How to Determine Allocative Value in Healthcare

Allocative Value in Healthcare: determined by how assets are allocated to services for different purposes.

Allocative Efficiency

Allocative value, or allocative efficiency as it is also known, has until recently being largely ignored in healthcare in part because of the dominant part that the United States plays in thinking and writing about healthcare. Allocative value requires a consideration not only of institutional quality but also of the impact that a healthcare service has on the population. There has recently been good work through the Choosing Wisely Campaign but the main aim is to reduce costs, not to help decision making for a whole population. Allocative value is a hot topic when needing to make a finite sum cover a whole population.

There are three levels of decision making needed to increase Allocative value in healthcare once the decision on how much to top slice for research and education and the decision on geographical resource allocation has been made.  These three levels of allocative decision making are:

  • Between programs, for example between cancer and mental health or vice versa
  • Within program between system, for example between asthma, COPD, sleep apnoea and breathlessness within the respiratory program and
  • Within system, for example within the resources available for COPD