Primary Care Orthodontics in PDS: The Good, the Bad and the Ugly

1
Primary Care Orthodontics in PDSThe Good,
the Bad and the Ugly

• Richard Jones,
• Orthodontic Study Day,
• June 20th 2007

2
About Me

• Specialist Practitioner (Total Orthodontics)
• Hon. Secretary of Orthodontic Specialists Group
  (OSG)
• Chairman of Orthodontic Practice Committee (OPC)

3
The Good

• Problems with GDS
• Principles of the PDS contract itself

4
The Bad(problems)

• CACVs and historic earnings (Budgeting)
• Transitional Issues

5
The Ugly (Ongoing disputes)

• Low CACVs and treatment need
• Completion of old GDS cases and DoH formula

6
A Fistful of UOAs

• Managed Clinical Networks, managed referrals and
  secondary care

For a Few UOAs more.

• Moving towards local commissioning and future
  negotiations

7
The Good..The principles of the contract Itself
8
The Old GDS Contract

• Orthodontic Practices are remunerated under a GDS
  (General Dental Services) contract which is the
  same as that used by dentists
• Item of Service type system
• Based on Statement of Remuneration
• Payment via FP17 form

9
Problems with old system( for practitioner)

• Overly complex.
• Payment for treated cases is in arrears (apart
  from interim)
• Can be 2 years or more in arrears!
• ..this causes problems with concept of using
  historical earnings as baseline
• Unpredictable income streams

10
Problems with old system( for commissioning
bodies)

• Different Fees claimed for similar cases
• No restriction on treatment.tendency to a
  culture of over-prescription in terms of
  treatment need
• No capping of funding
• Inequitable provision and residual areas of
  treatment need

11
New PDS Contract
12
Basic Underpinning Principles

• Same as General Dentists Contract
• 3 year income protection
• Calculated Annual Contract Value (CACV) based on
  historic earnings Oct 1st 2004-Sept 30th 2005
• 12 monthly payments
• All clinicians with current GDS contract

13
Pilot Schemes

• Bedfordshire
• Cheshire

14
Principles of PDS Contract

• Will be a 5-year contract (PCT factsheet 8
  paragraph 13.2 and 20.3)

15
Principles of PDS Contract

• Contract is for ongoing management of agreed
  caseload for duration of contract
• Contract will be for X assessments and Y case
  starts per year
• Plus ongoing management of cases in treatment and
  retention
• No additional fees for breakages/repairs
• Elimination of different fees per case

16
GDS v PDS

• Fee per item
• Payment to complete case
• Staggered payments

• Not fee per item
• Payment is to provide a service for duration of
  contract
• Includes assessments, starts plus ongoing care of
  cases
• Not payment to complete case

17
How are targets established for a contract
value?The Concept of the Unit of Orthodontic
Activity (UOA)
18
Units of Orthodontic Activity (UOA)

• Need to allocate some value to activity so that
  appropriate targets could be set.
• Levels the playing fieldsame fees per case for
  each orthodontist
• Assessment 1 UOA Treatment 20 UOAs
  Interceptive treatment 3 UOAs
• Contract will be for a certain number of UOAs
• Value of 1 UOA at Oct 2005 55

19
Case TreatmentsComprehensive Treatment for
patients over 10

• 20 UOAs (plus 1 for assessment)
• Includes further diagnostic, mid-treatment and
  post treatment records
• Includes retention
• Includes all breakages (av. 2 per case-DPB)
• More demanding cases?
• More clinical time, more materials

20
Monitoring of New PDS Contract

• Far more stringent monitoring
• First 20 cases plus 10 thereafter
• Scored by PAR assessment

21
Index of Orthodontic Treatment Need

• IOTN will be introduced nationally
• Patients assessed according to functional and
  aesthetic criteria
• Functional 1-5
• Aesthetic 1-10
• Functional scores of 4-5 deemed to have high need
  for treatment
• Scores 1-2 low need
• Score 3 only deemed in need of treatment if
  aesthetic scoregt5

22
The Good

• For PCTs/DoH
• Capped funding
• Treatment rationing to address treatment need
• Elimination of over-prescription

• For providers
• No payment in arrears
• Regular income stream

23
The Bad

• CACVs and historic earnings (Budgeting)
• Transitional Issues

24
Low CACVs

• CACV based on historic period Oct 1st 2004-Sept
  30th 2005
• Based on all payments received
• UOAs ONLY based on clinical payments
• Except commitment pay
• Uplifted by 2.5 to 2006/2007 levels
• So whats the problem?

