As a new WHO Director-General—Dr. Tedros Adhanom Ghebreyesus—prepares to take office, many have called for clearer priorities, governance and organizational reforms, and funding expansions. All good, but there is one additional, grossly neglected issue that requires urgent action: WHO needs better economic advice. As I explain in this blog post, that should come in the form of appointing WHO’s own chief economist.
WHO supports countries in dealing with the tough economics and choices that inevitably bedevil health systems around the world. I don’t mean how much money there is to spend or whether in general terms more spending on health is merited or not; I mean how well or poorly does WHO help countries allocate resources wisely, given their budget constraint.
WHO recommends medicines for the essential medicines list that is sometimes adopted by member countries to inform their own purchasing. WHO recommends targets for disease control that have spending implications. WHO issues clinical guidelines that are used to inform resource allocation for the clinical treatment of different diseases. WHO advocates for policies—from universal health coverage to vector control—that are widely discussed and frequently adopted by member states. The organization plays a truly influential role.
Yet too often, the rhetoric and recommendations coming from some parts of WHO show so little understanding of basic health economics that we may be doing more harm than good.
Tony Culyer is professor emeritus at the University of York and one of the founders of modern health economics alongside Kenneth Arrow, Joseph Newhouse, Uwe Reinhardt and others. He is the founding co-editor of the Journal of Health Economics, the founding Vice Chair of the UK’s National Institute for Health and Clinical Excellence (NICE), the founding chair of NICE International, and the co-editor of the mainstay reference text, the Handbook of Health Economics. I add this lengthy preamble to convey that the man knows of what he speaks.
Tony has written an open letter to Dr. Tedros, which we are publishing here with his permission, to motivate a rethink of the economic advice provided through WHO. In the letter, Tony gives a few examples of the way in which WHO has got its basic economics wrong; namely, the recommendation of a universal threshold to decide on what products and services are cost-effective in improving health (the famous 1-3x GDP per capita rule), and the notion of “fair pricing” that ignores the presence or absence of comparator products and their relative cost-effectiveness as an input into decisions to subsidize a product and negotiate its price with suppliers.
I could add further examples, but in the spirit of moving forward, what needs to happen to bring more rigor to health economics advice from WHO? In my view, WHO needs its own chief economist—to assure that targets, guidelines, lists and policies all benefit from fifty years of theory and empirical evidence that have informed the better health systems of the world in their quest for UHC. What do you think? Comments invited below.