Investing in prevention: time for systems to work together Association of Directors of Public Health conference 2 nd November 2015 Professor Brian Ferguson Chief Economist

What do we spend on prevention across the PH, NHS and social care systems? We don’t really know, but a figure of 4% is often quoted (recent LGA report 5%) Suspect largely based on a PH spend of around £5bn and an NHS spend of around £120bn If we included all primary, secondary and tertiary prevention, the figure would be much higher than 4% This is why we are interested in much more than the PH grant when we talk about the economics of prevention The prize? –a higher % of ‘protected’ preventive spend –essential if the NHS is going to do things differently –funding gaps are largely predicated on ‘business as usual’ (and history tells us that they will only get worse) 3

NHS 5-year forward view The health and wellbeing gap: if the nation fails to get serious about prevention then recent progress in healthy life expectancies will stall, health inequalities will widen, and our ability to fund beneficial new treatments will be crowded-out by the need to spend billions of pounds on wholly avoidable illness. Public Health England’s new strategy sets out priorities for tackling obesity, smoking and harmful drinking; ensuring that children get the best start in life; and that we reduce the risk of dementia through tackling lifestyle risks, amongst other national health goals. Progress? –Prevention Board –Diabetes Prevention Programme –NHS Efficiencies work 4

Wanless got it right Wanless (2007): “Without improvements in productivity and greater efforts to tackle the causes of ill-health, even higher levels of investment in the NHS will be required than envisaged by the fully engaged or solid progress scenarios” ‘Fully engaged scenario’: levels of public engagement in relation to their health are high: life expectancy increases go beyond current forecasts, health status improves dramatically and people are confident in the health system, and demand high quality care. The health service is responsive with high rates of technology uptake, particularly in relation to disease prevention. Use of resources is more efficient. 5

The prevention challenge 6 Do the most cost- effective things Save the system money Demonstrate return on investment

Cost-effectiveness, RoI and cost savings An intervention can only be cost-effective relative to other interventions or some sort of ‘standard’ or threshold (e.g. the NICE £20,000 cost/QALY threshold) Will that intervention demonstrate a return on investment? –i.e. the benefits will ultimately outweigh the costs –if so over what time period? Will costs ultimately be saved? – i.e. over time will we spend less to achieve desired outcomes than what would have happened without the intervention? 7

One system working together across the NHS, public health and social care a focus on individuals - integrated care pathway work from Commissioning for Value programme integrated budgets and joined-up commissioning genuinely commissioning for population health King’s Fund report Feb.’15 “Population health systems: going beyond integrated care”  population-based budgets to align financial incentives with improving population health  community involvement in managing their health and designing local services 8

Open debate about the methodological and practical challenges have we the tools to produce business cases for public health investment (identifying value gained from resources invested)? do we have a ‘common currency’ for assessing impact of health & well- being? (local government unlikely to see value of QALY approach) identifying the impact of cost-effective interventions on health inequalities learning from other sectors that routinely use CBA and undertake impact assessments of policies with multiple outcomes (what approaches do they use to ROI?) dealing with externalities (e.g. alcohol-related harm) discounting – will prevention ever be prioritised if the playing field is level? training and awareness-raising activities about what health economics can and cannot deliver 9

Opportunities and challenges Using all of local government resources to improve health and wellbeing Doing this in an integrated way across the public health, NHS and social care systems Maintaining a focus on the most cost-effective (upstream) preventive interventions Timescales within which can expect to see a ROI Incentive issues across the system (investing in one sector with the benefits / savings realised elsewhere) Cashable savings - getting money out of the system now The cost-effectiveness threshold for public health interventions Does serious system change to invest in prevention require an element of double-running costs? 10

Some personal reflections HM Treasury is hungry for examples of where investing in prevention and early intervention has demonstrably worked – real case studies…. ….not unfulfilled promises of ‘invest to save’ Radical solutions welcome to HMT? (in all the years of NHS growth did the system of delivery change radically?) The ‘bar’ is being set higher for preventive interventions and we have to challenge that Whilst a focus on short-term cashable savings is justifiable and important, we need to keep our eye on the long-term prize…. Getting a larger share of the overall cake (c.£125bn, not c.£5bn) focused on preventive activity 11

Take-home messages We have a once-in-a-lifetime opportunity to shift the balance of resources towards prevention and early intervention It requires a sustained focus on outcomes and investing in areas of proven cost-effectiveness It requires us to operate collectively as a system with the right incentives in place Closing the funding gaps will not be achieved by more of the same We need to get the system incentives right and be clear and realistic about timescales for ROI….. And be realistic about cashable savings – the scope and how these might be achieved 12