25
Low CACVs

• Payment for orthodontics under GDS in arrears
• Exams, records paid 1 month in arrears
• Interims (approx 20) paid 3 months after start
• Remainder paid on completion
• Retention paid at end of retention
• COMPLEX EQUATION!! May take 3 years plus for new
  orthodontists income to stabilise
• DPB payments over a certain period do not relate
  to activity over same period
• In general historic earnings are a poor indicator
  of activity in orthodontics

26
Will PDS funding be enough to fulfill need?
In the year ending March 2004, the annual
expenditure on orthodontic treatment under the
GDS increased by 14.3 per cent from 119.0
million the previous year to 136.0 million.
There has been an upward trend for annual
expenditure on orthodontic treatment since 1992
27
Will PDS funding be enough to fulfill need?

• Current orthodontic budget 170M (2003-2004)
• (135M GDS and 35M secondary care)
• Studies suggest 50 of 12 year olds are IOTN 3.6
  or above
• Studies suggest 1/3 of 12 year olds are IOTN 4 or
  5
• 1/3 of 12 year olds are IOTN 3.6 and above and
  WANT treatment

28
Will PDS funding be enough to fulfill need?

• Demographics suggest 12 year old population of
  England and Wales is 673,768
• This leaves 336,884 12 year olds in need of
  treatment and at least 224,589 in need and desire
  of treatment
• Current PDS funding for complex cases is on
  average 1155-00 per case (higher in secondary
  care)
• At just 1155 per case, national funding of about
  237 M would be required (cf current 170M)

29
Economic FactorsOrthodontists per head of
population

• UK 15th out of 17 countries in Europe (1 per
  73,333)
• Only Spain and Turkey worse
• Iceland, Norway, Germany and Austria top the
  table ( all less than 1 per 30,000)
• Average 1 per 59,000

30
Use of historic earnings as baseline

• Low CACVs for growing practices
• Inadequate budget nationally
• Areas with poor provision not addressed

31
Economic FactorsExample 1 Total Orthodontics
Sevenoaks-A Growing Practice

• Year 2004/2005
• Historical earnings 117,000 approx
• 2004/2005 159 case starts 74 case finishes
• Caseload at transition 315

32
Economic FactorsExample 1 Total Orthodontics
Sevenoaks-A Growing Practice

• At funding level of 117,000 under PDS
• Approx 600 referrals p.a.
• Funding for 53 case starts ( cf 159)

33
Low CACVs and growing practices

• This problem has been recognized by the DoH who
  stated in previous correspondence to the PCTs
  (gateway document 4449 paragraph 7.5)
• It is important to reassure new orthodontic
  practices that, when the reforms are introduced,
  the value of work commenced under the general
  dental services but not yet completed and
  therefore not reflected in payment history, will
  be reflected in the practices contract value.

34
Dispute Resolution

• Local Negotiation First
• NHS Dispute Resolution Procedure via NHS
  Litigation Authority (NHSLA)
• Sign contract Subject to dispute
• Findings of NHSLA legally binding on PCT

35
Judicial Review

• May 2007
• GDP in Hillingdon
• Awarded 0 CACV
• Case supported by BDA

This demonstrates that, in cases where a dentist
has no activity during the test period and where
an unreasonably low contract value has been
awarded, its possible to infer that a PCT has
not had adequate regard to all the
circumstances. BDA May 2007
36
Transitional Issues Transfer between Contracts

• Old GDS Contract pays in arrears on fee-per-item
  basis
• New PDS contract will pay currently for
  orthodontic service
• What about cases in treatment and work completed
  on these cases?

