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Disability-Adjusted Life Year as a Guide for Health Policy Author(s): V. N. Kothari and I. S.

Gulati Source: Economic and Political Weekly, Vol. 32, No. 41 (Oct. 11-17, 1997), pp. 2612-2617 Published by: Economic and Political Weekly Stable URL: http://www.jstor.org/stable/4405951 . Accessed: 17/12/2013 10:12
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Life Year as a Guide Disability-Adjusted for Health

Policy

V N Kothari I S Gulati The question of efficiency in public health expenditlre is lately attracting considerable attention at the hands of health econcmists. The World Bank's World Development Report, 1993 advocates measuring the burden of This paper discusses the limitations of the concept disease in units known as disability-adjusted life years (DALYs).and tries to bring out the implications of adopting DALYas a policy guide in the pursuit of health care objectives, particularly in a developing country such as India.
considerableattentionat the handsof health economists. Interestingly,the thinking on the subject of efficient public health expenditureis not confined to developing specific measures and criteria of costeffectiveness, encompassing various types as one would do of healthcareor treatment, whenaddressing thequestionof, say,efficient defence expenditure. This type of effectiveness will probably be termed by AlanWilliams( 1988)as technicalefficiency, or, as he puts it, "amatterof becomingmore efficient in the low-level sense of getting on to theproduction Recent possibilityfrontier". discussions on efficiency in public health spending have extended to the matter of "high-levelefficiency problemof choosing where to be on the productionpossibility" frontier,that is, to the question of the mix of activitiesto select fromthose thatareopen to us. To Alan Williams, "this is a matter of allocativeefficiency rather thantechnical efficiency", because thereby one chooses between one set of patientsfor treatment as against others on the basis of a criterionor inthesenseofoptimising criteriaofefficiency social benefit. Thus the choice of the point on the fromthepoint production possibilityfrontier, of view of allocative efficiency of public health spending, depends critically on the criteria one adopts to measure the social benefit of medical treatmentor health care that would accruefrom treatingone patient ratherthan another. In recent discussions, I the one criterionthat has been most widely Concept of DALY discussed is thatof life yearsa patientgains While efficiency in spending is a matter frommedicaltreatment. of life Morenumber of majorconcern in all spending,privateor years gained the betterit is for social good. so in the context of Obviously, the underlyingassumptionhere public, it is particularly publicspending.Unlikein thecase of private is that a patientgaining a largernumberof spending, the yardstick of utility maxi- life years will contributemore to the social misation is not available for most public output. For forming a judgment about the spending, especially that part of public we need spending which addresses merit wants that effectivenessof healthinterventions, the society decides to meet regardlessof a a unitof measurement of thehealthoutcomes. citizen's ability and willingness to pay for There are many diseases. They may strike them. Health care is one such area. at differentages. They may be also gender In the specific context of providingpublic specific. They may be prevalent among health care, the question of efficiency in differentsections of society. Diseases may publichealthexpenditureis lately attracting cause death or disability. Certain diseases 2612 WE start with a general discussion of the atensuringefficiencyin public recentattempt spendingon healththroughan adjustedlifeyears-gained approach. This is a method under which the efficiency of medical intervention is judged by the gain made through medical treatmentof ailments in terms of the adjusted life-years-gainedfor the patients treated. On the question of to the life-yearsgained,thereare adjustment two major strands of thought, one which advocates adjustmenton the basis of the qualityof the life yearsgained and the other which advocates adjustment in terms of disability that survives in spite of medical treatment.The first school of thought uses a method of adjustmentcalled QALY and the second school's method of adjustment is called DALY. This latterconcept has the stamp of approvalof the World Bank and, as a consequence, has emerged as an when it important policy-makinginstrument comes to allocation of health spending. In this paperwe concentrateon the latterand on its implications for health policy. The paperis divided into three parts.In the first section, we explain the concept of DALY. The next section discusses the limitationsof the concept. The thirdsection commentsin some detail on the implicationsof adopting DALY as a policy guide in pursuit of a country'shealthcareobjectives,particularly wherethecountryhappensto be a developing one, as for example, India. may be treatedwith moderateexpenditure. of othersmaybe highlyexpensive. Treatment Since expenditure on health and medical facilities has a common monetary unit of measurement,it seems reasonableto strive to discover a common unit of measurement of benefits accruing from the provision of health and medical facilities. One such measure is death rate or mortality rate. Statistics relating to death rate are readily available and easily understood and interpreted.Efficiency of the public health and medical services can be judged in terms of theirimpacton mortalityrates.However, those who have suggested the evaluationof healthspendingin termsof life yearsgained reject the indicator of mortality rate as inadequate.According to the World Bank, "any discussion of health policy must start with a sense of the scale of healthproblems. These problemsare often assessed in terms of mortality, butthatindicator failsto account for the losses that occur this side of death becauseof handicap,painorotherdisability" [World Bank 1993:25]. World Bank (1993) advocates measuring the burden of disease in units known as DALYs. DALY combines losses from prematuredeath and loss of healthy life resulting from disability. It is defined as "a unitusedformeasuring boththeglobalburden of disease and the effectiveness of health interventions,as indicatedby reductionsin the disease burden. It is calculated as the presentvalueof the futureyearsof disabilityfree life that are lost as the result of the premature deaths or cases of disability Thecalculation a particular year". occurringin involves estimationof potentialyearsof life lost, relativevalue of healthylife at different ages, the discount rate to make futurelifeyears comparable with present and the disability weights to convert life lived with disability to a comparable measure with prematuredeath. The number of years of death is potential life lost due to premature calculatedas the differencebetweenthe age at death and the expectation of life at that age in a low mortalitypopulation.The value of a year of life lived by a younger person is greaterthanthe valueof a yearof life lived October 11, 1997

