epidemiología y Salud Pública
San Juan, Alicante , Spain
e-mail: ihernandez@umh.es

This case is presented for instructional purposes only. The ideas and opinions
expressed are the authors’ own. The case is not meant to refl ect the offi cial position,
views, or policies of the editors, the editors’ host institutions, or the authors’ host
institutions.

3.7.1 Background

Public health systems are usually underfunded in comparison with health care sys-
tems. In fact, the Organisation for Economic Co-operation and Development
(OECD) countries allocate on average only 3 % of their health spending to pub lic
health and prevention activities (OECD 2011 ). This low funding of public health
programs hinders the capacity to implement effective public health policies (Robert
Wood Johnson Foundation 2011 ).

Population health challenges, such as infl uenza pandemics, are increasingly
complex, and tackling them involves urgently executing a wide array of public
health measures to prevent disease transmission. In the case of infl uenza pandemics,
measures can vary from border quarantine, social distancing, provision of antivirals
and vaccine s, and personal hygiene strategies. Recommendations often need to be
made quickly even when knowledge about the seriousness and potential health and
social effects are incomplete. The target for preventive interventions is the entire
population. However, resources for intense and sustained health campaigns through
mass communications are expensive. In addition, the social determinants of the dis-
ease must be understood and considered (Crowcroft and Rosella 2012 ). This typi-
cally involves the need for policies that engage the health and non-health sectors,
such as educational policies and social or economic factors (Savoia et al. 2012 ).
This complexity, together with decreasing funds and other factors, has contributed
to increasing private sector involvement in health care.

According to the World Health Organization (WHO), a public-private partner-
ship gathers a set of actors for the common goal of improving population health
through agreed roles and principle s. This may also be described as public sector
programs with private sector participation (WHO 2013 ). WHO has described sev-
eral types of partnerships, including philanthropic, transactional, and transforma-
tional. Sponsorship is a form of a public-private partnership defi ned as “any form of
monetary or in-kind payment or contribution to an event, activity, or individual that

N. Daniels

directly or indirectly promotes a company’s name, brand, products, or services”
(Kraak et al. 2012 ). In this sense, sponsorship is a commercial transaction, not type
of philanthropy.

Public-private partnerships have become increasingly common for public health
campaigns. Some transnational companies and their corporate foundations collabo-
rate with public institutions, such as United Nation s agencies and government s, to
tackle complex public health problems, such as treatment of diarrhea in developing
countries (Torjesen 2011 ), tuberculosis , and malaria (Ridley et al. 2001 ). These col-
laboration s have been encouraged by international institutions and experts as a way
to mobilize resources and expertise, which could complement the public sector.
WHO has also encouraged using public-private partnerships to deliver health ser-
vices for a range of health problems, including HIV infection, malaria , tuberculosis ,
trachoma, and vaccine-preventable diseases (Buse and Walt 2000a , b ). However,
corporations’ increasing role in public health has been criticized as jeopardizing the
mission of public health and its commitment to population health (Hastings 2012 ;
Ludwig and Nestle 2008 ). Some corporations have used tactics that discredit public
health actions, such as distorting scientifi c information and using fi nancial tactics
and political infl uence to avoid unfavorable regulations (Wiist 2011 ).

Public health profession als, public health agencies, and governments often must
decide whether to collaborate with the private sector to improve population health.
These decisions are increasingly frequent as health department budgets shrink and
public-private partnerships are seen as a way to secure funds for core public health
programs. Ethical considerations can help us decide whether and when to form such
partnerships. However, the available public health ethics frameworks (e.g., Public
Health Leadership Society 2002 ; Nuffi eld Council on Bioethics 2007 ; Kass 2001 )
do not specifi cally discuss public-private partnerships. Only the Public Health
Leadership Society provides guidance for such collaborations. Principle 10 pro-
poses that, “Public health institutions and their employees should engage in collabo-
rations and affi liations in ways that build the public’s trust and the institution’s
effectiveness.” Continued discussion about the ethical implications of private-public
partnerships is needed.

3.7.2 Case Description

Top health offi cials in an industrialized country have declared a public health emer-
gency due to an infl uenza pandemic. The head of the country’s health department
receives a call from the president of a multinational company that produces sugary,
high-calorie drinks. The company president expresses his concern about the pan-
demic and wants to collaborate with the government to prevent the spread of fl u.
The company offers the health department a considerable amount of space, one-
third of each can, on its star product (a soft drink) free of charge, to include mes-
sages on fl u prevention . The company insists that the health department logo be
included on the can along with the preventive messages. For them, the association

3 Resource Allocation and Priority Setting

between the health department (through the logo) and their product is essential for
the collaboration as it would be an acknowledgement by the health department of
the company’s social responsibility.

