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Background: Health organizations the world over are required to set priorities and allocate resources within the constraint of limited funding. However, decision makers may not be well equipped to make explicit rationing decisions and as such often rely on historical or political resource allocation processes. One economic approach to priority setting which has gained momentum in practice over the last three decades is program budgeting and marginal analysis (PBMA). Methods: This paper presents a detailed step by step guide for carrying out a priority setting process based on the PBMA framework. This guide is based on the authors' experience in using this approach primarily in the UK and Canada, but as well draws on a growing literature of PBMA studies in various countries. Results: At the core of the PBMA approach is an advisory panel charged with making recommendations for resource re-allocation. The process can be supported by a range of 'hard' and 'soft' evidence, and requires that decision making criteria are defined and weighted in an explicit manner. Evaluating the process of PBMA using an ethical framework, and noting important challenges to such activity including that of organizational behavior, are shown to be important aspects of developing a comprehensive approach to priority setting in health care. Conclusion: Although not without challenges, international experience with PBMA over the last three decades would indicate that this approach has the potential to make substantial improvement on commonly relied upon historical and political decision making processes. In setting out a step by step guide for PBMA, as is done in this paper, implementation by decision makers should be facilitated. [ABSTRACT FROM AUTHOR]

Background: The value of a life is regularly monetised by government departments for informing resource allocation. Guidance documents indicate how economic evaluation should be conducted, often specifying precise values for different impacts. However, we find different values of life and health are used in analyses by departments within the same government despite commonality in desired outcomes. This creates potential inconsistencies in considering trade-offs within a broader public sector spending budget. We provide evidence to better inform the political process and to raise important issues in assessing the value of public expenditure across different sectors. Methods: Our document analysis identifies thresholds, explicitly or implicitly, as observed in government-related publications in the following public sectors: health, social care, transport, and environment. We include both demand-side and supply-side thresholds, understood as societies' and governments' willingness to pay for health gains. We look at key countries that introduced formal economic evaluation processes early on and have impacted other countries' policy development: Australia, Canada, Japan, New Zealand, the Netherlands, and the United Kingdom. We also present a framework to consider how governments allocate resources across different public services. Results: Our analysis supports that identifying and describing the Value of a Life from disparate public sector activities in a manner that facilitates comparison is theoretically meaningful. The optimal allocation of resources across sectors depends on the relative position of benefits across different attributes, weighted by the social value that society puts on them. The value of a Quality-Adjusted Life Year is generally used as a demand-side threshold by Departments of transport and environment. It exceeds those used in health, often by a large enough proportion to be a multiple thereof. Decisions made across departments are generally based on an unspecified rationing rule. Conclusions: Comparing government expenditure across different public sector departments, in terms of the value of each department outcome, is not only possible but also desirable. It is essential for an optimal resource allocation to identify the relevant social attributes and to quantify the value of these attributes for each department. [ABSTRACT FROM AUTHOR]