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by an old person.So early yearsof life carry greaterweights [World Bank 1993:26 and 131.Thus, while the 20th yearhas a weight of 1.4, the 60th year is given a weight of 0.8. However, giving different weights to different ages is not considered crucial. If so desired,a uniformweight of one may be given to each year of life. The Reportdoes use, however,a discountof 3 percent to sum up the loss of healthy years lost at different points in life to find out the present value of future years. The weights assignedto disabilitiesrange from zero in case of perfect health to one in case of death. The weights in the intermediaterange for disabilities short of deathcaused by diseases have been fixed in consultationwith the experts [World Bank 1993:24]. Expenditureon health and medicinemay not only avertdeath but also do so without health causinganydamageto the subsequent condition.In thatcase, full DALY is gained for each of the remaining years of life. If death is avertedbut a permanentdisability is caused, causing impairment of health,for eachof theremaining years,a certainfraction of theDALYis lost,depending on theseverity of the disability. If death occurs, it is equivalentto full DALY lost, for each of the remainingyears. Age weighting:World Bank (1993) takes expectationof life as 80 years for men and 83 years for women. A female death at age 40 representsa streamof lost life equal to 43 years.The relativevalue of a year of life at each age rises fromzero at birthto a peak at age 25 and then declines to zero. The weights are worked out in such a way that the totalnumberof DALYs over the full life arethesameas it wouldbe if uniformweights for each age were used. The value of a life at a particular age is the aggregateof weights ofeachofthe expectedyearsof life.Therefore, as the Reportputs it, "it is important to note thatwhile the firstyearof life receivesa very low weight, the life of a new bornis valued accordingto the weights of all the years he or she is expected to live, that is, according to the sum of the functionover futureyears. In the absenceof discounting,therefore,the loss of DALYsfrompremature death greatest occurs from infant deaths" [World Bank 1993:213]. Time preference: As regards preference for present consumption over future the Reportuses a discountrate consumption, of 3 percent peryear.Once the discountrate is introduced, the point of greatestloss from deathmoves from infantto early premature adolescence. Thusreadingfromthediagram, given on page 25 of the Report, the death of a new born baby girl representsa loss of 32.5 DALYS. Female death at ages 10, 20, 30 and 60 means loss of 37.5, 33, 29 and 12 DALYs respectively.

Disability weighting: disability weights used to measurethe burdenof disease range from zero to one. While zero represents perfect health one represents death. For deciding the disabilityweights World Bank has gone by the determination made by experts. A person may not die but survive with a handicap or disability. Disability weights could be greaterthan zero and less thanone. For example,a womanof 60, who is saved from a fatality through a medical intervention andwholives a perfectlyhealthy life subsequentlygains 12 DALYs. Another women who survives but with a handicap ordisability,theweightof whichis 0.4, gains only 7.2 DALYs. One more point should be noted, which theburden relatesto themethodof computing of disease. As WorldBank (1993:214) puts it, "theburdenof disease could be computed using a prevalence perspective (the extent of burden during a given year, no matter when a disease condition began) or an incidence perspective(the futureburdenof that year's new cases or incident diseases). An incidence perspective was chosen: the burden of disease is the future stream of disabilitycaused by incident cases in 1990. This is the more logical way of dealing with mortality, andit is easy to applyto nonfatal disabilities".To put it in a language familiar to economists, the prevalence perspective measures the stock, while the incidence perspective measures the flow of the burdenof disease. The choice of the latter, as we shall note, has certain implications. II Limitations of the Concept DALY, as a method of measuringhealth outcomes,is supposedto providea common unit of measurement of benefits from expenditureon healthand medicalservices. Given such a common unit of measurement of health outcome, it can be relatedto cost of treatment. It is on the basis of this linkage that World Bank (1993) recommendsthat on healthservicesshould publicexpenditure be concentratedin those directions where, for a given expenditure, the gains in DALYs saved are the highest. This sounds like patterning expenditure on treatment of differentdiseases accordingto the principle of equi-marginalreturns.However, adding up DALYs of differentindividualsinvolves interpersonalcomparison of good, which can raise complex questions. If it is a question of technical efficiency, that is, being inside the production possibility frontier, DALY as a measurement can provide guidancein regardto cuttingdown wasteful on a given treatment. However, expenditure publichealthpolicy involves morethanmere technical efficiency. It involves priority setting.

