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y The 2009 budget and the NHS Chris Ham, Editorial 29 April 2009 Professor of Health Policy and Management and Policy and ManagementHSMC, University of Birmingham

Primary care represents a greater challenge because practice-based commissioning has not achieved the level of genuine engagement among general practitioners and others that is needed.

Weaknesses in commissioning are the biggest threat to efforts to improve NHS performance. Time is running short for these problems to be dealt with

The bottom line is that NHS organisations should be scare by the prospect of an era of austerity unlike anything experienced in recent history. Having overcome their fright, they should act decisively to engage doctors in the quest for changes that both save money and improve outcomes.

The NHS organisation that inherit the future will be those that focus their attention on the people who are responsible for spending most of the resources provided for health care and support them to make the necessary changes at the front line of care.

Chris Ham, Professor of Health Policy and Management Policy and Management, Health Services Management Centre, University of Birmingham

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y Introduction: key pathway to system reform or policy cul-de-sac?

Voluntary scheme introduced in 2005, one of the cornerstones of government health policy reform

Aims ill defined: objectives wide ranging and non-specific:• To encourage clinical engagement in service redesign and development• To improve the quality of services for patients• To enable better use of resources

Widespread view that not yet lived up to expectations or delivered intended benefits:• Few PBC-led initiatives; most small scale, local pilots focussing on provision of hospital

services in community settings• Little impact in terms of better services for patients or more efficient use of resources• Little interest in wider commissioning activities• No evidence that PBC can be a mechanism for achieving widespread change

Fundamentally PBC is underpowered and the incentives are weak

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y The local picture is one of relatively good progress

PBC cluster structure

Strong and credible cluster leadership

Dedicated resource at cluster level

Fair shares resource allocation

Tracker surveys show majority of GPs supportive of principles of the policy though this has not translated into active engagement

More collaborative working relationships among GPs, opened up lines of communication between GPs and PCT, and GPs and hospital staff, GPs and community staff

Risk of enthusiasm waning because of lack of tangible progress in terms of improved services for patients

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y Key barriers to progress have been identified

Roles and responsibilities• Local flexibilities have led to tensions

between GPs and PCTs• No common vision for PBC at the local

levelCapacity and capability• Limitations on GPs time • Lack of some core skills • PCT inability to deliver the substantial

support requiredData• Lack of reliable timely data to develop

ideas or manage budgets

Relationships• Issues with communication, information,

prioritisation and trustGovernance and accountability• Financial and clinical risk• Few levers available to PCT to hold PBC to

accountConflicts of interest• Conflation of PBC with GP own provision

and risk of perception of subverting choice• PCT support of community servicesWider context• Poor quality relations between GPs and

government

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y The future of practice based commissioning in NHS Nottinghamshire County

In its current form PBC clearly not operating effectively; progress has been slow and risks stalling completely

DH seeking to “reinvigorate and redefine” the policy

Not much detail but elements likely to include:• Multi-layered matrix model of successful PBC • Continuum of earned autonomy• High performers rewarded with increased independence• More freedom and stronger incentives to innovate

No central blueprint and PCTs will be able to establish their own PBC “escalator” arrangements

Any PBC escalator must support progress in World Class Commissioning

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yThe PBC escalator is a formalised “give and get” compact between PBCs and the PCT.

The “give”: The “get” in return might be: 

Contractual accountability for national/ local objectives

Greater delegated authority over budgets and ability to commit resource

Greater strategic contribution Greater autonomy over “operational” commissioning

Population health focus Dedicated and embedded managerial support

Cluster governance (including accountability to local population

Access to FESC

Duty of partnerships (especially with community services and social care)

Flexibilities on planning cycle/financial accounting period

Financial balance and risk sharing Flexibility around FURS (what is can be used for and 70/30 split)

Clinical quality (including access) Access to capital / joint (integrated care) venture opportunities

Access to PBC “innovation” fundsPBC Escalator: Greater autonomy and entitlements are traded for greater accountability, greater responsibility and achievement.

