An index of need for psychiatric services based on in-patient utilisation

Background. The paper describes the development of an index of the relative need for psychiatric services for the purposes of distributing NHS funds in England. Method. The study is based on an empirical analysis of all psychiatric in-patient completed episodes in England in 1991/92. Any index of need should be independent of the effect of variations in health care supply on the use of psychiatric services. In order to disentangle the influences of supply from social and clinical determinants of utilisation, two stage least squares regression and multilevel modelling techniques were used. Results. The outcome was an index comprising six health and socio-economic variables, This is now being used by the NHS Executive to distribute about pound 2.2 billion of annual NHS expenditure for psychiatric services between English health authorities. Conclusion. It is shown that the index is much more sensitive to needs and therefore more redistributive than the previous index of need used in the NHS.