DILEMMA OFPRIORITY SETTING According to Alan Williams (1988), "priority setting reflects ideology, so we must start by analysing the characteristic ideologies of public and privatehealthcare systems. Both systems (and their respective ideologies) have to face the problemthatthe recent rapidgrowth of effective health care has led us to the point whereno country(not even the richest) can afford to carryout all the potentiallybeneficialprocedures thatare now available on all the people who might possiblybenefitfromthem.So priority setting canno longersimply bea matterofeliminating ineffective activities. It is now more than a matter of becoming more efficient in the low-level sense of gettingintotheproduction possibility frontier.Prioritysetting now has to deal withthemuchmorecontentioushighlevel efficiency problemof choosing where to be on the productionpossibility frontier, thatis, which mix of activitiesto select from those that are open to us. This is a matter of allocativeefficiency ratherthantechnical efficiency, and inevitably contains equity considerations (i e, views as to how the welfareof one pcrsonis to be weighedagainst the welfare of another person)." Amartya Sen vividly brings out the dilemma.As between two individualsof the same age, one of whom is able-bodied :U.-d
another a handicapped person, whose life

should be saved? Saving the life of an ablebodied personwould representa largergain in DALYs because saving the life of a handicappedperson,even if his longevity is the same as that of an able-bodied person in question, represents a fraction of the DALYs gained.A DALY maximisingpolicy at an aggregatelevel would thus be doubly to the handicapped person. disadvantageous According to Sen (1996), "to follow that policy of giving priorityto saving the ablebodied would be to compound the disadvantageof the disabled. The disabled person is alreadyat a disadvantagebecause of her handicapof illness or impairment. On top of that, to make her survival chances worseas a resultof DALY-orientedresource allocationwould be to heapfurther handicap on a person who is already worse off." In this context, it is well to rememberthat in India for instance, 2 per cent of the populationis physicallydisabled.Broome(1993) too makes the same point, though in the contextof QALY,notDALY, whenhe notes: "Inmedicaldecision, benefitis obviously an importantconsideration,but it is often not the only one. Another is fairness. When treatmentis to be given some patients and denied others,to treatthose whose treatment would do the most good is not necessarily the fairest thing to do. Other things being equal,forinstance,treatinga youngerperson is likely to do moregood in totalthantreating

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anolderone, becausetheyoungerhas longer to enjoy the benefits. But if resources are concentratedon the young for this reason, thatmay be unfairto the old. So benefit and fairness may conflict." When DALYs are addedup for the populationas a whole, we arereallymakinginterpersonal comparisons of good which may be highly questionable. Further,there are technical problems in measuringDALYs. Measurementin terms of death and disability is not sensitive to severalotherstatesof healthcondition.Thus, for instance, long-termcare of old people, mentallyretarded people and terminalcases of illness does not show up in the improvementof disability or survival rate but involves providing to the patient autonomy, privacy, dignity, etc. Such is thereforeinherentlybiased measurement againstthe older people (see Donaldson et al 1988,on theadoptionof QALYto measure the the benefitof treatment). Unfortunately, lively debate about the relevanceof QALY to healthpolicy finds no referencein World Bank (1993). To allocatethebenefitof medicaltreatment or healthcareon the basisof life yearsgained would naturallyoperate in favour of those who have more years of life ahead of them except perhaps the very young among them.The aged will stand at a clear disadvantagein such a calculation because of the shorter life expectancy at their age, regardlessof how long and well they may havecontributed to social outputduringtheir working life.
ANDGENDER BIAS CLASS DIMENSION

particularly in societies with inadequate public healthcoverage. The position of not only old men frompoorhouseholdsbut also womenof all ages probablygets aggravated, because even poor households make some sort of calculation in terms of life-yearsgained when it comes to allocating their limited resourcesfor medical treatment.In this private calculation, not only do households take into account the life years people are expected to gain from medical treatmentbut also they make some sort of judgmentaladjustmentfor the contribution of the person treated to family output or income and such calculationsnormallycan be said to go against not only the old and the very young but also against women. It is relevantto note in this context that it is not just the rich or well-to-do households

