Beyond Cost-Effectiveness: Insights for Effective Altruism from Health Economics

No longer the new kid on the block, Effective Altruism (EA) has evolved from its early days in the quadrangles of the University of Oxford to become a thriving community with a well-established architecture of philanthropic institutions. EA organisations now marshal resources in the hundreds of millions of dollars annually and the question of how to do the most good with available resources has once again become a driving force in global development discourse.

CGD itself is considered “EA-adjacent” and has roots connecting EA and global health reaching back to 2013 and an essay by EA co-founder Toby Ord on “The Moral Imperative Towards Cost-Effectiveness in Global Health”. This essay, and EA in general, focuses on the potential of using cost-effectiveness analysis to maximise impact for a given budget. However, in health policy, cost-effectiveness evidence is rarely considered in isolation and is more commonly embedded in a priority setting process known as Health Technology Assessment (HTA). This blog delves into the parallels between EA and HTA and investigates what EA might draw from HTA in the pursuit of effective prioritisation.

How does Effective Altruism approach cause prioritisation?

A defining feature of EA is the attempt to quantitatively prioritise causes and interventions, striking a balance, as it does so, between rigour and pragmatism. This blog focuses primarily on Givewell and Open Philanthropy as two of the biggest EA organisations that undertake cause prioritisation, though other organisations also engage in philanthropic evidence-informed prioritisation including Founders Pledge, 80,000 hours, and So Give.

In both GiveWell and Open Philanthropy, cost-effectiveness is central to assessing value and cost-effectiveness analysis is primarily done in-house. The similarities are not surprising since Open Philanthropy was spun out of GiveWell and there is significant cross-pollination at the senior leadership level. GiveWell identifies potential interventions for consideration, often from the academic research literature, and undertakes its own analysis of the intervention cost-effectiveness, plus considerations about a specific charity organisation, including the charity’s effectiveness, whether there is room for more funding, and whether their operations are sufficiently transparent. The crucial benchmark for demonstrating a minimum level of value for money is 10x cash (i.e. at least ten times better than giving cash through Give Directly). Successful charities make it into the GiveWell “Top Charities” list, which comes with significant funding benefits, both from Givewell and directly from donor organisations or individuals that use GiveWell’s research to inform their giving.

Open Philanthropy focuses more on cause area prioritisation and opportunities for action very broadly conceived, than specific charity organisations, and assesses these in terms of their importance, neglectedness, and tractability. Open Philanthropy’s approach is more flexible and exploratory, seeking to identify high-impact opportunities across a range of causes and being willing to back a relatively large proportion of unsuccessful investments to find that one big win. This is explicitly modelled on a venture capital style hits-based investing strategy. Shallow or medium-depth investigations are used to triage potential cause areas against a bar of 1000x cash. In contrast to GiveWell, Open Philanthropy’s cause prioritisation is not necessarily intended for public use and the organisation is primarily a channel to give away the fortune of Cari Tuna and Facebook co-founder, Dustin Moskovitz.

Selected similarities between Effective Altruism and Health Technology Assessment

HTA is a multidisciplinary health policy process that evaluates the medical, social, economic, and ethical implications of health technologies (defined broadly to include not only drugs, medical devices and so on but any health service or policy). HTA agencies consider factors such as the health benefits, potential harms, cost-effectiveness, feasibility, equity, budget impact and ethical implications of different interventions to prioritise the allocation of healthcare resources. As with EA, HTA agencies adopt a systematic evidence-based approach to support informed decisions about which interventions should be supported, reimbursed, or implemented within the constraints of available resources. By incorporating evidence-based prioritisation methods, HTA contributes to the efficient allocation of resources and the improvement of public healthcare delivery. Such processes are well established in many high-income countries but are increasingly common in low- and middle-income countries too.

Both EA and HTA are underpinned by a broadly utilitarian philosophy, emphasising the maximisation of overall welfare and well-being. They seek to identify interventions or technologies that can generate the greatest positive impact for the largest number of people. While HTA typically takes a starting point of pluralistic liberalism and establishes country-specific criteria for technology assessment, cost-effectiveness is almost always a central consideration and with it comes an implicit utilitarian ethic. However, neither EA nor HTA strictly adhere to a rigidly utilitarian approach and may assign greater value to benefits for disadvantaged populations.

Trust is a key element for both EA and HTA. Both approaches rely on robust evidence and rigorous analysis to inform their prioritisation processes. For EA, building confidence among prospective donors, regardless of their scale of contribution, is essential. By demonstrating the worthiness of their processes, EA organisations can inspire trust and encourage support. Similarly, HTA emphasises transparency, accountability, and participation to build trust among various stakeholders, including policymakers, pharmaceutical companies, and the public.

Lastly, EA and HTA must tackle the inherent complexity and uncertainty involved in decision-making regarding resource allocation. They recognise the need to navigate trade-offs, consider multiple perspectives from stakeholders, and incorporate uncertain elements such as long-term impacts and unintended consequences. The recognition of complexity and uncertainty underscores the importance of comprehensive and thoughtful analyses in both EA and HTA.

Four key differences between Effective Altruism and Health Technology Assessment

A key difference between EA and HTA is the approach to generalisability of cost-effectiveness evidence. EA will determine intervention cost-effectiveness and then tend to act as if it is equally cost-effective everywhere. The implied assumption when doing so is that cost-effectiveness is an intrinsic characteristic of the intervention, rather than an emergent property of the intervention and the context it is used in. Local disease burden, demographics, the strength of the health system and environmental factors can all be important determinants of cost-effectiveness. While EAs will recognise this limitation, and the potential variance or heterogeneity in cost-effectiveness results, it does not come out strongly in process of translating evidence to recommendations. HTA in contrast, is usually a national process that is highly sensitive to the challenges in transferring cost-effectiveness findings across borders and often also recognises variation within countries.

