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Beat gaming by acute trusts

GPs should keep in mind the principle of caveat emptor when checking acute trust claims on commissioning budgets, says Dr Phil Taylor

GPs should keep in mind the principle of caveat emptor when checking acute trust claims on commissioning budgets, says Dr Phil Taylor

Practice-based commissioners will be familiar with the Payment by Results (PbR) system, which uses a national tariff to pay secondary care providers of healthcare for the work they do for the NHS.

The system is designed to describe the ‘result' of an episode of healthcare using codes from the Office of Population, Censuses and Survey (OPCS4) and International Classification of Diseases (ICD10) for the dominant procedure or diagnosis. These codes are grouped into Health Resource Groups (HRGs).

Each HRG is allocated a cost in the national tariff. It is intended that a system of ‘reference costs' will drive prices down to that of the most efficient provider. Codes describing procedures such as hip replacement are likely to be straightforward, meaning elective surgical procedures are less subject to potential gaming. But deciding which code represents a fair price for an emergency medical episode such as ‘off legs' might be more open to interpretation.

During a period of prolonged NHS study leave, I read about some gaming which had been reported in similar systems worldwide. Through the work we did in our practice on validating claims on our budget, I observed the potential for these and other games.

Below are some of the most common games and suggested counter strategies.

Game 1

Diagnosis equals cash or HRG creep

Trusts can encourage their coders to choose the most expensive of a number of codes which might describe an emergency admission. Even without encouragement, intelligent coding staff who understand the financial significance of coding may behave in this way.

So for example, chronic obstructive pulmonary disease with complications (attracting £2,360 under the national tariff), might become bronchopneumonia with complications (£3,340).

PBC counter game 1

Ask your PCT to support a process of validation of expensive claims by comparing the claim against the patient's clinical record. In my practice we monitored all claims by our local foundation trust for three months and discovered that at least 20% of all payments required further investigation. For a practice of 10,000 patients these claims represented payments of more than £100,000 a month. Many of these resulted from poor or absent discharge information but some were duplicate claims and inappropriate claiming.

Game 2

Cherry picking

Trusts or independent service providers can try to develop and promote services for more profitable procedures and diagnoses while running down less valuable ones.

PBC counter game 2

Many practices and PCTs are setting up services which do precisely the same – but at a lower cost. This can often be profitable and save the budget money. A common example which was introduced in my PCT was a DVT clinic, with DVTs diagnosed and managed at much less than the tariff cost.

In this case even greater savings came from patients who proved not to have DVTs, since many alternative diagnoses are much more expensive while not needing treatment. For example, when the clinic was set up, DVT in younger patients cost about £1,000 on the national tariff, but superficial thrombophlebitis, requiring simple treatment, cost more than £3,000.

Game 3

Admit if possible

Some patients referred by A&E staff or GPs can be safely discharged without admission. Our local foundation trust has set up a surgical admissions unit (SAU) to which such patients can be admitted and then discharged, some after a very short time. The main driver for this has been the need to improve A&E waiting times, but such a unit could be used to increase earnings from surgical admissions.

PBC countergame 3

Some PCTs have appointed GPs to work in A&E departments to ‘triage' admissions. If an SAU is set up in your area, consider asking the PCT to monitor admission rates.

Game 4

Choose elective or non-elective procedure by price

There is a big difference in price between elective and non-elective for some common surgical procedures. Elective cholecystectomy is £2,328, while non-elective is £4,590. Admitting a patient for cholecystitis and discharging them to be operated on electively can clock up two or more separate charges.

PBC counter game 4

It is perhaps unfair to call this a game because it often results from established patient pathways. Practice-based commissioners should identify common conditions where changes in pathways would benefit patients and save money.

Game 5

Transfer costs but keep the money

Once a patient has been in hospital for 48 hours, the payment received by the acute trust does not increase until a predetermined ‘trim point' number of days has been reached. Acute trusts can transfer the patient to a community hospital but still be paid the same amount as if they had stayed in the acute trust, potentially resulting in a big saving on costs compared with the payment earned.

