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Policy Research Programme Policy Research Unit - Economic Methods of Evaluation in Health and Care Interventions


Published: 09 August 2022

Version: 1.0 - August 2022

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Area of Research: Economic Methods of Evaluation in Health and Care Interventions

Section 1: Summary of main strands/themes for research

Policy makers in health and social care need evidence to inform allocation and use of resources to maximise health, quality of life and independence. This PRU will help meet these needs by providing evidence on costs and cost-effectiveness. This will be primarily by developing methodologies for measurement, and by conducting studies of interventions across health services, mental health, adult social care and public health.

The PRU programme should be responsive to emergent priorities, through engagement with analysts and policymakers to ensure the programme continues to meet the priorities of the Department of Health and Social Care (DHSC) and the health and care system.

Methodological research

The methodological programme should include:

Measurement of outcomes across health and social care

  • Measuring outcomes in a consistent and integrated way, including:
    • Development of measures which capture both health and social care objectives, so relative effectiveness of forms of integration can be evaluated.
    • Development of outcome measures (e.g. quality of life / wellbeing including for example the relationship between Adult Social Care Outcome Tool (ASCOT) and EQ-5D).
  • Assessment of existing outcomes measures, for example:
    • Is EQ-5D the best tool for measuring health outcomes? What alternatives exist, including internationally?
    • How do measures adequately address priority areas such as mental health, children’s health, and dementia?

The role, importance and measurement of other determinants in evaluation

  • What equity weight should be given to people according to factors such as income and health state? For example, are there trade-offs between health outcomes overall and the distribution of these outcomes? How could these be measured?
  • How does society value different aspects of health? Common outcomes to inform policy usually include measures of health gain and distribution of health gains. How should other aspects be included such as caregiver burden, patient satisfaction, access, safety etc?
    • What are possible trade-offs between quality-adjusted life-years (QALYs) and other aspects of value in health? How much weight should be given to these other aspects?
  • Role of health in the wider economy and wider societal impacts.
  • Innovation and new technologies.
    • How much does society value novelty in interventions and what weight should be given to this? What is the trade-off with QALY gained/loss?
    • Role of regulatory approval of new and innovative technology on investment levels in the economy including in the life sciences sector.
  • Importance of health as a determinant of the standard of living both directly and indirectly with impact on other determinants of quality of life.

Resource allocation / allocative efficiency

  • Health opportunity cost estimates across the health and care system, including:
    • How to include public health and social care given issues in applying QALYs across sectors?
    • How and why might these change over time?
    • Allocation between specialities (which area might be ‘under-funded’ – given the variation in cost per QALY estimates across clinical areas identified in recent studies).
  • Consideration of the opportunity costs relating to other non-health outcome objectives (including for social care).


Methods for obtaining expert opinion to support guidance development, including in areas where evidence may be limited.

Applied research

While the strengths of this PRU are in methodological development, its programme should include applied studies. Topics may include:

  • Economic evaluation of interventions in health services, mental health, adult social care and public health including:
  • Informing resource allocation for interventions in health services, public health and social care.
  • Assessing user preferences for services in order to inform decisions on commissioning and management in health and social care.
  • Assessing the value of interventions for high-cost users, where quality of life outcomes may not align with people’s preferences (including people living with multiple long-term conditions who have uncoordinated care).
  • Public health: prevention - appropriately determining valuation.
  • Precision medicine – are existing health technology assessment methodologies appropriate?
  • Which implementation support initiatives are most effective in ensuring adoption of guidelines?
  • How to capture the impact of distributional factors being in economic evaluations, with impact on resource allocation (e.g. efficiency vs equity)?
  • Economic evaluation across health and social care in the context of Integrated Care Systems

Section 2: Details of policy context and background

A key customer for the work of this unit will be the Appraisal Alignment Working Group, an analytical group tasked with examining appraisal practice health bodies. This group is chaired by the DHSC Chief Economist with members across DHSC and its Arm’s Length Bodies, with academic experts. The PRU engages with this group to agree priority work areas.

Section 3: Justification for research topics

Identifying the optimal allocation of available resources in order to maximise population welfare gains continues to be a key challenge for health and care systems. Demand will increase due to socio-demographic pressures and rising expectations, whilst resources are inevitably constrained. Research has an important contribution to make in providing evidence to help the Department make the most effective use of resources.

There is less evidence in adult social care compared to health, as to effectiveness and cost-effectiveness of interventions. This new unit will work alongside other research units (see section 4) to help address this gap.

Section 4: Other related research activity of which the unit will need to be aware

The focus of this PRU on methodology should complement other PRUs with economic expertise but with more applied programmes. This Economic Evaluation PRU should be a source of expertise to help DHSC policy makers and analysts, and the other PRUs to plan and scope evaluations. Bidders should therefore consider how they will engage with other PRUs to ensure learning is applied for most benefit.

This PRU programme takes place in the context of significant related DHSC, NHS, NICE and NIHR activity, as well as research supported by other funders notably UK Research and Innovation. It will be important to align with strategic policy issues in health and social care, and related DHSC needs, including emergent high priority cross-cutting issues.

Section 5: Other issues relevant to this programme of research

Long-term reform of the health and care system and associated strategic challenges will be of continuing importance. Evidence will be needed to feed cross government Spending Reviews.