Demand and utilization

Need must be distinguished from demand and utilization: demand is an economic term, a measure of the quantity of services consumers seek to obtain. Demand is more dynamic than need, in the sense that it is influenced by many factors, including system-level factors such as the cost to the consumer (price), available alternatives and their prices, and individual factors such as education, the effects of advertising, distances, and social pressures including stigma. A simplified economic model of the relationship between demand and need is shown graphically in Fig 1. Need is expressed in terms of a certain amount of service required to obtain a certain benefit. It does not vary with price: however costly, or however cheap, the need is the same. Demand, on the other hand, is influenced by cost, which may be measured in monetary, social (stigma), or physical (effort required) terms. Demand decreases as cost to the consumer increases. If the price is low, demand will ensure that needs are fully met. If the price is very low there may be overprovision (in other words, more services provided than are needed). If the price is high, demand will be less than need. In reality, the demand curve is much more complex than this simplified model: as noted above, price is not the only variable affecting demand.

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Fig. 1 Need and demand.

Utilization is the actual quantity of services used over a specified time. Government health agencies, such as the Department of Health in England or the Center for Mental Health Services in the United States, and third-party payers, such as state Medicaid agencies in the United States, commonly collect utilization data. These data sets include information on admission rates, length of inpatient stays, numbers of outpatient visits, etc. Utilization can be highly variable from place to place (see

Fig 3). It bears an indirect relationship to need, but is actually the product of supply and demand. Factors other than need that influence utilization include the following.

Fig. 3 Number of inpatient and residential treatment additions to mental health organizations per 100 000 civilian population by state, United States, 1990.

• Local professional practice: if a service is not highly valued it may be underutilized, as has been the case for partial hospitalization programmes and other alternatives to inpatient care in many places.

• Availability: if a service does not exist at a certain location, there will be no utilization. For example, electroconvulsive therapy is not equally available everywhere; variations in its utilization in different places do not necessarily represent differences in need.

• Accessibility: barriers to care can occur both on the supply and demand sides. Supply-side barriers include inaccessibility of services for a variety of geographical, cultural, or language reasons. Demand-side barriers, in addition to cost, include ignorance and stigma, which may prevent people from seeking treatment. Distance may also constitute an accessibility barrier. As long ago as 1866 Edmund Jarvis demonstrated in New York State that admission rates to hospitals from the different counties served by a mental hospital varied inversely in proportion to the distance from the hospital. (6) This phenomenon, 'Jarvis's law', has been observed to apply even in much smaller geographical catchment areas.(7) In economic terms, the demand for the service is inversely related to the cost, in terms of time and money.

• Acceptability: the willingness or ability of individuals to participate in or co-operate with a specific intervention also affects utilization. For a variety of reasons, patients may find certain treatments unacceptable (e.g. clozapine treatment, vocational rehabilitation, or psychotherapy).

Use of the logic of market demand as a way to understand mental health service utilization is complicated by the fact that users of mental health services often do not seek services of their own volition, but are referred or even pressured to obtain services by other people, including their families, their physicians, etc. Professionals or advocates, rather than consumers, create demand for services. Consumers in most cases do not personally bear the financial cost and utilization is controlled by regulation and the constraints applied by those who are paying for the service. Thus it becomes apparent again that although utilization data are most readily available, they bear only an indirect relationship to need.

Unmet need is the difference between need and utilization, where need exceeds utilization. Overprovision is the difference between need and utilization, where utilization exceeds need. Theoretical problems and practical necessities

Whatever the difficulty of making rational estimates of needs, government health agencies are none the less often compelled, as are clinicians, to make important decisions in the absence of adequate data. What is more, although the mandate of public administrations is to ensure that the needs of their populations are met, they are constrained by political and economic realities. They must modify what is ideal in the light of what is politically feasible and what is affordable. The policies they develop bear some relation to the needs of patients, but are strongly influenced by economic factors, politics, cultural understanding of mental illness, the need to protect the community, and other considerations. It is the role of science to provide the best data on which policy decisions can be based:

The controversy over need goes to the heart of why we as a society purchase mental health care. Should we seek to provide treatment to all persons who suffer from mental disorders? Or should we limit care to those who are functionally impaired by their condition, or to those who have a high likelihood of recovering the ability to function? Should priority be given to people who have the most severe burdens or to those whose illnesses are most costly to society? Such difficult questions are central to the ongoing debate over need.