who makeuse of privatehealthcarefacilities. Close to 40 per cent of ruralhouseholdsand 30per centof urbanhouseholdsin thebottom two daciles make(or aredrivento make)use of privatehospitals in India [Sanyal 1996]. And if the public healthcare systemfollows the principleof gains in DALYs so explicitly as suggested by World Bank (1993), severe on thepart reshufflingof privateexpenditure of the poorer families will cause a further deteriorationin the health status of adult women and older and disabled personsand perhaps even children. Thereis thus inevitablya conflict between efficiency andequity as also betweenability to benefit and intensity of need, which the supplyof a meritgood suchas healthservices encounters [see Wagstaff 1993, for an illuminating discussion].

TABLE I: HEALTH EXPENDITURE ASPERCENTAGE OF GDP, 1990 Demographic Region Sub-SaharaAfrica India China Other Asia and Islands Latin America and the Caribbean Middle EasternCrescent Formerly Socialist Economies of Europe Established MarketEconomies World Note: Public Sector 2.5 1.3 2.1 1.8 2.4 2.4 2.5 5.6 4.9 Private Sector 2.0 4.7 1.4 2.7 1.6 1.7 1.0 3.5 3.2 Total 4.5 6.0 3.5 4.5 4.0 4.1 3.6 9.2 8.0

Health expenditure includes outlays for prevention, promotion, rehabilitation and care; food aid;andemergencyaid specifically activities;programme populationactivities;nutrition for health. It does not include water and sanitation. Source: World Bank (1993), Table A-9, pp 210-11. RATES INRIGHT REGIONS TABLE 2: AGE-SPECIFIC DEATH DEMOGRAPHIC 1990 (PER1,000 PERSONS) Latin Middle Formerly Established World Sub- India China Other AgeAsiaand America Eastern Socialist Market Group Saharan Africa Islands Caribbean Crescent Economies Economies of Europe (EME) 1 0-4 5-14 15-59 60+ Total 2 42 5 8 57 15 3 27 3 5 56 11 4 9 1 3 53 8 5 19 2 4 47 8 6 13 1 4 39 7 7 22 2 3 48 9 8 4 0 4 47 11 9 2 0 2 41 9 10 20 2 4 48 9

The class dimension of this approachto health policy can also be not ruled out on the grounds that the allocation of private healthexpenditureis, in any case, weighted in favourof those with necessaryincomeand wealth. A 60-year-old woman, with means to pay for her treatment,however complex and expensive, shall secure such treatment because she has the ability to pay for it. But whatabouthercounterpart fromthe average andbelow averageincome andwealthgroup is the question. Both have virtually no working life year to look forward to. But while the formercan buywhatevertreatment is considerednecessaryfor her ailment,the lattercannot unless her need is considered a meritwant that public health care facility will attend to.FollowingtheDALYapproach, the destituteold womanwill have to live out herailment.Insocietieswheretheproportion of totalhealthexpenditure incurred privately is high, because this group of people will haveto awaitaccess to medicalcarefacilities on the basis of the calculation of DALYs gained the chances are that this group will go without medical care. In real life, not just old men and women with no, or inadequate, means suffer,

Source: Table A-4 (p 202) of World Bank (1993) gives data about population and numberof deaths by age-group. Death Rates per 1,000 in each age-group have been worked out on the basis of that data.
TABLE 3: PROBABILITY OF DYING DURING 15-59 YEARS (PER CENT) AND LIFE EXPECTANCYAT AGE 15 YEARS, IN EIGHT DEMOGRAPHIC REGIONS, 1950-1990

Demographic Region

Probability of Dying during Age-Group 15-59 Years (Per Cent)_ 1980 1990 1950 47.9 38.5 53.4 45.0 36.6 50.1 22.3 20.7 40.6 36.6 26.3 21.6 24.5 19.1 26.5 20.2 11.4 24.7 34.5 25.0 17.5 21.2 19.1 20.1 19.7 10.7 20.7

Life Expectancy at Age 15 years 1950 43 47 40 44 48 42 54 55 47 1980 48 52 55 51 57 52 58 61 55 1990 50 53 58 54 60 55 59 62 56

Sub-SaharanAfrica India China Other Asia and Islands Latin America and Curibbean Middle EasternCrescent Formerly Socialist Economics of Europe Established MarketEconomics World

Source: World Bank (1993), Tables A-4 and A-5, pp 202-203.

