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Commissioning: Out of the car crash and stuck in a traffic jam

PCTs find it difficult to exert control over the health activity in their area for a number of reasons:

  • FTs are independent organisations
  • GPs are independent contractors
  • Payment by results sucks activity into hospitals
  • There are few block contracts

None of these factors are addressed in the health bill. Indeed, there are more complications in the Bill that are likely to make reshaping services even more difficult. Here are a few of my concerns:

- I can see national contracts being introduced for Any Qualified Providers limiting the ability to shape contracts locally.

- The bill recommends choice along the pathway meaning referral, diagnosis, treatment, follow-up could all be done by different providers making it harder for GP commissioners to monitor quality and effectiveness.

- Private companies will follow the money and if the balance of profitability changes, they are likely to exit the market.

- With clinical senates whose roles are undefined and consultants from distant trusts on consortia boards, GP commissioners may find it increasingly difficult to get change.

So, we may have the steering wheel in our hands, but we may find ourselves less in a car crash, and more in a traffic jam. Little control over either speed or direction of travel.

Another way forward - cooperative commissioning

I believe there may be another approach that could enable us to break out of some of these constraints.

Payment by Results is an inappropriate financial driver of the NHS. It creates perverse incentives and its counterweight, clinical commissioning, is likely to be as weak as PBC.

Cooperative commissioning aims to align financial incentives in such a way that integration, collaboration and efficiency are all rewarded, along care pathways. Everyone has an incentive to make savings.

Budgets for clinical areas are given jointly to the consortium, local people and hospitals to manage and savings are reinvested – in health or elsewhere.

The incentive becomes to push towards health promotion, more efficiency, a reduction in referrals if needed. In particular, the hospital will gain by shifts to the community particularly if it is in charge of community services,.

We already know with the data and tools already available how much it spends on clinical areas and budgets are currently divided up on programme budget lines.

How it works in practice

So a calculation of a joint budget in, say, diabetes, would need to include:

• hospital costs

• community costs linked to diabetes

• possibly social care and health costs

• primary care costs linked to diabetes

• downstream costs – for instance amputations, costs of retinopathy. This may already have been part of the calculation of the programme budget

Clinicians and patients would work together to come up with the best solutions. The consortium's role therefore would be:

• To set the parameters and outcomes and quality. For instance, we would expect a reduction in attendances at A+E, a reduction in admissions from A+E, an increase in patients reporting they had received good quality information and were treated with dignity. How this is achieved would be up to the diabetes panel.

• Not to pay for poor outcomes – these would be specified in advance eg amputations, retinopathy.

• To insist on appropriate data – Patient Level Information and Costing Systems

• To ensure patient and public involvement

• To include pharmacy

• To describe the funding envelope

• To reduce the funding envelope by 2% in the first year and again by 2% in the next.

• To project manage the process

• There may need to be risk management, both financial and practical

The spend would be seen as belonging to both consortium and hospital and maybe Social Care. If savings were made through more efficient care pathway design, then the savings would be shared. If fewer patients came through the hospital's doors, the hospital would still gain if savings were being made. It would become a joint task to ensure patients received treatment in the most cost-effective way.

For many long-term conditions there are evidence-based interventions that reduce out-patient department and A+E attendance, including information-provision for self-care management and prevention. There would now be an incentive for hospitals to invest in these as well as 1y care. There may be more enthusiasm for cooperation in A+E, as savings there would mean more joint benefit.

In this way, incentives for efficient care are retained, but the planning and investment becomes a shared enterprise. We predict that NHS staff will leap at this chance to work together again in a shared enterprise.

A+E and urgent care may be another area that is suitable for this kind of approach.

The new architecture maintains PbR which, combined with new, perverse commercial arrangements, militates against supervision, quality control and financial control of the NHS.

Cooperative commissioning may offer opportunities for consortia to regain some control over their NHS spend and for different sections of the health and social care environment to collaborate in the best interests of patients.