Workforce Economics in Integrated Care Systems
I have a confession to make. During four decades of experience of health economics I have shamefully neglected to focus anywhere like enough attention to the economic value of the health professional workforce. Given that for the NHS in England the health workforce accounts for around two thirds of spending, you would think that workforce value would have been high on my agenda.
I may be wrong, but I am pretty sure I am not alone amongst my health economics colleagues. Whilst there is an industry of economists helping to inform the economic value of new pharmaceuticals, new medical devices and more recently, digital health technology, few are working on workforce value. There are lots of examples of ‘efficiency’ and ‘rationalisation’ studies which try to show how we can save money by reducing workforce costs. However, examples of well-established methods and analysis to help demonstrate the investment value of training and education in new skills or capabilities, or the relative value of new workforce models, are scarce.
The health workforce is not simply an input cost in the delivery of healthcare which needs to be minimized in the attempt to curtail rising health expenditure. The health workforce is a significant generator of economic growth. It has become glaringly obvious during the COVID-19 pandemic that societal value depends on a healthy population, and this depends on a high performing and diverse health professional workforce.
So, what drives the ‘market’ for health professionals? At its simplest, the scale of demand for the health workforce and the relative mix of skills, experience and expertise is driven by underlying population health and treatment needs, models of care, system design and funding. The scale and diversity of supply of the health workforce is driven by education and training, the financial and non-financial rewards from employment, and how these compare with other career choices.
Of course, it really isn’t as simple as that.
- There are over 350 different careers. Each of these will have different drivers of demand and supply.
- Health professionals don’t work in isolation, they combine into multi-professional, multi-disciplinary teams across care settings, care pathways, and geographical networks and utilise medicines, devices and other technologies and physical infrastructure to deliver services. Context matters when measuring value.
- Depending on the role, it can take many years of training to reach career goals. Training is expensive both for the individual and the employer. The PSSRU estimate the cost of training for a consultant to be more than £500,000 with graduate and post graduate training taking around 12-13 years minimum. To add to the complexity there is a labyrinth of funding streams to support trainees and employers with these costs, and these are not consistent across professions.
- In the NHS pay levels are generally set nationally. Given the chronic levels of vacancies and relatively high use of agency or locum staff for key professional groups, these are likely to fall some way short of the genuine market price for this resource.
- Globally there is a chronic shortage of health professionals – forecasts suggest a shortage of 18m by 2030 mainly in low to middle income countries2. Developed countries have a role to play in helping to address this shortage and not simply relying on overseas staff to plug gaps in local supply.
For an Integrated Care system (ICS), getting maximum value from the health and workforce must be very high on the agenda. Workforce planning isn’t just about getting the numbers right. Maximising return on investment from the development and support of the workforce is vital. There are many strategies which employers within the ICS can invest in to:
- increase supply (e.g. retention strategies and strategies which encourage return to practice)
- develop skills (e.g. higher and post-graduate training)
- deploy new ways of working (e.g. multi-professional teams)
- utilise new roles (e.g. through advancing practice)
- improve leadership (which impacts on organisation design, culture, rewards and incentives, staff morale, working experiences).
All these strategies involve investment in resources, such as time and technology. All can be measured in terms of the value they add to the health (and care) system and wider society. All require investment funding, some of which will need co-ordinating or supported by the ICS as part of the workforce development programme. Choices about how much to invest, where to invest, and where additional funding will be needed are being made.
To finish, here is my call to action. Going forward, as part of our NHS reset, lets rebalance our focus from demonstrating return on investment in new pharmaceuticals and technology, and have a collective think about how best to analyse, measure and value investment in our biggest NHS – our people.
P.S. I have deliberately not mentioned social care… don’t berate me… that is for another blog!
 Lewry, C. et al “The Bumper Book of Health and Care Workforce Planning”, 2021.