The head of the health department arranges a meeting with several health authori-
ties and offi cials to consider the offer. On one side, some members of the group sup-
port the proposal because of the need to carry out far-reaching public health
campaigns to limit the impact of pandemic fl u. At that stage, the incidence of pan-
demic fl u is increasing quickly and the number of new outbreaks in schools is wor-
rying the health authorities and the population . There have been recent budget cuts to
the health department, and some offi cials argue the company’s contribution may be
the best option to ensure a far-reaching campaign on prevention measures to benefi t
the population. They see sponsorship as a form of social responsibility because the
company does not have any apparent economic interest in fl u-related activities. They
also note that there are no other companies offering a similar collaboration.

But other offi cials say the company’s soft drink products contribute to the obe-
sity and diabetes epidemic and that the company’s use of the health department logo
would label it a pro-health industry with the backing of the highest health authority
in the country. They also raise concerns about risking the independence of the health
department in future regulatory action on sugar-rich beverages.

As the hea d of the health department, you must decide if you should collaborate
with the company.

3.7.3 Discussion Questions

1. What considerations should the health department director weigh when deciding
whether to collaborate with the beverage company?

2. Who are the major stakeholder s the health department should consider, and what
value s might each of these stakeholders bring to this decision?

3. In making your decision, what values should be prioritized?
4. What positive or negative impacts would displaying the health department logo

on the soft drink cans have on health department operations?
5. How might sponsorship by a company that produces sugary beverages affect

public trust in the health department and the institution’s effectiveness?
6. Would the decision be different if the company produced healthy foods and the

department’s logo was placed on a healthy product?
7. Would community involvement facilitate decision making and the consideration

of the ethical questions? What ethical criteria or guidance should be established
to accept or reject a future donations or sponsorship of a public health program
by a company?

Acknowledgements We thank Mr. Jonathan Whitehead for language editing.

N. Daniels

References

Buse, K., and G. Walt. 2000a. Global public-private partnerships: Part I—A new development in
health? Bulletin of the World Health Organization 78: 549–561.

Buse, K., and G. Walt. 2000b. Global public-private partnerships: Part II—What are the health
issues for global governance? Bulletin of the World Health Organization 78: 699–709.

Crowcroft, N.S., and L.C. Rosella. 2012. The potential effect of temporary immunity as a result of
bias associated with healthy users and social determinants on observations of infl uenza vaccine
effectiveness; Could unmeasured confounding explain observed links between seasonal infl u-
enza vaccine and pandemic H1N1 infection? BMC Public Health 12: 458.

Hastings, G. 2012. Why corporate power is a public health priority. British Medical Journal 345:
e5124.

Kass, N.E. 2001. An ethics framework for public health. American Journal of Public Health
91(11): 1776–1782.

Kraak, V.I., P.B. Harrigan, M. Lawrence, P.J. Harrison, M.A. Jackson, and B. Swinburn. 2012.
Balancing the benefi ts and risks of public-private partnerships to address the global double
burden of malnutrition. Public Health Nutrition 15(3): 503–517.

Ludwig, D.S., and M. Nestle. 2008. Can the food industry play a constructive role in the obesity
epidemic? JAMA 300(15): 1808–1811.

Nuffi eld Council on Bioethics. 2007. Public health: Ethical issues. London: Nuffi eld Council on
Bioethics. http://nuffi eldbioethics.org/wp-content/uploads/2014/07/Public-health-
ethicalissues . Accessed 22 May 2015.

Organisation for Economic Co-operation and Development (OECD). 2011. Health at a glance
2011. In OECD indicators. OECD Publishing. http://www.oecd.org/els/healthsys-
tems/49105858 . Accessed 22 May 2015.

Public Health Leadership Society. 2002. Principles of the ethical practice of public health. http://
phls.org/CMSuploads/Principles-of-the-Ethical-Practice-of-PH-Version-2.2-68496 .
Accessed 22 May 2015.

Ridley, R.G., J. Lob-Levyt, and J. Sachs. 2001. A role for public-private partnerships in controlling
neglected diseases? Bulletin of the World Health Organization 79(8): 771–777.

Robert Wood Johnson Foundation. 2011. Investing in America’s health: A state-by-state look at
public health funding and key health facts. http://healthyamericans.org/report/83/ . Accessed 22
May 2015.