37
Payment for work completed

• Numerous ways of tackling problem
• Individual assessment of every case
• Agreement of global fee for all cases
• Logically in an established practice, every pt is
  50 through treatment..but
• Longer appts at start of treatment
• Material costs front loaded
• Agreed figure to pay for work completed but not
  paid for 70 of active cases and 50 of
  retention cases

38
What about the missing 30?-Has the UOA value
been uplifted to include completion of old cases?
39
GDS v PDS

• Fee per item
• Payment to complete case
• Staggered payments

• Not fee per item
• Payment is to provide a service for duration of
  contract
• Includes assessments, starts plus ongoing care of
  cases
• Not payment to complete case

40
The missing 30

• Strategic Commissioning of Primary Care
  Orthodontic Services (Gateway 7105)
• 9.3 The average case cost under the old
  arrangements was 800, and this has moved to
  approximately 1200

41
The missing 30

• Orthodontic Hints and Tips document
• It takes into account also the 30 for funding
  the completion of cases started in the GDS
  (Referring to the 55 UOA value)

42
The missing 30

• Continuing care of ongoing cases is included as a
  principle of PDS
• This will always be the case in any contract year
• Original UOA value based on analysis of pilot
  studies
• DoH statements re case value very misleading
• It has NOT been inflated by 30 to pay for
  completion of GDS cases

43
The Ugly (Ongoing disputes)

• Low CACVs and treatment need
• Completion of GDS cases/DoH formula

44
Future Growth

• Strategic Commissioning of Primary Care
  Orthodontic Services (Gateway 7105)
• 4.1 Orthodontic capacity varies around the
  country and reflects historical decisions by
  practitioners about where to practice. As in
  other areas of health services commissioning,
  PCTs should undertake needs assessment to inform
  priority setting and planning. This should take
  into account appropriate dental public health
  advice (annex 1)

45
Needs assessmentBased on 2003 Child Dental
Health Survey

• 35 of 12 year olds have need for treatment (plus
  8 already in treatment)
• Misleading research 58 of parents of 12 year
  olds with need did not feel that their children
  needed orthodontic treatment ?
• Based on this DoH advice to PCTs is that need
  will be substantially less than 35...less than
  half this figure
• This will dramatically underestimate need

46
Low CACVs and completion of old GDS cases

• Old cases paid at 70 at point of transition
• What about funding completion of GDS cases if the
  CACV not appropriate?

47
Low CACVs and completion of old GDS cases

• Factsheet 11 Section 2.1
• Where a dentists activity has been growing and
  the CACV does not fully reflect the current work
  in hand, the NHS should, as a matter of
  principle, seek to fund the completion of all
  current cases

48
Low CACVs and completion of old GDS cases

• Factsheet 11 paragraph 5.2
• The CACV accounts for an income over a 12 months
  period. Based on the same assumption that the
  average cases takes 18 months to complete a
  stable orthodontic practice will therefore have a
  total GDS value of approximately 1.5 times the
  CACV

49
Low CACVs and completion of old GDS cases

• Amount outstanding

TOTAL value of cases in treatment and retention
1.5 x CACV
minus

• Fee for complete care
• Includes retention/repairs
• Includes assessments and records

• Fee for treatment only and some retention
• No repairs
• No assessments and records

X 30
50
Suggested modified formula
TOTAL value of cases in treatment and
retention Fee to reflect repairs over average
treatment duration Fee to reflect
assess/records over av. Treatment
duration Retention adjustment
1.5 x CACV
minus
X 30
51
Calculate Excess caseload

• Acceptable caseload is 1.5 times case starts
• Under GDS, fee to complete cases excess to CACV
• Remaining GDS fee 244.47 (average case)
• Retainers _at_ 30 32.50
• Supervised Retention (100) 55.70
• Breakages _at_ 2 per case 95.90
• Total 428.57

52
Example Practice H

• CACV 459,484 UOAs 8144
• Historic Case starts 448 Finishes 365
• After assessments, remaining UOAs 6284 UOAs
• Equivalent to 299 case starts (cf 448 in historic
  period)
• Caseload at transition 669 (note 1.5 times
  historic case starts)
• In retention 353
• Acceptable caseload for ongoing treatment under
  new contract 1.5 x CACV
• 1.5 x case starts under new contract 1.5 x
  314 450 approx.
• Excess caseload 219 approx
• Excess retention 54.