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to save a humanlife. Thatis just impossible. But DALY as an indicator of outcome of Let us howeverevaluateDALY purelyas medical interventions, though seemingly an indicator of efficiency of outcomes of neutral as betweenlife anddeathof particular health service. In the first place, DALYs individuals, can lead to peculiar problems across future expected life are added up. when used as a measure of benefit. A thatDALYs hospitaldirectorwould find that an expenImplicitin thisis the assumption across age are separable. But if there is sive operation successfully carried out, in healthstatusat different though counted as a successful case in interdependence of DALYs medicalterminology, wouldearnthehospital life, a simpleaggregation stages-in different magnitudes of DALYs gained gives a faulty guidance to policy. A furtherproblem relates to the method depending on the age of the patient saved. of computing the burden of disease. As What type of an incentive system for mentioned in the last paragraph of section hospitals,especially those in public sector, I, WorldBank(1993) hastakenthe incidence would come into existence under DALY perspective(the futureburdenof thatyear's norms? To the denial of facilities due to new cases or incident diseases). For economic condition would be added the measuringthe burdenof mortality,it makes possibility of a denial due to age, disability no difference whether one follows the and even gender. The difficulty with DALY is that it is a incidence perspective or the prevalence of non- hybrid of death and disability. It tries to perspective.But in the measurement fatal disabilities, it makes all the difference equate, let us say, five years of healthy life which perspective is adopted. Thus, for with 10yearsof life lived athalfDALYeach. instance,new cases of blindnessdue to small Suchequationignoresthe factthatdeathand pox may be zero but the past accumulated disability are qualitativelydifferent. cases of blindnessdue to small pox may be III quite numerous. So also is the case with Daly and Health Policy anaemia due to iron deficiency or loss of World Bank (1993) proceeds with great limbs due to accidentsor disabilitiesarising fromoccupationaldiseases. Is it reasonable confidence to make definite recomto ignore the stock of disabilities? Since mendationsabout public health policy for DALY is used for policy guidance, the the developing countries. It takes DALYs incidence perspective results in an under- gained as a measureof cost effectiveness of Basedon costperDALY estimationof the burdenof disabilities and healthinterventions. therefore an underestimationof the task gained, it recommends redirecting public before the health policy formulators.Not health and medical expenditureaway from to only that. The magnitudeof the disability tertiaryhospitalsand high cost treatment healthcentresanddistricthospitals. burden on the adults is likely to be primary because disability is likely The Reportrecommendsgreaterdevolution underestimated, healthcentresand to be more severe and more prevalent of publicfundsto primary among adults and elderly. The DALY districthospitals.These should be provided and measurementthrough incidence method is withbetterpersonnel,drugs,equipments as well transport facilities. The Report also thereforeprone to underestimation recommends basedhealthservices as misdirection. population is maximisationof DALYs which are largely preventivein natureor in Furthermore, the nature of control of communicable gained through public health policy interventions an ideal to be pursued diseases. Warningis sounded,interestingly, independently of the composition of against vested interestsof pressurelobbies population? A reduction in death rate at of medical personnel, pharmaceutical whateverage it occurs carriesequal weight companies and organised groups of public in the calculation of the crude death rate. whichmayresultindiversionof publichealth medical Calculation in terms of DALYs however resourcestowardexpensive tertiary carries different weights for reduction in hospitals, costly treatmentsand surgeries healthservicesandpreventive death rate at differentages, as for example while primary a female deathat age 30 means a loss of 29 health measures are starved of essential DALYs, and at age 60 means a loss of 12 resources. The Report mentions six components of DALYs. A reallocation of public health facilitiesin favourof youngerage mayresult public health services. These are: (i) atolderagegroups. immunisation, (ii) school based services, in mortality in anincrease Thus while DALYs may be gained, death (iii) informationand selected services for ratesmayworsenamongtheolderage groups family planning and nutrition, (iv) to reduce tobacco and alcohol and even overall. The maximisation of programmes of household DALYs is thus ex-post and does not refer consumption, (v) improvement to the same population. environment,and (vi) AIDS prevention.As clinicalandcurative medicalservices, It is nobody's contention that the regards is to restrict itselfto providing communityshould spend infinite amounts thegovernment
DA-Y AS EFFICIENCY INDICATOR

