The political economy of priority-setting in health in LMICs

This is a discussion summary based on a private roundtable meeting held at the Center for Global Development in February 2015.

Update (7 Sep 2015): The paper by Hauck & Smith is now published in the iDSI Knowledge Library.

Why study the political economy of priority-setting in health?

The global health agenda aims to reach universal health coverage (UHC)—which the WHO defines as providing “access to key promotive, preventive, curative and rehabilitative health interventions for all at an affordable cost.” Though UHC may be in the far future for many countries, priority-setting is needed to use resources efficiently, and the reality is that there are many objectives and interests competing for limited resources. In many low- and middle-income countries (LMIC), ad hoc processes drive choices that can result in low value and inequitable resource allocation.

iDSI provides LMIC governments with practical support and knowledge products so countries can create institutions that lead to better decisions and ultimately better health. We aim to increase goal-consequent resource allocation, not only to maximize health but also to consider equity, financial protection, and other values.

In global health, we don’t have full understanding of what prevents a government from making goal-consequent resource allocation decisions[1] that use technical information such as cost-effectiveness analysis. The study of politics and political economy, which is fundamentally concerned with conflict of interest, is one lens through which to gain greater understanding of these issues. With a clearer picture, perhaps we can work with governments to formulate strategies to manage competing objectives, demands, and interests—and give donors greater visibility into government processes and preferences so they can better align their decisions with those of government.

Existing literature

Unpacking the complexities of political economy of priority-setting in health is important, but how do people currently study this topic? As part of the iDSI’s work, Jesse Bump and Angela Chang are developing a framework to help analysts and policymakers better understand, predict, and manage the political and economic forces that shape priority-setting. Bump and Chang reviewed syllabi related to health policy and political economy from leading graduate programs in health systems. Though theories with potential explanatory power to analyze the design of priority-setting tools (in particular, health benefits plans), do exist, Bump and Chang have found that at the moment, there is no defined framework or method of study.

In motivating a forthcoming paper, “Departures from cost-effectiveness recommendations: The impact of health system constraints on priority setting,”[2] Katharina Hauck and Peter Smith similarly find little research investigating the political economy of the health sector. Hauck and Smith examine models of political economy and public choice and describe how decision makers react to political realities.

While available literature may not provide a specific framework of analysis, a number of related and overlapping literature does exist and provides an important starting point for discussion. For instance, some of this literature addresses how agencies and actors do and don’t affect decision making in health policy. In a systematic review, Parkhurst and colleagues (2013) found the need to address political and institutional factors affecting the use of evidence in health policy.[3]  Walt and Gilson (1994) argue the need for health policy to focus on the actors involved in policy reform over the content of reform.[4] Reich (1995), through examination of pharmaceutical policy reform, and Lakin (2010), through examination of Mexico’s Seguro Popular, argue that a successful health reform requires analysis of political conditions and factors.[5],[6] The references discussed are just a subset of available literature by the mentioned authors and others—and relevant literature outside of the health sector may apply in some instances.

The existing and ongoing research of the political economy of priority-setting in health provides a platform to consider future investigations.

Questions for further study

A body of literature related to the political economy of priority-setting in health does currently exist, but many questions remain unanswered—and these questions provide great opportunities for future study to inform more effective policies.

A set of questions center around the politics of implementation of priority-setting tools and their processes: these questions are listed in the table below. The questions begin with the start-up of a priority-setting mechanism (i.e., what leads a county to want to set up processes for priority-setting?), and also include the role of politics in deciding what technologies or interventions get evaluated, invested, and disinvested—as well as in the reversal of certain decisions.

Sample Decision Making Points Sample Questions
  • What are the politics of starting up a health technology assessment agency or developing a health benefits plan from scratch?
  • What leads a country to want to implement such processes, and why?
Consideration for evaluation (scoping decisions)
  • What are the politics around each step of the technical decision making process, including: consideration for evaluation (scoping), investment, and disinvestment—as well as the reversal of certain decisions?
  • What set of issues does a priority-setting agency or unit address?
  • What role do contextual factors play?
  • What role do clinical guidelines play?
  • Do governments conform to what they say they do?
  • One option: prospective observational study around the adoption decisions of a new technology, such as the malaria vaccine candidate, RTS,S
  • Other possible data source: Pharmaceutical Pricing and Reimbursement Information (, a peer-to-peer exchange between European countries and beyond, on coverage of new drugs
Reversal of decision

Another set of questions examine the priority-setting process at a higher level, such as its evolution, “success or failure,” and influence.

Sample Questions
  • How does the priority-setting process in a country evolve over time?
  • What determines “success or failure” of priority-setting units and agencies?
  • To what extent do agencies transform decision making in the health sector as a whole?
  • To what extent do these priority-setting units and agencies displace irrationality in the system?
  • What are the downstream consequences of priority-setting decisions?
  • What explains variance in the influence of these agencies/units on budget decision making?
  • How are countries emulating? Is there an emerging, global norm in priority-setting processes (e.g., diffusion, emulation of NICE)?

Next steps

Many study questions remained unanswered, and the iDSI’s currently planned political economy work will only address a small part of it. Moving forward, the paper by Bump and Chang will study: What are management strategies that enable effective use of technical information on adoption decisions? The research will be limited to countries with well-established formal priority-setting / HTA processes and institutions. In addition, a research team will conduct two country case studies with country qualities similar to those considered in the framework paper. Tentatively, the two countries will be Thailand and South Korea. We look forward to continuing to share knowledge and work in this space.

[1] Meaning resource allocation consistent with a country’s health system goals, whether they be health maximization, greater equity, enhanced financial protection, greater responsiveness or other.

[2] A chapter of broader political constraints work for iDSI by K Hauck, R Thomas, and PC Smith

[3] M Liverani, B Hawkins, and J Parkhurst (2013) “Political and Institutional Influences on the Use of Evidence in Public Health Policy. A Systematic Review.” PLoS ONE 8(10):e77404.

[4] G Walt and L Gilson (1994) “Reforming the health sector in developing countries: the central role of policy analysis.” Health Policy and Planning 9(4): 353-370.

[5] M Reich (1995) “The politics of health sector reform in developing countries: three cases of pharmaceutical policy.” Health Policy 32(1-3):47-77.

[6] J Lakin (2010) “The End of Insurance? Mexico’s Seguro Popular, 2001–2007.” Journal of Health Politics, Policy and Law 35(3):313-352.