The second key difference is the importance placed on cost-effectiveness evidence compared to other types of evidence still intended to assess intervention value (as opposed to more practical considerations). While cost-effectiveness is usually still central to an HTA process, it is increasingly common to see additional criteria and approaches to assess value, beyond the cost per unit of health benefit. This can include quantitative measures to expand beyond standard cost-effectiveness framework such as frameworks for the consideration of impacts on financial protection or the distributional fairness (equity) of which populations benefit, rather than simply the aggregated health benefit. HTA processes also consider testimony from affected groups or might qualitatively assess the degree of innovation a new technology represents (the idea being to view genuine novelty favourably, to encourage innovation).

These more nuanced conceptions of value lead into the third key difference; the importance of deliberative appraisal. In HTA, once the relevant evidence is gathered an HTA committee will review and discuss the evidence in an intentionally deliberative exchange to appraise and, hopefully, develop a consensus view. While an ethos of challenge and openness runs through EA prioritisation, there is not a similarly formal stage of independent deliberative appraisal.

A fourth difference is how the process of prioritisation is institutionalised and who participates. HTA typically involves multiple organisations including government bodies, universities, manufacturers, advocacy organisations, and patients’ groups in a standardised process. This broader participation facilitates consideration of potential trades-offs and provides greater opportunities for challenge—resulting in better decisions, but also helping to establish trust and legitimacy with stakeholders. EA implicitly focuses on the interests and values of donors or contributors who seek to maximise the impact of their resources. It is worth observing that this population is separate from the intended beneficiary population. While there might appear to be alignment in HTA contributors (taxpayers) and beneficiaries (patients, or simply the public), the participatory approach in HTA is focused on the later, not the former. Indeed, the same logic that is leading global development institutions to improve the diversity of their leadership and decision-making processes could apply to philanthropic organisations. The case for Gavi having a more diverse board isn’t because of the public money that is channelled into it, it’s because the communities that the fund aims to serve are important stakeholders and it makes sense for them to have a say in its priorities.

Recommendations

Effective Altruism is shaking up philanthropy for the better and is pioneering more rigorous approaches to doing the most good for the resources available. Yet there are often other groups that have been doing similar work that may have developed practices worth adapting and adopting.

The similarities between EA and HTA bring the differences into relief. Since EA shares similar broadly utilitarian foundations and seeks the trust and confidence of its stakeholders in prioritising amid complexity and uncertainty, perhaps the tools of HTA might be of use. Would it make sense to be more nuanced in the treatment of cost-effectiveness evidence and its generalisability? Should EAs broaden their conception of value—and how to demonstrate it—beyond cost-effectiveness analysis? Could a more intentional stage of deliberative appraisal be helpful? Would more standardised, decentralised, and inclusive priority-setting process be advantageous?

Moreover, this comparison with HTA as a priority-setting process highlights the disconnect between EA global health investments and local institutions and systems for priority setting. Who is best placed to decide whether, say, bed nets or expensive oncology treatments are a higher priority for a country? The cost-effectiveness evidence may be objective but, as discussed there could be other relevant considerations beyond cost-effectiveness. Indeed we have recently outlined an alternative model for aid financing where domestic resources focus on a core package of the most cost-effective interventions, with health aid focusing on a top-up package of the next-most-cost-effective interventions.

Four broad actions EA organisations could consider are:

1. Trial HTA-like approaches to prioritisation. EA organisations can experiment with incorporating HTA-like processes into their cause selection procedures. This could involve systematically evaluating interventions and their potential impact and explicitly linking this to intervention context; considering multiple criteria beyond just cost-effectiveness; and involving other stakeholders, particularly those in countries EA aims to support. By adopting a more comprehensive and participatory approach, EA can make more informed and effective decisions that reflect the priorities of relevant stakeholders.

2. Commission an independent working group on priority-setting methods for philanthropy. To advance the field of priority-setting within philanthropy EA organisations could bring together a diverse group of experts and thought-leaders to focus on developing and refining these methods. The group could review similar practices in a range of other contexts; explore innovative approaches; and draw in perspectives from key stakeholders, including in low-income contexts. Such work could advance both the effectiveness and legitimacy of EA prioritisation.

3. Beyond a working group, EA could—and to some extent already does—nurture a wider community around methods for priority setting in philanthropy and it could do this with a particular focus on overcoming siloing and learning from across sectors. Initiatives like the Global Priorities Institute at the University of Oxford are a good example. By fostering a community of practice around priority-setting, EA can continuously improve its strategies for maximising impact.

4. Invest in strengthening evidence-informed prioritisation ecosystems in low- and middle-income countries. If EAs believe in using evidence to work out how best to help disadvantaged populations, they should believe in supporting disadvantaged populations to use evidence to help themselves. This could mean supporting technical assistance programmes to create or strengthen HTA or HTA-like processes—perhaps a good extension to the EA cause of Improving Institutional Decision Making. It could also go beyond institutions to encompass support for strengthening research or knowledge systems—such investing in support to reforms for research publishing.

Many thanks to Pete Baker, Rachel Silverman, Javier Guzman, and Lee Crawfurd for helpful comments.