essential clinical package consisting of five elements, namely, (i) prenataland delivery care, (ii) family planning services, (iii) tuberculosis of sexually control,(iv) treatment transmitted diseases, and (v) care of serious illness of the young children.Thus, beyond the population-based healthservicesandthe nationallydefinedessentialclinicalpackage, theReportis generally in favourofwithdrawal of the government. At different points, World Bank (1993) repeatedly advocates that government expenditure on tertiary care facilities, specialist training and interventions that providelittle healthgains in termsof DALYs saved per unit of expenditure, should be reducedor eliminated.Indeed,at one point, the Report's recommendation is to "convert some acute care hospital capacity to less costly extended or chronic care facilities for patients who requireless-intensive care for long-term recovery and for rehabilitation of chronic conditions so that over time, the tertiaryhospitals can be operated on self-financing basis, or they can be closed, converted to chronic care facilities or district hospitals if these are needed or even sold to the private sector" [World Bank 1993:137]. In theoretical terms, World Bank (1993) seems to go backto the old classical position regardingthe role of the state in correcting for marketfailuredue to lack of information and prevalence of externalities. Child and careandfamilyplanningconstitute maternal one plankof policy. The otherplankconsists of takingcareof externalitiesassociatedwith immunisation, T B, AIDS, sexually transmitted diseases, environmental improvementand control of communicable diseases.Fortherestof thediseasesinvolving medicaltreatment or surgery,the society has to depend largely on private provision of financedthrough medicalservicespreferably voluntary insurance. WorldBank (1993) recommendations are based on two considerations:(1) high cost of DALYs saved in tertiary hospitalsand(2) the assertion that the benefits of tertiary hospitals are skewed in favour of better-off urban groups. As the Report puts it, "Government spending for health goes to the affluentin the form disproportionately of free or below-cost care in sophisticated public tertiarycare hospitals and subsidies to private and public insurance... In lowincome countries the poor often lose out in healthbecause public spendingin the sector is heavily skewed towardhigh-cost hospital servicesthatdisproportionately benefitbetteroff urban groups" [World Bank 1993:4]. Therefore, the inevitable conclusion is to "reducegovernmentexpenditureon tertiary andinterventions facilities,specialisttraining, thatprovide little gain for the money spent" [World Bank 1993:6].

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involvementin clinical andcurativemedical burden of disability too would increase services as recommendedby World Bank because this is the productive age-group. Interestingly, the Report refrains from (1993). According to the data presentedin Also, deathsanddisabilityin this age-group providingany clue as to the optimumlevel its Tables A-4, B-l and B-5, of 9.3 million would cause distress amongdependentsand of public expenditure on health services. deathsoccurring in Indiain 1990,3.8 million even causedestitution.The DALY approach Shouldpublicprovisioning of healthservices or 41 per cent deaths occurred in the age- of WorldBanktakesno noticeof such consein developingcountriesaim at reachingthe group below 15, as many as 2.3 million or quences on productivityand social distress level thatobtainsin thedevelopedcountries? 25 percentdeathsoccurredin the age-group that will be generatedin case this approach Or could they obtain better results in terms 15-59 and 3.3 million or 35 per cent deaths to health policy is adopted in India. of health status of the community by occurred among 60+ population. If public When we compareage specific deathrates depending much more on private expenditureon curativeandclinical medical (per 1,000 persons in each age-group), we provisioning?Let us turnfor answersto the services were to stop or be severely cur- find thatIndiais only slightly betteroff than tailed, as World Bank would like to see sub-SaharanAfrica and much worse off as ground situation. Table 1 shows health expenditure as happening,mortalityin the adultage-group compared to China and other Asian percentage of GDP in 1990 in eight (15-59 years) would sharply increase. The countries. Table 2 presents data relatingto demographic regions of the world.It will be noticedthatin establishedmarket economies taken together public sector spending on health far exceeds that in any part of the developing world. As against 5.6 per cent of GDP in the former,the proportionin the developing world does not go beyond 2.5 per cent of GDP. It is also noteworthythat though India spends as much as 6 per cent Institute of Social Sciences of its GDP on the health services, only 1.3 NewDelhi percent of GDP is spentby the public sector andthebalance4.7 percentrepresents private InternationalConference spending.On the other hand, out of 3.5 per cent of the GDP spent by China on health on services, 2.1 per cent is spent through the Europe and South Asia: 500 Years public sector and 1.4 per cent throughthe 16 - 20 May 1998 sector. of the out Actually eightmajor private Calicut & Cochin regions, with respect to which the data are presentedin the table, India's public sector Kerala expenditureat 1.3 per cent of the GDP is the lowest. Data relating to utilisation of hospital and3 daysprogramme 16 May willbe heldat Calicut and (Theinauguration beginning facilities in India are available for the year thelasttwodaysprogramme andvaledictory withapublic at Cochin/Ernakulam.) meeting 1986-87, fox the 42nd Round of National SampleSurveyandarepublishedin the 51st The Conferencewill deliberate upon the following areasin symposia issueof Scrvekshana. Outof the 18.6 million and sessions: Cultural cases of hospitalisation in 1986-87, 11.1 Process, Political Economy, Nation and working million or about60 per cent were treatedin in SpouthAsia, Globalisation, Religion, Education, Trade Identity public sector hospitals, that is, in public and Commerce, Contemporary Europe and India. healthcentres.Out of hospitalsand primary The relatedthemes will be discussedin the historicalcontext of the 11.1 million cases treated in public sector million from rural areas. 9.5 came hospitals, relationships between India and European countries - Portugal, The Further,only 1.8 million cases belonged to Netherlands, Denmark, France and Britain. It will be a unique occasion thetop 20 percent of the populationin terms for academics, thinkers, writers and public persons from Europe, India of per capita expenditure [Kothari 1993]. and other countriesto reflectand reviewthe 500 yearsof relations between Thus the sweeping generalisationof World Bank (1993) that public hospital facilities Europe and South Asia beginning 1498. Academics desirous of are mostly utilised by the better-off among participatingin the Conference and presenting papers are requested to the urbanpopulationis not borneout, in the write to the Convenor:Dr. M. R. Raghava School of Social Sciences, of hospital case of Indiaat least. Contraction Varier, facilities is bound to hit the poorersections MahatmaGandhi University, Malloosseri P.O,Kottayam-686041, Kerala more severely. Out of 7.6 million hospitaliOff: 04,81- 597983, Res: 0481 - 580256) or Conference Co(Tel: sation cases from the bottom40 per cent of ordinator,Institute of Social Sciences, B-7/18 SafdarjungEnclave, New the population, as many as 5 million had availed of public hospitals. This may be Delhi 110 029 (Tel: (011) 6175451 Fax: (011) 6185343. Coordination compared with 7.5 million hospitalisation in Europe: European Institute for Asian Studies, Rue des Deux Eglises cases fromtop 40 percent of the population, 35-B-1000 Brussels (Tel: (32) 2230 8122, Fax: (32) 2230 5402. The of whom4.1 millionavailedof publichospital last date for submission of papersis 31 January1998. The acceptanceof facility. Let us now see for ourselves the papersis subjectto reviewby the organisers. consequences of curtailing government
AVOIDED QUESTIONS