PBC counter game 5

GPs with community hospitals need to discover whether and how their budgets are charged when a patient is transferred. PCTs should be negotiating with acute trusts to agree sharing of the tariff payment for transferred patients.

Game 6

‘We know we're right'

Our local foundation trust believed that as their coding was ‘externally audited', they had no need to respond to our queries. Our PCT withheld payments until queries were answered. A long stalemate ensued.

PBC counter game 6

Ask your PCT how your acute trust's claims are audited. Consider doing your own validation – it should be eligible for funding if it is likely to bring savings. Our PCT funded this up front, deducting costs from our savings. But establish that your PCT will back up your queries before you pay staff to validate, or you could be out of pocket.

Game 7

Code all diagnoses regardless of relevance

In short, acute trusts can code all medical conditions a patient suffers from and may generate a higher payment regardless of relevance to the work done.

PBC counter game 7

It is difficult for this to be countered but sudden changes in the frequency of more expensive diagnoses could be a clue to this sort of behaviour .

So is the NHS doing anything about all this?

The Audit Commission was asked last year to present proposals for quality assurance in PbR (see boxes page 29 and 30). Trusts with outlying percentages of particular diagnoses will be highlighted and subject to more detailed audit. This will improve a flawed process but there will be plenty of room for existing and new games.

A full report of our validation study Caveat Emptor can be obtained from the NHS Alliance

Dr Phil Taylor is a GP in Axminister and former PbR lead at the NHS Alliance

The scale of coding errors: findings from the Audit Commission

An Audit Commission study of clinical coding in 12 acute trusts last year found a level of errors that ‘undermined' Payment by Results. So, in 2007/8 all acute trusts will face external checks (see box overleaf).

The pilot audit found:

• an average HRG error rate of 11.9%, up to 28% in individual trusts

• errors resulted in underpayment for seven trusts and overpayment for five, ranging from £7,091 to £67,698 (5-14%) of the value of payments

• some trusts were ‘actively working to optimise their coding to maximise income', such as a clinical coding team regularly discussing the impact of coding with the finance director and pressure exerted on coders to give obstetric episodes a more complex HRG code

• evidence of inappropriate admissions that should have been treated as outpatients

• coding errors were more common for non-elective cases; for diagnosis (more costly) rather than procedures; and in general medicine and geriatric medicine

• coder error accounted for 87% of mistakes, due to low numbers of coders, insufficient training, and little or no local coding guidance

• non-coder errors were as high as 40% in some trusts, due to poor quality and availability of clinical documents, lack of clinical engagement in coding and inconsistencies between case notes and discharge summaries


All acute and foundation trusts face external checks on clinical coding for admitted care under a new Payment by Results Data Assurance Framework drawn up by the Audit Commission.
The framework aims to boost the quality of data that determines payments and underpins commissioning decisions. Acute providers and commissioners are also expected to adhere to a PbR Code of Conduct.

How the audits will work
• Auditors will compare a trust's coding with other trusts against benchmarked data

• Checks will initially concentrate on cardiology, orthopaedics and paediatrics for trusts with specialist units

• Trusts will receive six weeks' notice and audits will take up to 12 weeks

• The financial impact of incorrect coding will be included in audit reports

• PCTs and acute trusts will not be able to recoup any over- or under-payments identified; the first year is seen as a learning exercise

• Penalties for serious errors should be considered in the future

• The Audit Commission will publish national reports and guidance for PCTs on tackling errors

• Coding for outpatients, critical care and A&E may be audited in future years

When will your trust/s be audited? When will your trust/s be audited?

Quarter 1 (April-June 2007) East of England Quarter 1 & 2 (April-September) South Central
Quarter 2 (July-August) London, East Midlands
Quarter 2 & 3 (July-December) North East
Quarter 3 (October-December) North West Quarter 3 & 4 (October 2007-March 2008) West Midlands
Quarter 4 (January-March 2008) South West (pilot area), South East Coast, Yorkshire and Humber (pilot area)


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