The name is absent

3. Inputs and outputs.

Using the production function model helps us to see how outputs from one part
of the health care system can be inputs to another part. At the level of the
physiotherapy department in a hospital, labour and equipment are inputs, the
number of physiotherapy treatments the output. At another level,
physiotherapy treatment is an input into the hospital episode of care, say the
admission of people with rheumatoid arthritis. Hospital beddays are sometimes
considered an output but in this model they can be seen both as the output of
the ward∕hotel functions of the hospital and an input into the episode of care.
At yet another level, one can define the hospital episode as an input, along with
community care and rehabilitation, into the treatment of rheumatoid arthritis.

Health outcomes are explicitly focussed on consumers and the difference that
health care services make to them. Maximising health outcomes means
maximising consumer welfare gained from health care services. That in turn
depends on the individual health gain multiplied by the number of people who
gain ¹ (see technical note 1).

The focus on outcomes requires planning problems to be defined in terms of the
potential effects of health care. It requires an analysis of changes in health
status due to health service use, not of the number of people put through the
health services or waiting for treatment.

The relationship between inputs and outputs is still important, presumably if
we could have greater health care outputs we could have a greater impact on
health outcomes. If health care outputs are not contributing to health
outcomes, the inputs used in that production should be switched to another
production process to outputs that do affect outcomes.

¹ An individual’s welfare will increase if their health is improved. But one
person’s welfare may also be affected by another’s health; directly if the other
person is contagious; and indirectly if one person enjoys seeing another well.

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