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eightdemographic regions.In the age-group 15-59, deathrateper 1,000 in Indiain 1990 was five as comparedto three in China and Middle EasternCrescent and four in other Asia and islands. The gains from reduced childmortality thatmightundoubtedly result from the adoption of World Bank health policy package, can easily be squandered of publicclinical andcurative bycurtailment medical services as recommended by the organisation. Thus, if child mortality rate in India declines from 27 per 1,000 to the Chinese level of 9 per 1,000, about2 million deaths would be saved. But if concurrently as a result of the curtailment of public clinical andcurativemedicalservices,death rates in India among the adult age-group (15-59 years) were to increase from five per 1,000 to those obtaining in subSaharanregion, that is, 8 per 1,000, an increase of 1.4 million adult deaths would ahnost cancel out the gains in reductionin child mortality. Further disadvantage would be increased burden of disability among 15-59 age-group. If we look at India'shealthsectorin regard to the productive age-group,15-59 years,the achievements over the past 40 years have been very modest. Table 3 shows the probabilityof a 15-year-old dying before completing 60 years and life expectancy at age 15 for eight demographicregions of the world during 1950-90. Probabilityof a 15year-old in India dying before completing 60 years was as high as 25 per cent, or one in fourin 1990. This may be comparedwith China's 17.5 per cent or one in six. Even Other AsiaandMiddleEastern Crescentshow a probabilityof one in five. It is noteworthy thatChina, OtherAsia and Middle Eastern Crescentwere worse off thanIndiain 1950. Life expectancyat age 15 improvedby only six years for India, as comparedto 18 years for China, 13 years fo Middle Eastern Crescentand 10 yearsfor OtherAsia, during the 40 years, 1950 to 1990. Of the eight demographicregions, India as pointedout above, ranksthe lowest with only 1.3 percent of GDP spenton the public sector provision of health services. While per capita public expenditure on health services in India would work'out to about $ 5, public health care and essential clinial servicespackageshould,accordingto World Bank (1993), cost $ 12 per capita. Should that be so, public expenditureon health in Indianeeds to be increasedfromaround1.3 per cent to 3 per cent of the GDP. There is thusa good case forincreased,notdecreased, allocation for public health and medical services.We do not wish to be construedas suggestinghoweverthatthe existing pattern of public health spending is at all perfect. Indeedit is not.Thereis considerablescope, in our view, to reorientthe existing pattern of publichealthspending in Indiato ensure

