Have you considered the health economic impact of distribution?

An economic analysis has been undertaken to illustrate the value of the planned redistribution of HEE funded training posts by Deanery in the first three pilot specialties: Cardiology, Haematology, and Obstetrics & Gynaecology. The economic analysis sought to measure the economic value of the overall improvement in resource allocation for the NHS in England that results from the redistribution and any potential impact on health inequalities and health outcomes.  

Postgraduate medical trainees combine their training with an important service delivery role. Tariff and placement funding from HEE is intended to compensate NHS Trusts for some of the NHS costs of hosting training. The other costs faced by Trusts are funded by commissioners via contracts for NHS services. The current distribution of posts is not aligned with the relative need for health services delivered by trainees by geography and/or specialty/pathway. Affected NHS Trusts are likely to be using expensive staffing alternatives such as agency staff or experiencing chronic vacancies. 

All other things being equal, these labour market distortions give rise to an overall NHS efficiency penalty.  Applying a needs-based redistribution of training posts should reduce the distortion and improve efficiency and NHS productivity. Relative health inequality will have a compounding impact on the value of efficiency improvement. Any efficiency improvement in areas with relatively poor health outcomes can be expected to be of higher-than-average value to the NHS. Finally, improved efficiency should positively impact on the quality and quantity of health services delivered and the achievement of health outcomes goals.

Estimates of the monetary value of improved allocative efficiency suggest that for the three selected specialties:

• Health system benefit of between £21m to £106m over a 20-year period (discounted and weighted for relative health inequalities)
• Health outcomes benefit of between 1900 and 9600 Quality Adjusted Life Years (QALYs), valued at between £143m and £716m over a 20-year period (discounted).

The economic analysis presented here is very high-level. It is designed to illustrate the potential costs and benefits of the redistribution of HEE funded training posts. It does not attempt to reflect the detailed impact of these changes and associated health system responses, or any wider economic impacts on local communities.