Health Economics and Indigenous Health: measuring value beyond health outcomes

Australia has decades of public policy experience attempting to overcome the disparities in health outcomes facing Aboriginal and Torres Strait Islander (Indigenous) Australians. Significant resources have accompanied these policy initiatives, however, Indigenous Australians continue to bear a heavier burden of death, disease, disability and economic hardship than other Australians. Despite the policy experience of Australia and widespread support for initiatives to overcome Indigenous disadvantage, there is little consensus on the best means to actually do so. Working to ensure that available resources are used in their most effective way possible is vital to improving the health of Australia’s Indigenous populations. At its broadest level, health economics is the study of the choices made in the allocation of scarce resources to improve the health status of populations and service delivery. Notwithstanding the political, moral and economic importance of the issue, there remains limited health economic research in the field of Indigenous health nor is there a developed evidence base to provide guidance to policy‐makers looking to invest in cost‐effective interventions. Further, health economic methods have been criticised as potentially inappropriate for the area of Indigenous health. Current methods for economic evaluation tend to adopt a reductionist approach based on a cost per health outcome paradigm and are potentially insensitive to the outcomes and processes that Indigenous people see to be of value to their health and health care on three broad and related levels. First, Indigenous conceptions of health have been shown to differ from the biomedical notions which tend to Health Economics and Indigenous Health 13 underlie the reductionist approach of health economic evaluations. Second, a central tenet of Indigenous health care is community ownership and control of healthcare services. As such there is value associated with how well services achieve engagement with communities which may also be missed through a reductionist health economic approach. Third, social determinants of health have also been demonstrated to be particularly important to the health outcomes of Indigenous Australians but again have tended to lie outside the domain of traditional economic evaluation methods. Potentially because of these and other difficulties, resource allocation decisions in the field of Indigenous health have been made without a strong economic evidence‐base and have instead seemingly relied on rights‐based arguments promoting investment based on the sizeable need that these communities face. While there is no denying the stark disadvantage facing Australia’s Indigenous populations, such rights‐based arguments provide little guidance on how much to invest or on trade‐offs between different policy options or individual service components. Further, the weight attributed to such arguments has tended to vary according to the prevailing political climate. Health economic approaches on the other hand, can provide evidence based on value that can transcend politics and lay the foundation for rational priority‐setting that maximises the health of target populations. Ignoring the realities of resource scarcity in the sector will not allow policy interventions to maximise the health outcomes for Australia’s Indigenous communities. Health economic methods such as discrete choice experiments (DCEs) and contingent valuation studies have been used to value factors outside of traditional economic evaluations in other fields yet have been largely untested in Australian Indigenous populations. Such 14 Health Economics and Indigenous Health techniques potentially represent a direct means through which to incorporate Indigenous values and preferences into the evaluation and design of health programs and ultimately a mechanism for the sector to demonstrate the value and impact that properly designed services can have. There is limited empirical understanding of the role of culturally‐specific healthcare providers in terms of the service use patterns of these communities and overcoming the barriers that face Indigenous Australians attempting to access health services. Examining these issues through an economic lens is likely to provide a level of guidance to policy‐makers that is currently absent from Indigenous health policy in Australia. This thesis explores these issues through a mixed‐methods approach investigating the application and merits of a variety of health economic methods in these populations. Chapter 1 introduces the major issues in the field and provides an overview of the published literature carried out to date. Chapter 2 presents a more detailed investigation of the economic evaluation literature with a systematic review of published economic evaluations investigating health interventions in Indigenous populations around the world. The review finds relatively limited economic evaluation of health care interventions for Indigenous populations in Australia or globally, however, what has been done has demonstrated the potential for cost‐effective interventions in these populations. Almost no consideration of alternative conceptions of health or Indigenous‐specific values were found through the review. Chapter 3 examines this issue further, investigating the use of health‐related quality of life (HRQoL) instruments in these populations, one of the most direct method to incorporate Indigenous conceptions of health into evaluations of health programs, through a systematic review of the use of these instruments in Indigenous populations around the world. The review found that while HRQoL instruments have been used to elicit the quality of Health Economics and Indigenous Health 15 life of Indigenous populations their use was relatively limited, as was evidence of the validation of these instruments in these population groups. The evidence that does exist suggests that some Indigenous populations potentially conceptualise these issues fundamentally differently to populations in which these tools have been designed and validated. Chapter 4 discusses the findings of the reviews presented in Chapters 2 and 3 in light of the Australian policy context. The chapter argues that the policy environment has emphasised rights‐based rather than economic arguments in resource allocation decisions that has left room for efficiency and equity improvements in the way that resource allocation decisions are made in the field of Indigenous health. Given this, the chapter calls for further work to investigate the service utilisation of Indigenous populations and the role of culturally‐ specific healthcare providers and incorporate Indigenous values to value programs to improve Indigenous health including through contingent valuation and discrete choice experiment methodologies. Chapter 5 takes up the first of these issues with an analysis of the healthcare expenditure of a cohort of Indigenous and non‐Indigenous Australians at high‐risk of cardiovascular disease to investigate the relative service utilisation of the two groups. The analysis finds that when individuals are engaged with care providers, culturally‐specific providers were providing equivalent care to mainstream providers in non‐remote areas and factors other than patient Aboriginality seem to be more important in determining the healthcare expenditure of these high‐risk patients. The chapter also highlights problems with current data collections in the field that acts to obscure analysis of service utilisation patterns of Indigenous Australians, particularly in remote areas, and comparisons between the relative service use of Indigenous and non‐Indigenous Australians. Chapter 6 further investigates the role of culturally‐specific 16 Health Economics and Indigenous Health service providers through a DCE attempting to value the cultural component of a fall‐ prevention service. The chapter presents the findings of a DCE carried out in a cohort of older Aboriginal people receiving a culturally‐specific fall‐prevention intervention. The chapter demonstrates that DCEs provide a potential means to incorporate the preferences of Indigenous communities into the design and evaluation of health services. A value for the cultural component of the service was derived through the DCE and the relative importance of different barriers to care to the decision‐making of the participants were investigated. Chapter 7 presents the findings of a contingent valuation study investigating the value that the Australian community places on holding a driver licence as an example of a social determinant that has been shown to be associated with positive health outcomes in Indigenous populations. The analysis finds contingent valuation techniques can provide a means to value social determinants of health that lie outside traditional health economic evaluations and to value broader policy interventions to improve living standards. Chapter 8 puts forward the main findings of this thesis arguing that the health economics field has an important role to play in improving the health of Australia’s Indigenous populations. Appropriate targeting of available resources is essential to close the gap in health outcomes between Indigenous and non‐Indigenous Australians. Economic research is vital to build an evidence‐base for policy makers looking to invest in cost‐effective policy options and this needs to be based on factors that Indigenous communities consider important to their health and healthcare. Potential for economic evaluation of programs needs to be a key consideration in resource allocation decisions in the field. These need to be robust enough to incorporate the factors that are important to Indigenous Australians. The role of culturally‐specific providers needs to be better understood Health Economics and Indigenous Health 17 as do the different components that make up such a service. Finally, incorporating