As health systems face budget constraints and shifting aid priorities, University of York researchers have contributed to the HIV Modelling Consortium to explore how economic theories from finance and climate change can refine health investment decisions amid high uncertainty and declining global aid. In two short videos, Professor Jacco Thijssen and Professor Mark Freeman share key insights, exploring how "real options" and "insurance value" concepts can help decision-makers in formulating policies for HIV control.
Dynamic Policy Switching for HIV Treatment - Prof. Jacco Thijssen
Drawing on Real Options Value from finance theory, Prof. Thijssen warns against prematurely scaling back HIV prevention programmes as incidence drops. If there is a chance these interventions may be required again as cost-effective strategies in the future, maintaining capacity avoids the high costs and risks associated with attempting to restart dismantled systems. Therefore, decision-makers need to carefully consider which facets of HIV programmes might be required again in future.
The Insurance Value of Health Control - Prof. Mark Freeman
Prof. Freeman highlights the ‘Insurance Value’ of investing in health control measures. Investing during stable economic periods prevents catastrophic and costly disease outbreaks during downturns, when health benefits carry their highest relative value. Consequently, health systems should consider reallocating fixed budgets toward interventions that offer this insurance value against systemic threats like HIV and other infectious diseases, rather than focusing solely on interventions without these protective properties.
Policy & Implementation Implications
Combining these two approaches offers a framework for health system resilience:
- Evaluating Irreversibility: If a policy change is irreversible and risks catastrophic outcomes, decision-makers should be willing to pay a high premium to prevent it.
- Manageable Adaptations: Conversely, flexible changes (such as integrating clinic-level patient care) that can be monitored and adjusted carry lower systemic risk.
Advancing Health Economic Evaluation
Building on these concepts, recent research by Rao, Freeman, Thijssen et al. (2026) proposes integrating methods from financial economics to strengthen the evaluation of health investments that build system resilience. By integrating these insights into economic evaluation methods, they aim to strengthen the analytical frameworks that inform health policy decisions, particularly by identifying where conventional approaches may undervalue systematic and systemic risk reduction benefits.
Integrating real options and insurance value perspectives into health economics can equip policymakers and planners to build robust systems capable of withstanding unexpected economic shocks. We encourage you to explore the videos to hear the insights in full. To learn more about ongoing research, take a look at our current projects or explore our publications.
Acknowledgment
These videos are based on research funded by (or in part by) the Gates Foundation as part of the project titled: Planning the Future for Networking HIV Modelling: The HIV Modelling Consortium. The findings and conclusions contained within are those of the authors and do not necessarily reflect positions or policies of the Gates Foundation.
By: Kath Devlin | August 2026