Savoia, E., M.A. Testa, and K. Viswanath. 2012. Predictors of knowledge of H1N1 infection and
transmission in the U.S. population. BMC Public Health 12: 328.

Torjesen, I. 2011. Coca-Cola supply chain helps bring diarrhoea treatments to developing world.
British Medical Journal 343: d5825.

Wiist, W.W. 2011. The corporate play book, health and democracy: The snack food and the bever-
age industry’s tactics in context. In Sick societies: Responding to the global challenge of
chronic diseases , ed. D. Stuckler and K. Siegel, 206–216. New York: Oxford University Press.

World Health Organization (WHO). 2013. Public-private partnerships for health. http://www.
who.int/trade/glossary/story077/en/ . Accessed 22 May 2015.

3 Resource Allocation and Priority Setting

http://nuffieldbioethics.org/wp-content/uploads/2014/07/Public-health-ethicalissues

http://www.oecd.org/els/healthsystems/49105858

http://phls.org/CMSuploads/Principles-of-the-Ethical-Practice-of-PH-Version-2.2-68496

http://healthyamericans.org/report/83/

http://www.who.int/trade/glossary/story077/en/

3.8 Case 4: Black-White Infant Mortality: Disparities,
Priorities, and Social Justice

Erika Blacksher
Department of Bioethics and Humanities
University of Washington
Seattle , WA , USA
e-mail: eb2010@u.washington.edu

Susan D. Goold
Department of Internal Medicine and Department of Health Management
and Policy Center for Bioethics and Social Sciences in Medicine
University of Michigan
Ann Arbor , Michigan , USA

3.8.1 Background

Preterm births, the leading cause of infant mortality, are increasing annually worldwide
(World Health Organization 2012 ). The United State s shares company with Nigeria,
India, and Brazil among the top ten countri es with the highest numbers of preterm births
and ranks 31st among Organisation for Economic Co-operation and Development (OECD)
nations in infant mortality (OECD 2010 ). Within the United States, racial and ethnic
disparities in infant mortality remain entrenched and have increased (MacDorman and
Mathews 2009 ). U.S. health policy leaders have made the elimination of health dispari-
ties a top public health priority (Centers for Disease Control and Prevention 2011 ;
U.S. Department of Health and Human Services 2011 ). Infant mortality is an important
area of focus for eliminating disparities, both in its own right and because the rate of
infant mortality serves as an indicator of the nation’s health due to its association with
maternal health, social and economic conditions, racial discrimination, access to health
care, and public health practices (MacDorman and Mathews 2009 ).

During the twentieth century, U.S. infant mortality declined 93 % (MacDorman
2011 ). In 1900, about 100 infants died per 1000 live births. By 2000, that number
fell to 6.89. During the last half of the twentieth century, the rate of black infant
mortality dropped dramatically. In 1950, black infant mortality was 43.9 deaths per
1000 live births compared with 26.8 deaths per 1000 live births among whites
(Mechanic 2002 ). But by 1998 black infant mortality fell to 13.8 deaths per 1000
live births compared with 6.0 deaths per 1000 live births among whites. As these
numbers show, both groups made signifi cant absolute gains, with blacks gaining
more in absolute terms—a reduction of 30.1 for blacks and 20.8 for whites. Yet,
black infant mortality still remained about twice that of whites.

N. Daniels

These disparities have persisted in the twenty-fi rst century. In 2006, non- Hispanic
black women experienced the highest rate of infant mortality, with 13.4 infant
deaths per 1000 live births, while non-Hispanic white women had a considerably
lower rate, with 5.6 infant deaths per 1000 live births. Citing a 2006 report from the
National Healthy Start Association, MacDorman and Mathews ( 2009 ) report that
programmatic efforts to reduce disparities in black-white infant mortality have had
some successes at local levels, but eliminating the disparities is diffi cult.

The U.S. Centers for Disease Control and Prevention and the U.S. Department of
Health and Human Services have prioritized both the elimination of health dispari-
ties and improvement in overall population health. These twin goals—one distribu-
tive, the other aggregative—are separate and sometimes confl ict (Anand 2004 ).
Increases in health disparities often accompany advances in aggregate gains in popu-
lation health (Mechanic 2007 ). Although this case is specifi c to the United State s, the
dilemma is not. Data show that signifi cant progress on child mortality has been made
in many countries but that this overall success is often coupled with increased
inequalities between advantaged and disadvantaged groups (Chopra et al. 2012 ). In
China and India, for example, disparities in mortality persist between boys and girls
younger than 5 years, a function of entrenched gender discrimination (You et al.
2010 ). These examples raise challenging questions about how ethically to assess
such cases and set priorities for the allocation of scarce public health resources.

