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The argument that health market behaviour is idiosyncratic is reviewed and evidence concerning 'Supplier Induced Demand' is presented. The theoretical basis and implications of this pivotal hypothesis are discussed.

The study examined the preferences of a sample of the Australian public and health professionals regarding the relative importance of four different criteria for prioritizing between patients: the severity of the condition, the size of the benefit from the intervention, past health losses and expected lifetime health. A discussion-group methodology was adopted to elicit social preferences. This allowed participants time to consider all of the alternatives fully, to seek clarification of the task, and to engage in open debate about the issues raised. Participants traded-off cost-effectiveness for priority to the more severely ill. They placed less importance on past health and the lifetime allocation of health in deciding priority for treatment, and more importance on improving the condition of those who will be left more severely ill or disabled in the absence of treatment. The results pose a challenge to studies reporting support for the "fair innings argument". They also support the Norwegian government's decision not to pursue a life-time health loss criterion as recommended by the Norheim Commission. The study question is important given current debate both in the health economics literature and at the policy level in several jurisdictions

AbstractIncluding the quality of life in the economic assessment of health and medical services is well established in the literature and a number of multi‐attribute utility (MAU) instruments are available which purport to measure health state utilities. One of these, the Assessment of Quality of Life (AQoL) instrument was developed in Australia and uses Australian importance weights. The present article discusses some of the methodological problems encountered by existing instruments. It outlines the construction of the AQoL Mark 2 and the methodological innovations which have attempted to overcome some of these problems.Technical and other details may be obtained in Richardson et al. (2003a, 2003b, 2003c) and Peacock et al. (2003). These papers may be accessed from the Health Economics Unit web site at 〈http://heu.buseco.monash.edu.au〉.

Faced with an ageing population and newspaper warnings that escalating costs are leading to a health crisis, debate has intensified in Australia and elsewhere on the allocation of limited health resources. But whose values should inform decision‐making in the health area, and should the influence of different groups vary with the level of decision‐making? These questions were put to 54 members of the public and health professionals in eight focus groups. Unlike previous studies, participants were not asked if particular groups should be involved in decisions but rather through deliberation and discussion nominated their own potential decision‐makers. This delivered a clear message that participants saw a legitimate role for a broad range of stakeholders in priority‐setting decisions. The results suggest that qualitative methods of investigation have the potential to improve the legitimacy and accountability of policy decisions by contributing to a better understanding of the values of the public and health professionals.