How health managers think about risk and the implications for portfolio theory in health systems

Attention is now being paid in the health economics literature to the insights offered by portfolio theory. Portfolio theory points to the advantages that arise from consideration of both risk and return when setting priorities. Realising these benefits assumes that managers in the health sector have the same understanding of risk as that suggested by the theory. We set out to explore this issue in interviews with health care managers in Alberta, Canada. To provide a point of reference and possible contrast, we also elicit the views of managers in Alberta's main industry, the oil and gas sector. Interviews were held with 25 managers across the two sectors and thematic analysis applied to draw out the main lessons from the interviews. To the oil and gas managers, risk meant opportunity that was worth taking if the return was high enough. To the health managers, risk was seen mainly in epidemiological terms as hazard and something to be avoided at all costs. Rather than reflecting a different understanding of risk, however, health managers had a more nuanced attitude, which is understandable given the consequences of adverse outcomes and the political furore that then follows. The politicisation of risk in health and its association with adverse outcomes suggests that it might be better to avoid this term when thinking about resource allocation across a portfolio of health promoting interventions and to use uncertainty instead.