3.8.2 Case Description

You serve as the director for the local health department in a racially segregated
urban city in the Midwest with one of the greatest concentrations of African
Americans in the United States. The city has a long history of civil rights activism
that led to protests and marches that ultimately empowered and mobilized black
communities and organizations. Your health department has a history of prioritizing
maternal-child health and the elimination of black-white disparities in infant mor-
tality in its programs, an investment of resources affi rmed by the city residents
through the department’s community outreach program and planning processes.

Chronic underfunding of public health, made worse by the economic downturn,
has resulted in drastic and unprecedented reductions in the public health budget. In
consultation with your staff and community board of health, you have raised the
possibility of redirecting resources from maternal-child health into other programs
based on a number of practical and ethical considerations. As with national statis-
tics, the city has seen signifi cant declines in black infant mortality, even as black-
white disparities remain. You note that although the maternal-child health programs
are cost-effective, their impact on reducing black-white disparities seems to have
stalled. Other programs appear to meet targets more consistently. To help support
these other programs, you note that allocating resources to more effective programs
provides more “health” per dollar, thus meeting the utilitarian demand to maximize
overall health, which many view as the primary goal of public health and health
policy (Powers and Faden 2006 ). In addition, although black-white disparities in

3 Resource Allocation and Priority Setting

infant mortality persist, blacks have made signifi cant gains, declining more than
whites in some decades. You note that remaining inequalities could be deemed ethi-
cally acceptable by some standard s of equity , such as the “maximin” principle .
Although this distributive principle is subject to interpretation (Van Parijs 2003 ), it
is generally understood to require that social and economic inequalities work to
benefi t society’s least advantaged groups. Thus, inequalities (even signifi cant ones)
are morally acceptable as long as the least advantaged have signifi cantly benefi ted
(Powers and Faden 2006 ).

The director of community outreach proposes that the health department not
make this decision unilaterally, but instead listen to community opinions on these
questions of priorities and fairness. He suggests that the health department collabo-
rate with community partners to host a series of public forums. He insists that a
topic of such historic and contemporary concern to the community must be subject
to public deliberation. Despite having a history of supporting community discus-
sions, you are concerned about the cost of community forums, noting that they will
drain resources from an already slim budget.

3.8.3 Discussion Questions

1. Have local health departments met their ethical obligations when community
health improves overall, but health disparities persist? If not, why not? If so, on
what grounds?

2. Is there something about infant mortality that makes it special in considerations
of fairness? If so, what is it?

3. Should the role of race and racism in infant mortality shape priority setting and
the allocation of resources in public health? If so, why?

4. On what grounds and how should you as the local health department director
make resource allocation decisions? What standard s—evidence, principle s of
justice , public opinion—should infl uence priority setting?

5. Should the community have a role in identifying community health priorities or,
more specifi cally, in providing input into allocation decisions that directly affect
them? If so, how should the community be involved and who represents the
community?

References

Anand, S. 2004. The concern for equity in health. In Public health, ethics, and equity , ed. S.
Anand, F. Peter, and A. Sen, 15–20. New York: Oxford University Press.

Centers for Disease Control and Prevention. 2011. About CDC’s Offi ce of Minority Health &
Health Equity (OMHHE). http://www.cdc.gov/minorityhealth/OMHHE.html . Accessed 29 Apr
2013.

N. Daniels

http://www.cdc.gov/minorityhealth/OMHHE.html

Chopra, M., H. Campbell, and I. Rudan. 2012. Understanding the determinants of the complex
interplay between cost-effectiveness and equitable impact in maternal and child mortality
reduction. Journal of Global Health 2(1): 1–10.

MacDorman, M.F. 2011. Infant deaths—United States, 2000–2007. MMWR Supplement 60:
49–51.

MacDorman, M.F., and T.J. Mathews. 2009. The challenge of infant mortality: Have we reached a
plateau? Public Health Reports 124(5): 670–681.

Mechanic, D. 2002. Disadvantage, inequality, and social policy. Health Affairs 21(2): 48–59.
Mechanic, D. 2007. Population health: Challenges for science and society. The Milbank Quarterly

85(3): 533–559.
Organisation for Economic Co-operation and Development (OECD). 2010. OECD health data:

Infant mortality. https://data.oecd.org/healthstat/infant-mortality-rates.htm . Accessed 25 May
2015.

Powers, M., and R. Faden. 2006. Social justice: The moral foundations of public health and health
policy. New York: Oxford University Press.