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y(Baseline) Level One Level Two Level Three Level Four

Scope of PBC

Hospital contracts and budgetsMinimum take contractsNon NHS contractsPrescribingPBC & management costs

Community servicesPsychological therapiesPrimary care education and trainingStrategic initiative (SI) alignment at local levelVital signs (VS) alignment at local levelNSR alignment at local levelNew ( “enhanced”) primary care service contracts

GP contracts Mental healthAmbulance servicesSupport to PCT specialist commissioning processes

Non-GP independent contractorsJoint commissioning

Commissioningcompetencies

Use of cluster level PH outcome measures to drive service change and improvementBasic financial and analysis skillsProvide clinical engagementWork collectively with partners on commissioning, reform and redesignBasic governanceCommitment to CQI

Clinical leadershipDemonstrate competencies in re-design and implementationUse of data to manage demand and lever change in clinical behavioursUse of data to underpin PCT/ cluster VS and SIProgressive governance frameworkProgressing PPI and engagement strategy and decision makingManagement of conflicts of interest in procurementJoint work with social servicesCluster OD plan

Contractual accountabilityCluster Board developmentDetailed use of performance data Business development strategyPartnership workingRisk management and pooling arrangementsComprehensive PPI in decision making

Acting a principal system manager for local health and social care partnershipsCross locality budgetary management capabilities

PCT support

Implementation of fair sharesTimely and accurate clinical and financial dataIndicative budget covering agreed scope of servicesAgreed governance and accountability arrangements with practicesBusiness case approval <150K within two weeksManagement and staffing support from PCTQuarterly list size and demographic adjustment

Decision on 95% business cases <150 K within a month of submissionProvide monthly accurate , timely management information (cluster defined) Risk poolingDedicated staff and supportPBC integrated into WCC modelProgramme of OD to support cluster developmentPCT support when dealing with providers

Decision on 100% business cases < 250 K within a month of submissionDelivery of PCT strategy via locality model

Extensive programme of OD to develop system level skills and knowledgeProvision of staff support

PBC freedoms, incentives and powers

Baseline management allowanceBusiness case approval limit <100K100% savings retainedConsultation regarding PCT business planning

Enhanced management allowanceBusiness case approval limit <150KService agreement model to devolve and embed commissioning management supportPBC involvement in PCT business planningAdvice on management of capital Oversight over prioritisation and locality spend of out of scope services

Hard HCHS hard budgetBusiness case approval limit < 250K Management of capital

Hard full/combined HCHS/GMS budgetICO environmentPBC management of network of providers for locality

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yThe PBC escalator is underpinned by the following core principles

• Clusters will start at the platform level (level 1), and only move through the levels when the requirements are achieved with regard to PBC competencies and PCT support, and signed-off by the PCT

• PBCs acquiring greater autonomy must be accompanied by an accountability framework for delivery of PCT targets, including budgetary control and the priorities of the Strategic Plan

• The scope of budgets delegated to the clusters will be negotiated jointly and will reflect their aspirations and competencies. They will be set fairly, transparently and in collaboration with the clusters

• Clusters will work with their practices to manage their resources within the delegated budgets• Risk sharing arrangements will be required between the PCT and the clusters• The concept of “influenceable spend” should underpin accountability and that whilst PBC clusters may hold

substantial indicative budgets they may wish to “block back” certain of the budgets and accountability to the PCT . The increased scope to manage budgets and influence will change over time

• Demand management initiatives will be taken forward by the PBC clusters and the PCT in partnership, particularly around budgets that are not directly “influenceable” by PBC

• That PBC has a role in overseeing the quality of primary care, areas of service redesign, bringing care closer to home and the associated primary care education programmes.

• That a comprehensive, timely and accurate financial and information report will be developed with clusters and practices

• Metrics will be developed reflecting national requirements with further discussion of “must do’s” and the contribution of PBC

• Training and other support will be available from the PCT to clusters in financial and other governance responsibilities

• An assurance programme will be required to ensure the PCT is in a position to assess requests to move up a level.

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y“The trick that has to be accomplished is to harness the energies of clinicians and reformers in the quest for improvements in performance that benefit patients. Succeeding needs reformers to develop a better appreciation of the organisations they are striving to change, and clinicians to acknowledge that change is needed.”

Chris Ham