Public health and health improvement: return on investment. BHF Sustaining Hearty Lives - Workshop , London. 5th October 2011 Professor Mike Kelly Director of the Centre for Public Health Excellence The National Institute for Health and Clinical Excellence (NICE) promotion of good health and the prevention and treatment of ill health. Audiences for public health guidance Local government The workplace Education The utilities Industry Retailers DH and other government departments The public National policy makers The pillars of our work Methodological principles governing all NICE’s work Base recommendations on the best available evidence. To determine cost effectiveness using the QALY. To be clear about scientific and other values To allow contestability. To be seen to be and to be independent of government, the pharmaceutical industry and other vested interests. NICE methods for public health The NICE public health guidance development process An overview for stakeholders, including public health practitioners, policy makers and the public NICE’s current economic approach
• NICE uses a standard set of methods to assess cost-
• The main method, cost utility analysis, considers the
quality of life someone will experience as well as the extra life they will gain, as a result of intervening in a particular way.
• For public health interventions, the perspective adopted
is usually that of the NHS or public sector.
• The costs of lost production due to illness or incapacity
• The time horizon is chosen to ensure all important costs
and effects are captured, in most cases a lifetime horizon. An annual discount rate of 3.5% is applied to the costs and benefits.
• Sensitivity analyses are undertaken to handle
• In general, interventions costing less than £20,000 per
QALY are considered by NICE to be cost effective.
• Interventions costing between £20,000 to £30,000 per
QALY may be considered cost effective if certain conditions are satisfied.
• NICE does not usually recommend an intervention if it
costs more than £30,000 per QALY (other than for certain end of life treatments) unless a strong case can be made that it is an effective use of NHS resources. Assessing Cost Effectiveness estimates included Comparator Guidance topic classification cost/QALY (min–max) PH1 Brief interventions and referral for smoking cessation Brief intervention only (5 £577 to £1 Background quit rate minutes) Brief intervention (5 minutes Background quit rate plus nicotine replacement £1664 to therapy [NRT]) Brief intervention (5 minutes Background quit rate plus self-help) £370 £292 to £847 PH2 Four commonly used methods to increase physical activity Interview Exercise prescriptions £20 to £159 Interviews with exercise Intensive interviews Exercise prescription and exercise information Exercise prescription with intensive GP training Intensive interviews with exercise voucher PH10 Smoking cessation services Background quit rate Brief advice Dominates Background quit rate Nicotine patch – pharmacy consultation Dominates Background quit rate Nicotine patch – pharmacy consultation + behavioural programme Dominates Brief advice plus self-help material Background quit rate Dominates Background quit rate Brief advice plus self-help material plus NRT Brief advice plus self-help material plus Background quit rate NRT plus specialist clinic Dominates Less intensive counselling and Background quit rate bupropion Dominates More intensive counselling and Background quit rate bupropion Dominates Nicotine patch - group counselling Background quit rate Dominates Nicotine patch - individual counselling Background quit rate Dominates Nicotine patch – no counselling Background quit rate Dominates Return on investment
• Resource allocation at local level. • Short, medium and long term returns. • Financial returns and health gains. Aim of the cost impact project
To develop NICE’s approaches to cost effectiveness and
cost impact to better inform local decisions about disinvestment and support the business case for investment in public health.
• Stage 1: to examine current practice and explore and
test methods for assessing the cost effectiveness and cost impact of public health interventions
Three types of approach
• 1. Cost consequence analysis (CCA) describes the
costs of alternative interventions and lists all the health and non-health impacts (benefits) of the interventions. It does not attempt to summarise outcomes in a single measure (like the quality-adjusted life year) or in money terms. Instead, outcomes are listed in their natural units (some of which may be monetary) and it is left to decision-makers to determine whether, overall, the intervention is worth carrying out.
• 2. Cost–benefit analysis (CBA) compares the costs
and benefits of an intervention to assess whether it is worth doing. Both are measured using the same monetary units (for example, £s) to see whether benefits exceed costs.
• 3. Cost–utility analysis (CUA) compares the costs and
benefits of an intervention to assess whether it is worth doing. The benefits are assessed in terms of quality of life as well as quantity of life and expressed as quality-adjusted life-years (QALYs).
Workshops with commissioners and local decision makers
Analysis of current approach to Cost effectiveness and cost impact.
Review of existing Return on Investment methods and tools
Interviews with commissioners and decision-makers
Key Findings: ROIs ROI review • Cost effectiveness analysis and cost consequence
analysis dominate the published literature, cost utility analysis accounts for about 27%
Testing ROI methods • 22 different metrics calculated for 10 PH interventions.
Different metrics produce different rankings resulting in different decisions.