U.S. Department of Health and Human Services. 2011. HHS action plan to reduce racial and
ethnic health disparities. http://www.minorityhealth.hhs.gov/npa/templates/content.
aspx?lvl=1&lvlid=33&ID=285 . Accessed 25 May 2015.

Van Parijs, P. 2003. Difference principles. In The Cambridge companion to Rawls , ed. S. Freeman,
200–240. Cambridge: Cambridge University Press.

World Health Organization (WHO). 2012. Born too soon: The global action report on preterm birth.
http://whqlibdoc.who.int/publications/2012/9789241503433_eng . Accessed 29 Apr 2013.

You, D., G. Jones, T. Wardlaw, and M. Chopra. 2010. Levels and trends in child mortality, 1990–
2009. Lancet 376(9745): 931–933.

3.9 Case 5: Priority Setting in Healt h Care: Ethical Issues

M. Inés Gómez and Lorna Luco
Centro de Bioética, Facultad de Medicina
Clínica Alemana–Universidad del Desarrollo
Santiago , Chile
e-mail: migomezb@gmail.com

This case is presented for instructional purposes only. The ideas and opinions
expressed are the authors’ own. The case is not meant to refl ect the offi cial position,
views, or policies of the editors, the editors’ host institutions, or the authors’ host
institutions.

3.9.1 Background

The Chilean Sy stem of Guarantees in Health—created by law in 2004—aims to
establish guaranteed health care interventions in health promotion, disease and
injury prevention , diagnosis and treatment , rehabilitation and palliative care
(Ministerio de Salud 2004 ). The law mandates that public and private insurers pro-
vide the resources needed to protect the public against excessive health-related

3 Resource Allocation and Priority Setting

https://data.oecd.org/healthstat/infant-mortality-rates.htm

http://www.minorityhealth.hhs.gov/npa/templates/content.aspx?lvl=1&lvlid=33&ID=285

http://whqlibdoc.who.int/publications/2012/9789241503433_eng

spending and guarantee timely and universal access to authorized interventions
based on standard s of care. 1

National health objectives, established by the Ministry of Health, determine the
list of guaranteed interventions. This list, however, is reviewed every 3 years and
amended as new scientifi c and health information emerges. As of 2013, the System
o f Guarantees in Health included interventions for 80 health-related conditions
(Ministerio de Salud 2013 ), accounting for almost 60 % of the Chilean burden of
disease. The System of Guarantees in Health is a priority system based on acknowl-
edged criteria, namely scientifi c evidence and socially shared value s. For the system
to be effective, the criteria must be transparent, publicly accepted, and open to
review and modifi cation.

The law that created the System of Guarantees in Health also mandated a proce-
dure for selecting the guaranteed interventions (Ministerio de Salud 2004 ). The
procedure factors in public opinion research to identify social consensus on health
priorities, studies to identify effective interventions that prolong and improve qual-
ity of life, and assessments of interventions’ cost effectiveness (Burrows 2008 ). The
procedure determines priorities with an algorithm that includes these factors and
information on disease burden and health system capacity (Missoni and Solimano
2010 ). After choosing the health interventions, the health ministry elaborates on a
package of interventions related to specifi c health conditions and develops clinical
guide lines for such interventions.

3.9.2 Case Description

You direct a team within the Ministry of Health that is responsible for recommend-
ing priorities for guaranteed health interventions. The priority ranking system
emphasizes the selection of cost-effective interventions for conditions with the
greatest burden. However, the health ministry also has authorized including expen-
sive interventions that are less effective or treating health conditions with low prev-
alence, if that condition or those interventions signifi cantly impact health. Because
of budget reductions, a number of interventions are under review. Your team has
been asked to recommend funding interventions for two health
conditions—cataract (a common condition with highly effective treatment ) and
multiple sclerosis (a less prevalent condition but one with signifi cant health and
social impact).

1 Law 19.966 for the System of Guarantees in Health includes the following defi nitions for guaran-
tees: Guaranteed Access —Public and private health insurers must grant the resources to provide
guaranteed interventions; Guaranteed Opportunity —Guaranteed interventions must be delivered
within a deadline established in the protocols elaborated by the Ministry of Health; Guaranteed
Quality: Interventions must be delivered by registered and accredited health care providers;
Financial Protection —A maximum copayment is established to avoid the insured falling into
fi nancial insolvency.