Arthur,W B (1981): 'The Economics of Risk to Life', The American Economic Review, Vol 71, No 1. Broome, John (1985): 'The Economic Value of Life', Economica, Vol 52, No 207. - (1993): 'QALYs',Journalof PublicEconomics, Vol 50, No 2. Donaldson, Cam, et al (eds) (1988): 'Should IV QALYs Be ProgrammeSpecific?', Journal Conclusion of Health Economics, Vol 7, No 3. Health policy has to face life and death Donaldson, Cam and Wright, Ken (1989): 'Programme Specific QALYs - A Reply', problems. As W B Arthur(1981) puts it, Journal of Health Economics, Vol 8, "one often hears two different ethical No 4. argumentswhere activities that put life at Kothari, V N (1993): 'World Bank Perspective risk are under discussion: 'life is infinitely on HealthCare', Souvenirbroughtout on the occasion of Social Science Congress, 1993, valuable'vs 'social productis whatcounts'" MS of (p 65). What World Bank (1993) has done National University Baroda, Baroda. Sample Survey Organisation (1992): is that it has given exclusive importanceto Sarvekshana, 51st Issue, Journal of the thesocialproduct andthattoo in anextremely National Sample Survey, Vol XV, No 4, narrowsense, without going into its equity April-June1992, NSS 42nd Round, 1986-87. aspect or possible gender dimension. This Sanyal, S K (1996): 'Household Financing of HealthCare',EconomicandPolitical Weekly, does not mean that the pursuitof the first May 15. objective,namely,'life is inifinitelyvaluable' Sen, Amartya (1996): 'Health, Inequality and must reign supreme, given that there are WelfareEconomics', B K Kumar Endowment costs which have to be paid for. "Wedo not Lecture 1995, Centre for Development know what the right objective is. Should it Studies, Trivandrum. be to maximisethe good thatis addedto the Wagstaff,Adam(1991): 'QALYsandthe EquityEfficiency Trade-Off, Journal of Health world or the good that is added to the lives Economics, Vol 10, No 1'. of existing people, or what?" [Broome Weinstein,MiltonC ( 1988): 'A QALY Is a QALY 1985:292]. "We need sensitising and - or Is It?',Journal of Health Economics,Vol 7, No 3. humanisingdecision-makers,who will face up to the full difficulty of life-and-death Williams, Alan ( 1988): 'PrioritySettingin Public and PrivateHealthCare:A Guide throughthe decisions. But puttinga money-valueon life Ideological Jungle', Journal of Health helpsto makethedecisionsseem mechanical Economics, Vol 7, No 2. and easy. We do not want our rulers to be -(1989): 'Comment on Should QALY Be sheltered by their experts from a full Programme Specific', Journal of Health Economics, Vol 8, No 4. appreciation of their responsibilities" [Broome 1985:292]. These observations,it Wolfe, Barbara (1984): 'Measuring Disability and Health', Journal of Health Economics, must be noted, were made in the context of Vol 3, No 2. but far more to QALYs they apply strongly WorldBank ( 1993): WorldDevelopmentReport, DALYs which World Bank advocates in 1993: Investingin Health, OxfordUniversity World Bank (1993). Press.

not only better utilisation of public sector facilities and resources but also greater emphasison infectiousdiseases controland preventive aspects of health care with community involvement. Today we have primaryhealth centres and sub-centres in sufficientnumbers, butlittleof primary health care. This has to change. The World Bank (1993) prescriptionof restrictingpublicexpenditureon healthand medicalservices,eliminatingpublicsupport to specialised trainingin medicaleducation and privatisationof the remainingmedical services to be financed through voluntary medicalinsuranceschemes,is boundto lead to distressandescalation of costs. The evils of what have come to be known as adverse selection and moralhazardassociated with medicalinsurancewould automatically lead to a rise in the cost of medical services. Besides, how many people in India can afford private insurance? So also a withdrawal of public support for specialised trainingwould lead to a rise in the cost of services of doctors and surgeons, besides adversely affecting the position India has come to acquirein severalspecialised fields of medicineandsurgery. WorldBankrecommendationspay no attentionto the success of publiceffortathealthandmedicalservices in China and Sri Lanka or even Kerala.

Maximisation ofDALYs (orevenQALYs) gained does not, in our considered view, providethe rightanswerto questions raised in regardto the allocationof healthspending in the public sector. The question therefore is that if we reject this approachhow do we proceed. One objective that can clearly be statedfor Indiais that any revampingof the health system that is likely to increase ageis unacceptable. Prevention specificmortality of deteriorationin age-specific death rates has to be the first objective. Secondly, improvements in child mortality rates are needed.Thirdly, controlof infectious urgently diseases andpreventivehealthinterventions mustget priority.Fourthly,birthcontroland maternitycare need more attention.Finally, to the extent possible, the burden of the existing disabilities should be treated in a cost-effective mannerregardlessof income, age or gender. are grateful to N H Antiafor his [Theauthors on the paper.] conmments

References

Economic and Political Weekly

October 11, 1997

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