53
Example Practice H

• Total Value of WIP based on claims submitted at
  transition 609,704
• (Note THIS IS NOT CLOSE DOWN PAYMENT. THIS IS
  VALUE OF CASES IN TREATMENT AT 100)

54
Example Practice H

• DoH calculations based on factsheet 11 formula
• Total Value of work in progress (1.5 x CACV) x
  30 -23,856!
• Alternative calculations
• Fees outstanding to complete treatment on
  patients outside CACV 95, 208

55
How to identify a growing practice
1.5 x CACV
TOTAL value of cases in treatment and retention
minus

• Fee for complete care
• Includes retention/repairs
• Includes assessments and records

• Fee for treatment only and some retention
• No repairs
• No assessments and records

If positive figure then practice is growing!!!
56
Is your CACV appropriate?

• Look at start/finish ratio in historic period?
• Caseload at transition. Is it significantly
  higher than 1.5 times case starts under PDS?
• Consider carefully any offer or lack of offer by
  PCT to complete excess cases

57
A Fistful of UOAs

• Managed Clinical Networks

For a Few UOAs more.

• Moving towards local commissioning and future
  negotiations

58
Managed Clinical Networks and PCT Managed
Referral Systems
59
Managed Clinical Networks

• DoH devolution of responsibility to a local level
• To affect primary and secondary care
• Evolution of LOCs
• Geographical boundaries may not reflect PCT
  boundaries
• Constitution and Remit has been drawn up by OPC
• Involvement of PCTs and LDC
• Represented at LDC
• Local strength and co-ordination
• Mutually beneficial to PCTs and Providers

60
Managed Clinical Networks

• 2 different models
• First based on LDC type constitution
• Second on Orthodontic Sub group of OHAG (based on
  Sussex model)
• Reflects views and interests of primary and
  secondary care

61
Organisational Chart
62
PCT Managed Referral Systems

• Strategic Commissioning of Primary Care
  Orthodontic Services (Gateway 7105)
• 8.2 PCTs are advised to put in place a central
  arrangement to receive referrals for orthodontic
  treatment
• A clinical assessment may need to be made
  before the appropriate service can be identified

63
Rationale

• More effective use of resources
• Monitoring nature of referrals (to agree local
  protocol)
• Data collection
• Review waiting lists and direct patients
  accordingly
• Eliminate multiple referrals
• Discourage referral of mild cases

64
Problems

• Restriction of patient choice
• Restriction of dentist choice
• GDP understanding of IOTN
• Patient/parent right to an opinion
• Vulnerability of self-financed businesses

65
Future negotiations and beyond.

• Renegotiation and UOA values
• AssessmentStart ratio
• IOTN threshold

66
Future negotiations UOA values Strategic
Commissioning of Primary Care Orthodontic
Services (Gateway 7105)

• Future commissioning decisions are not covered
  by the transitional arrangements and it is for
  the PCT and the contractor to agree the
  appropriate value for the contract
• 55 is not a national going rate
• Quality framework in place will provide quality
  assurance

67
Future negotiations UOA values

• Strategic Commissioning of Primary Care
  Orthodontic Services (Gateway 7105)
• 9.3 The average case cost under the old
  arrangements was 800, and this has moved to
  approximately 1200

68
Fees for average case under GDS

• FCA and records 73.95
• URA/anchorage/HG/func () 69.53
• Full fix upper and lower 615.00
• Retainers x 2 108.50
• Retention 55.70
• Breakages (2 ) 95-90
• Treatment on referral 73.80
• TOTAL GDS FEE 1110.07

69
Future negotiations.

• The 800 figure quoted is extremely miusleading
  as it includes ALL cases including simple
  removable cases which are not typical of 21 UOA
  cases
• Similarly average value per case is not 1200
  under PDS as many cases are treated for 3 UOAs.
• The average value of comparable cases are very
  similar under either system

70
Future negotiations and beyond.

• Renegotiation Pack for BOS and PCTs
• OSG Session at BOC
• Commissioning Body Talks

71
Conclusion
1 The nPDS contract itself is fair and in
general is a considerable improvement on GDS
72
Conclusion
2 ..but problems exist due to -Inappropriately
low funding levels -Poor planning by
DoH -differences between nature of GDS (item of
service) and PDS -misleading advice concerning
UOA values cost per case
73
Any Questions?jonesrichard_at_ntlworld.com