N. Daniels

Cataract, the main cause of blindness, primarily affects people over 40. This
health problem has a high impact as measured by quality-adjusted life years
(QALYs) (Ministerio de Salud 2007 ). Its surgical treatment is effective for 80–95 %
of patients. The package of guaranteed interventions includes diagnostic confi rma-
tion within 180 days after suspected diagnosis and surgical treatment 90 days after
confi rmation. In 2013, it was expected that 48,424 cataract surgeries would be
performed in Chilean public hospitals and 416 in private institutions.

Multiple sclerosis , an autoimmune infl ammatory disease leading to demyelin-
ation in the central nervous system, produces a progressive deterioration of health
and quality of life. It represents a minimal disease burden at the population level,
mainly due to premature death. In Chile, it is estimated that 385 patients are treated
for multiple sclerosis each year. The package of guaranteed interventions includes
diagnostic confi rmation within 60 days; confi rmed cases must receive treatment
within 30 days. Treatment includes pharmacological therapy and p hysiotherapy.

3.9.3 Discussion Questions

1. What are some of the ethical, scientifi c, and social considerations that should be
weighed in deciding if interventions for both cataract and multiple sclerosis
should be covered by the System of Guarantees in Health?

2. Is there an obligation for health systems to cover all health problems affecting a
population? Are there limits?

3. How should health problems be prioritized and who should have the authority to
make these decisions? Which criteria should receive the most weight in ranking
priorities?

4. How should resources be distributed among health conditions affecting many
people versus health conditions affecting few people?

5. How should resources be distributed among procedures that are preventive ver-
sus treatments for existing conditions?

6. How does taking a public health perspective versus a clinical medicine perspec-
tive affect your thinking about including these two conditions in the System of
Guarantees in Health?

7. What role should transparency play in the selection procedure?

References

Burrows, J. 2008. Inequalities and healthcare reform in Chile: Equity of what? Journal of Medical
Ethics 34: e13.

Ministerio de Salud. 2004. Establece un Régimen General de Garantías en Salud. Ley No. 19.966.
http://www.leychile.cl/Navegar?idNorma=229834 . Accessed 8 June 2015.

Ministerio de Salud. 2007. Estudio Carga Enfermedad y Carga Atribuible. http://epi.minsal.cl/epi/
html/invest/cargaenf2008/Informe%20fi nal%20carga_Enf_2007 . Accessed 27 June 2013.

3 Resource Allocation and Priority Setting

http://www.leychile.cl/Navegar?idNorma=229834

http://epi.minsal.cl/epi/html/invest/cargaenf2008/Informe final carga_Enf_2007

Ministerio de Salud. 2013. Decreto Supremo No. 4. Aprueba Garantías Explícitas en Salud del
Régimen General de Garantías en Salud. http://web.minsal.cl/portal/url/item/d6924d33612dd
5e6e040010164015e8f . Accessed 8 June 2015.

Missoni, E., and G. Solimano. 2010. Towards universal health coverage: The Chilean experience ,
Background paper, no. 4. Geneva: World Health Organization. http://www.who.int/healthsys-
tems/topics/fi nancing/healthreport/4Chile . Accessed 27 June 2013.

3.10 Case 6: Critical Care Triage in Pandemics

Maxwell J. Smith
Dalla Lana School of Public Health and the Joint Centre for Bioethics
University of Toronto
Toronto , ON , Canada
e-mail: max.smith@utoronto.ca

A. M. Viens
Centre for Health, Ethics and Law, Southampton Law School
University of Southampton
Southampton , UK

This case is presented for instructional purposes only. The ideas and opinions
expressed are the authors’ own. The case is not meant to refl ect the offi cial position,
views, or policies of the editors, the editors’ host institutions, or the authors’ host
institutions.

3.10.1 Back ground

Infectious diseases such as pandemic infl uenza and severe acute respiratory syn-
drome (SARS) have attuned the attention of policy makers and health practitioners
to the importance of protecting and promoting the public’s health in the face of
increased care needs and extreme resource scarcity. In particular, acute care needs
for the critically ill and discussions of treatment priorities have been the subject of
much debate in pandemic planning (Hick et al. 2007 ; Melnychuk and Kenny 2006 ;
Uscher-Pines et al. 2006 ). This is not surprising, as it has been estimated that more
than 700,000 Americans may require mechanical ventilation during a pandemic, far
outnumbering available ventilators (Rubinson et al. 2010 ; U.S. Department of
Health and Human Services 2005 ). Additionally, shortages of hospital beds, person-
nel, and other equipment can be expected during a pandemic, which may limit the
ability to meet an expected increase in patient volu me (World Health Organization
2008 ).