• Overlap between metrics that produce differences and
information required by decision makers for investment decisions: e.g. affordability, reach, avoided burden of disease, short run cost savings, productivity gains
• Undertake CCA to capture all the health and non-health benefits
and costs of public health interventions and report them in a disaggregated way [that makes most sense for each sector]
• Undertake CBA to capture the wider costs and non-health benefits
of public health interventions and to allow multiple outcomes to be compared in a single metric, money
• Support the assessment of ROIs in the short, medium and long
• Continue to undertake CUA of public health interventions using the
QALY to ensure baseline comparability across the UK healthcare sector and across NICE programmes (i.e. technology appraisals and clinical guidelines)
July 2011 New Referral
• To develop a prototype model for local authority
commissioners showing the potential return on investment (ROI) for health improvement interventions.
• Initially the work will focus on tobacco control.
• Review existing models and costing tools to
• Identify up to date data sources to populate the model • Develop scenario analyses around different intervention
• Report health and non-health outcomes and costs in
• Report ROI for short, medium and long term time
KELLY, M.P. (2009) The individual and the social level in public health, in Killoran, A. & Kelly, M.P. (eds), Evidence Based Public Health: Effectiveness and Efficiency, Oxford : Oxford University Press. SWANN, C., OWEN, L.,CARMONA, C., KELLY, M.P., WOHLGEMUTH, C., HUNTLEY,J. (2009) A nudge in the right direction: developing guidance on changing behaviour, in Killoran, A. & Kelly, M.P. (eds), Evidence Based Public Health: Effectiveness and Efficiency, Oxford : Oxford University Press. BAXTER, S. KILLORAN, A., KELLY, M.P., GOYDER. E. (2010) Synthesising diverse evidence: the use of primary qualitative data analysis methods and logic models in public health reviews. Public Health 124: 99-106 KELLY, M.P. (2010) The axes of social differentiation and the evidence base on health equity. Journal of the Royal Society of Medicine, 103: 266-72, DOI .1258/jrsm.2010.100005 KELLY, M.P. (2010) A theoretical model of assets: the link between biology and the social structure. In Morgan, A. Davies, M ., Ziglio, E. (eds) Health Assets in a Global Context: Theory, Methods, Action, , New York: Springer. KELLY, M.P., MORGAN, A., ELLIS, S., YOUNGER, T., HUNTLEY, J., SWANN, C. (2010) Evidence based public health: A review of the experience of the National Institute of Health and Clinical Excellence (NICE) of developing public health guidance in England , Social Science and Medicine, 71 :1056 - 1062 OWEN, L., MORGAN, A., FISCHER, A., ELLIS, S., HOY, A., KELLY, M.P. (2011) The cost effectiveness of public health interventions, Journal of Public Health , in press
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ADVERSE REACTION NEWSLETTER 1999:2 This newsletter contains information reported toinformation reported does not necessarily reflectthe official views, decisions or policies of theInternational Drug Monitoring; however, the NATIONALLY CIRCULATED mainly associated with the dihydropyridine calcium channelblockers (CCBs) INFORMATION Brunet L, Miranda J, Farré M, Berini L, Mendieta C. G
Public health and health 
promotion of good health and the 
Audiences for public health 
The pillars of our work
Methodological principles governing 
NICE methods for public health
NICE’s current economic approach
• For public health interventions, the perspective adopted
is usually that of the NHS or public sector.
• The costs of lost production due to illness or incapacity
• The time horizon is chosen to ensure all important costs
and effects are captured, in most cases a lifetime horizon. An annual discount rate of 3.5% is applied to the costs and benefits.
• Sensitivity analyses are undertaken to handle
• In general, interventions costing less than £20,000 per
QALY are considered by NICE to be cost effective.
• Interventions costing between £20,000 to £30,000 per
QALY may be considered cost effective if certain conditions are satisfied.
• NICE does not usually recommend an intervention if it
costs more than £30,000 per QALY (other than for certain end of life treatments) unless a strong case can be made that it is an effective use of NHS resources.
Assessing Cost Effectiveness
estimates 
PH10 Smoking cessation 
Return on investment
Aim of the cost impact project
• Stage 1: to examine current practice and explore and
test methods for assessing the cost effectiveness and cost impact of public health interventions
Three types of approach
• 2. Cost–benefit analysis (CBA) compares the costs 
• 3. Cost–utility analysis (CUA) compares the costs and 
Workshops with commissioners and local decision makers
Analysis of current approach to Cost effectiveness and cost impact.
Review of existing Return on Investment methods and tools
Interviews with commissioners and decision-makers
Key Findings: ROIs
• Undertake CCA to capture all the health and non-health benefits
and costs of public health interventions and report them in a disaggregated way [that makes most sense for each sector]
• Undertake CBA to capture the wider costs and non-health benefits
of public health interventions and to allow multiple outcomes to be compared in a single metric, money
• Support the assessment of ROIs in the short, medium and long
• Continue to undertake CUA of public health interventions using the
QALY to ensure baseline comparability across the UK healthcare sector and across NICE programmes (i.e. technology appraisals and clinical guidelines)
July 2011 New Referral
• Review existing models and costing tools to
• Identify up to date data sources to populate the model • Develop scenario analyses around different intervention
• Report health and non-health outcomes and costs in
• Report ROI for short, medium and long term time
KELLY, M.P. (2009) The individual and the social level in public health, in Killoran, A. & Kelly, M.P. (eds), Evidence