Economic Solutions to Medical Queuing: A Policy Model with Random Sampling

Abstract

The paper shows that the formulation of economic criteria and their application to facilitate resolving social queues in the health sector can bring about higher social welfare levels and can be superior to, current practices of allocating scarce public services on the many demanders of the service. The model makes use of the Quality Adjusted Life Years, QALY, as an indication of the effectiveness of medical attention in terms of gained life years in good health after treatment. The model introduces the lifetime earnings of patients and links them to the QALY. Selection of patients to be treated is based on productivity as represented by the prospective income earnings of the queuing patients. Random sampling simulation (i.e. Monte Carlo method) show that patient selection based on maximizing discounted lifetime earnings would release resources that can be used for treating more patients and thus reduce waiting time, and reduce the overall cost pressures. The results will show a convergence between efficiency and fairness goals.Although the application is for the health sector in the Netherlands around 2000, the problem of social queues is not unique for health services, or developed countries. Social queues can be observed in specific educations, subsidised housing, unemployment retraining, poverty alleviation, and for many public goods in predominantly centrally planned economies. The model is sufficiently general so as to apply to more areas of social queuing than health services and to various countries and periods as well.