Prudentially planning for the public’s increased care needs during a pandemic
requires assessing surge capacity, especially in critical care units (CCU). However,
as pandemics increase in severity, they can overwhelm critical care capacity and

N. Daniels

http://web.minsal.cl/portal/url/item/d6924d33612dd5e6e040010164015e8f

http://www.who.int/healthsystems/topics/financing/healthreport/4Chile

contingency arrangements. To make the best use of resources and personnel (even
in the absence of a pandemic), patients are triaged—evaluated to determine the type
and priority of care to be received. While medical information informs the develop-
ment of triage criteria, ethical considerations about triage goals—whether explicit
or implicit—also play a role. For public health emergencies that overwhelm capac-
ity, some propose adjusting critical care triage criteria to emphasize certain public
health goals, like saving the most lives possible (Christian et al. 2006 ; Silva et al.
2010 ).

Some contend that utilitarian reasoning should predominate in critical care tri-
age, based on the intuition that, when resources are scarce, allocation decisions
should produce the greatest good for the greatest number (Charlesworth 1993 ;
Childress 2004 ). Critics of utilitariani sm reply that it requires coercion or covert-
ness to succeed, because the public will not voluntarily sacrifi ce their lives or their
loved ones for the greater good (Baker and Strosberg 1992 ). Utilitarian triage may
be unpalatable to the public on the further ground that it quantifi es and judges the
value of one life over another, which could disproportionally impact particular pop-
ulation groups (Hoffman 2009 ). Others therefore would base triage decisions on
egalitarian considerations, for instance, by giving everyone an equal chance at
obtaining a scarce good, an approach for which historical precedent exists (Baker
and Strosberg 1992 ).

Whatever approach is adopted, prior arrangements between policy makers, prac-
titioners, and the public based on thoughtful, transparent deliberation about the
most ethical approach to CCU triage usually will improve the legitimacy of d eci-
sions. Those who promote an approach based on fairness and equity need to con-
sider that, during public health emergencies, the goal of saving lives may force a
retreat to utilitarian ethics (Kirkwood 2010 ; Veatch 2005 ). While not necessarily
unethical in itself, a retreat that overturns prior arrangements lays itself open to
charges of illegitimacy.

Variability in the frameworks used to allocate public health resources illustrates
the importance of refl ecting upon the value s that undergird policy decisions and
individual practices, like critical care triage. Appealing spontaneously in the heat of
the moment to values that have not been adequately refl ected upon or discussed in a
transparent and deliberative manner may lead to undesirable outcomes and accusa-
tions of unethical practices. While discussions of CCU triage criteria ultimately
concern institutional clinical policy and practice, they refl ect a larger discussion
about the overarching public health goals in the face of large-scale, widespread
public health emergencies, like pandemics.

3.10.2 Case Description

An outbreak of a novel infl uenza virus has progressed to the point that the World
Health Organization has declared a pandemic. In the pandemic’s fi rst wave, hospital
capacities were suffi cient to handle the infl ux of pandemic infl uenza patients, whose

3 Resource Allocation and Priority Setting

morbidity and mortality rates mirrored rates for seasonal infl uenza. However,
despite a vaccination campaign and other measures, such as ensuring surge capac-
ity, rates of morbidity and mortality associated with the virus have increased drasti-
cally during the pandemic’s second wave.

The resulting increased number of patients needing hospital beds has over-
whelmed even the surge capacity of the CCUs of a metropolitan city’s tertiary care
hospitals. To meet this challenge, a teleconference has been scheduled between sev-
eral members of the hospitals’ administration, the CCU directors from each hospi-
tal, and public health offi cials involved in leading the jurisdiction’s pandemic
response. As a public health offi cial who played a central role in developing the
pandemic plan for your jurisdiction, you have been included on the call to provide
guidance for the pandemic response.

During the meeting, a number of CCU directors report that their physicians and
nurses are concerned about the type of patients bein g admitted into the CCU. Some
of the directors see a trend that they suggest is ultimately undermining the effi ciency
of the pandemic response. They argue that, as the severity of the pandemic contin-
ues to increase, their triage criteria should be modifi ed so as to use CCU resources
to save the most lives possible. They worry that admitting those who present with
the most need is preventing treatment of those who will benefi t most from CCU
admission. “So long as our triage scheme saves the most lives, it is ethically justifi –
able” a number of them declare.

