PAYMENT BY RESULTS STRATEGIC ISSUES

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PAYMENT BY RESULTS- STRATEGIC ISSUES

• Rachel Hardy
• Birmingham and Black Country SHA

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INTRODUCTION

• How PbR fits into overall system reforms.
• The aims of PbR.
• Timescales.
• What does PbR mean to organisations?

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Transformational Change

• Public Service Agreement
• Overall Aim
• Transform the health and social care system so
  that it produces faster, fairer services that
  deliver better health and tackle health
  inequalities

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4 Principles of Public Sector Reform

• Devolution and delegation.
• Standards and Accountability.
• Flexibility
• Choice and Diversity.

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plurality
New providers
DTCs
Foundation Trusts
Patient Choice
Transparent system. No necessary bias to current
provider. Easier to shift money between providers
Money flows with the patient. Trusts paid for
doing this activity
PAYMENT BY RESULTS
Efficiency
Transparency
Fairness
Reward
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AIMS of PbR

• Pay NHS Trusts other providers fairly and
  transparently for services delivered.
• Rewards efficiency and quality in providing
  services.
• Supports greater patient choice and more
  responsive services.
• Enables PCTs to concentrate on quality and
  quantity rather than price.

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Timescale for Introducing PbR

• Phase 1 2003/05
• Introduce the tariff in a limited way.
• Increasing cost and volume commissioning.
• Foundation Trusts
• Phase 2 2005/08
• Tariff and CV commissioning applied to most
  activity.
• Transition path to tariff prices for Trusts and
  PCTs.
• Phase 3 2008
• Full roll out.
• Tariff prices for almost all activity

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Consultation

• Key Areas
• Tariff Structure
• Tariff Scope
• Transition
• Commissioning.
• Trust Financial Regime
• Costing
• Timescales

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What does PbR Mean to Organisations?

• NHS Trusts
• PCTs
• SHAs
• The facts and the Issues

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What Does it Really Mean to NHS Trusts?

• The Facts
• Trusts receive income at national tariff.
• All activity above or below baseline will be
  adjusted at full cost.
• Activity will move from FCE based to spell based
  from 2004/05.
• A spell includes all FCEs within an Inpatient
  stay. It is classed as the most resource
  intensive FCE.

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What does it Really Mean to NHS Trusts?

• The Issues
• If costs are above tariff the trust will have a
  deficit.
• If costs are below tariff the trust will have a
  surplus.
• Spells could cause a cross subsidisation between
  specialties.
• Performing above or below SLA will be compensated
  at full cost.

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What Does it Really Mean to NHS Trusts?

• The Issues
• Internal monitoring to be reviewed.
• Understanding activity flows and referrals.
• Understanding case mix.
• Management of risk.
• Future investments and business planning.

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What Does it Really Mean to PCTs?

• The Facts
• Allocations will be adjusted to ensure that
  activity can be funded at national tariff.
• This could be an increase or a decrease and could
  affect Distance from Target.

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What Does it Really Mean to PCTs?

• The Issues
• No issues with price.
• Volume of activity.
• Services outside of tariff to be considered.
• Linking PbR with the Choice Agenda.
• The quality Agenda.
• Foundation Trusts agenda in 2004/05.

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What Does it Really Mean to SHAs?

• The Facts
• SHAs currently have to deliver a balanced
  financial position across the SHA.
• Health Economy working is required.
• Recovery Plans are managed as part of the overall
  SHA control total.

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What Does it Really Mean to SHAs?

• The Issues
• How will organisations be performance managed in
  the future?
• Will there be less of an incentive for joint
  working?
• Role of the PCT and the dynamics between
  organisations.
• How to manage organisations with difficulties.
• Will it encourage inequalities across the SHA?

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Practicalities What should organisations be
doing?

• Testing and modelling.
• Communicating between organisations.
• Learning from each other.
• Foundation Trusts.
• Reviewing internal and external monitoring.
• Linking into Choice work and pilots.
• The overall impact on health economies and
  organisations roles?

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Shall I just leave this to the Accountants?

• Why should non-finance professionals be involved?
• How does it affect commissioning?
• What does it mean to staff on the ground?
• What is important to make it work?

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Conclusion

• Set PbR into the overall strategic context.
• Looked at the aims of PbR and the timescale for
  implementation.
• Looked at the issues for organisations.
• Why non financial professionals should ne involved