Discussions of need rightfully belong in the domain of political rather than scientific discourse. Conclusions are ultimately based on values rather than facts. (8) Assessing needs Clinical level Standards of care

The lack of defined agreed standards for clinical care is a major stumbling block in determining whether needs have been adequately met. For example, there can be considerable debate regarding which patients with schizophrenia need special housing arrangements, and there is no clear definition of which patients can be treated effectively by primary care practitioners and which need specialist treatment. Experts differ as to which alcoholics need inpatient as opposed to outpatient detoxification. For an individual patient, a professional estimation of need is based upon the clinical judgement of the responsible treatment provider.

The variability of standards is exemplified by variations in hospital admission rates in different places and at different times. For a century, an informal standard of care existed that required that persons with serious psychiatric disabilities be treated in hospitals, often indefinitely. The abandonment of this standard in favour of community care is demonstrated in Fig, 2, which shows that many fewer people are treated in psychiatric hospitals in England now than was the case even a few years ago. This change in utilization can clearly not be taken to reflect less need, from a person-centred perspective. The changing standard of care, however, affects needs assessments from the service-centred perspective, as implemented by planners and administrators. The fact that, in the United States, more psychiatric patients are admitted to hospitals in the south-eastern states than in the north-western states ( Fig 3) can hardly be attributable to differences in psychopathology or need among patients in these regions. The different rates almost certainly reflect regional differences in clinical philosophy, and the willingness of purchasers of care to approve hospital admissions.

As a step in the direction of developing standards, the American Psychiatric Association has developed guidelines for the treatment of such conditions as schizophrenia,(9) bipolar disorder,(l° and substance dependenceAl) These are guidelines and comprise summaries of the current state of clinical knowledge. They list available treatments and the evidence available for their effectiveness. As their authors point out, these guides for evidence-based practice do not constitute standards of care.

Estimating the needs of individuals

The primary purpose of the psychiatric evaluation of a patient is, in effect, an assessment of need. First, a diagnostic formulation is made, based on the history obtained and the examination of the patient. The psychiatrist then develops a plan of treatment after a consideration of the diagnosis, the severity of the symptoms, the patient's functional impairment, the patient's current living situation, the availability of social supports, and other circumstances of the patient. This plan is not arrived at on a formula basis (e.g. 'all patients with mania need mood stabilizers'), but is based on the assessment of the needs of a particular patient in a particular situation.

In the United States, a plan developed by a treatment provider or team, listing the clinical needs of the patient and methods to address them, is referred to as an individualized treatment plan. Such a plan, which is a requirement in many American health-care settings, grew out of the concept of problem-oriented records. (12> The problem-oriented medical record defines what are the needs ('problems') of the patient. It then records the process of planning interventions and assesses progress towards meeting the needs (resolving the problems). The problem-oriented record aims to reduce vagueness of purpose and routinization of health care by forcing the health-care provider or team to define the specific, individual needs of the patient. Problems are listed in the individualized treatment plan in quantitative or measurable terms, so that it may be possible to determine at some stage to what extent the problems may have been solved, or the needs met. For example, needs during an episode of care might be stated as 'Eliminate suicidal thinking' or 'Hamilton Depression Rating Scale score will be < 20' or 'Reduce hand washing to six times per day'. In a comprehensive community-care model other needs might include 'Obtain social security benefit' or 'Ensure payment of rent on time'. These needs should be agreed upon by the patient with the treatment team, as should the strategies to be employed to meet the needs.

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