The group takes up the proposal of a CCU director to triage according to
Sequential Organ Failure Assessment (SOFA) scores—which are derived using a
tool that determines a patient’s organ function and failure rate to predict outcomes
(Vincent et al. 2000 ). Were the pandemic’s severity to increase, the group suggests
that, in addition to the CCU director’s proposal to use SOFA criteria, even more
inclusion, exclusion, and priority criteria could be added with the goal of saving as
many lives as possible. They’ve proposed exclusion criteria for CCU admittance
that include patients with a poor prognosis, patients with other known health issues,
and some mention of age cut-offs, to name a few.

Others involved in the teleconference question whether this is the right approach
to take. They argue that, by aiming to save the most lives possible, those who may
benefi t less from CCU admission, like older adults or individuals with disabilities,
will be unfairly affected. They say, “we should not just aim to save lives, but rather
save lives fairly .” As you and your public health colleagues are leading the pan-
demic response, the hospital administrators and CCU di rectors look to you for a
recommendation or decision about how to proceed.

3.10.3 Discussion Questions

1. Ensuring that the CCU has surge capacity is a common strategy to accommodate
an infl ux of patients who have been infected with pandemic infl uenza.

N. Daniels

(a) Does surge capability require alternative critical care triage criteria?
(b) If the population’s health needs exceed contingency arrangements, should

alternative critical care triage criteria be used?
(c) How should these decisions be made?
(d) What principles, value s, or processes should infl uence these decisions?

2. What considerations might exist during a pandemic that do not exist in everyday
critical care and critical care triage that do or do not support the modifi cation of
triage criteria? If pandemic critical care triage requires a unique conceptual
framework, what principles ought to be valued in such a framework (e.g. need,
equality, utility, effi ciency)?

3. Would the severity of a pandemic ever warrant the use of a utilitarian scheme for
critical care triage, given that the public generally fi nds it unpalatable and carry-
ing out such a plan could require coercion? How could an adverse public reac-
tion to coercive or covert measures be mitigated?

4. In a pandemic, the most seriously ill patients with the lowest probability of being
saved might be left untreated because their care would require too many resources
with little prospect of recovery. This illustrates a confl ict between the common
good and the best interests of individual patients. What other confl icts might
arise when triaging in a pandemic?

5. Triage can be used to maximize the number of lives saved with available
resources. Should we aim to maximize the number of lives or, alternatively, the
number of life years saved? This can also give rise to questions about the quality
of those lives and years lived. Is it ever appropriate to make allocation decisions
based on quality of life or life years?

Acknowledgements MJS is supported by a Canadian Institutes of Health Research Frederick
Banting and Charles Best Canada Graduate Scholarship and the Canadian Institutes of Health
Research Douglas Kinsella Doctoral Award for Research in Bioethics. AMV is supported by the
Faculty of Medicine, Ruhr-University Bochum.

Open Access This chapter is distributed under the terms of the Creative Commons Attribution-
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noncommercial use, distribution, and reproduction in any medium, provided the original author(s)
and source are credited.
The images or other third party material in this chapter are included in the work’s Creative
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in the work’s Creative Commons license and the respective action is not permitted by statutory
regulation, users will need to obtain permission from the license holder to duplicate, adapt or
reproduce the material.

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3 Resource Allocation and Priority Setting

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N. Daniels

http://journalofethics.ama-assn.org/2004/05/ccas2-0405.html

http://www.flu.gov/planning-preparedness/federal/hhspandemicinfluenzaplan

http://www.who.int/csr/resources/publications/cds_flu_ethics_5web

Chapter 3: Resource Allocation and Priority Setting

3.1 Resource Allocation in Public Health

3.2 Collective Lessons from the Cases

3.3 Specific Ethical Issues in Resource Allocation

3.4 Decision-Making Process

References

3.5 Case 1: Priority Setting and Crisis of Public Hospitals in Colombia

3.5.1 Background

3.5.2 Case Description

3.5.3 Discussion Questions

References

3.6 Case 2: Intersection of Public Health and Mental Health: Meeting Family Needs

3.6.1 Background

3.6.2 Case Description

3.6.3 Discussion Questions

References

3.7 Case 3: Public-Private Partnerships: Role of Corporate Sponsorship in Public Health

3.7.1 Background

3.7.2 Case Description

3.7.3 Discussion Questions

References

3.8 Case 4: Black-White Infant Mortality: Disparities, Priorities, and Social Justice

3.8.1 Background

3.8.2 Case Description

3.8.3 Discussion Questions

References

3.9 Case 5: Priority Setting in Health Care: Ethical Issues

3.9.1 Background

3.9.2 Case Description

3.9.3 Discussion Questions

References

3.10 Case 6: Critical Care Triage in Pandemics

3.10.1 Background

3.10.2 Case Description

3.10.3 Discussion Questions

References

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