Allocating resources between health care regions: Catchment populations and allocating for equity

Catchment population formulae have been suggested for some time as a method for allocating funds in regional health care systems. The main themes of this paper are first, to show that catchment population formulae can be derived from spatial interaction models and second, to determine which of the proposed catchment population formulae is the ‘best’ to use for allocating resources. A number of criteria for determining the best formulae are considered. The model underlying the treatment intensity formula predicts flows the best, but it has practical problems when it is used for allocating resources. The other two formulae considered, the net flow method proposed by the Resource Allocation Working Party, and the proportional flow method are more robust.