quality in a cold climate - king's fund · [j.wennberg, bmj, october 2002] ... – the...

©The King’s Fund 2010

Quality in a Cold Climate

Candace Imison, Deputy Director of Policy

Mark Jennings,Director of Health Care Improvement

Martin Land, King’s Fund Associate

BLP Event 26th April 2010


£15 to £20 billion


Future Funding Prospects

+2%

- 2%

We will protect 95% of the NHS budget

We are committed to real-terms growth in the NHS.

We will match the current government’s spending plans for the NHS


Workshop Summary

Decomposing the financial ‘gap’Overview of potential strategic responses

Explore four strategies– Priority setting– Workforce– Quality improvement– Reconfiguration

Implications for action – at different levelsQuality in a Cold Climate programme summary


Decomposing the financial gap


NHS Spending

+4% pa

+7% pa


Time

Rea

l ter

ms

spen

ding

(2

009/

10 p

rices

)

2001/2 to 2010/11

2011/12 to 2013/14 on

The Gap

The Gap

COST & DEMAND PRESSURES

PRODUCTIVITY IMPROVEMENTS

£105bn


NHS funding gap by 2013/14

£21billion Shortfall if no real rise 2011/12-2013/14 and noproductivity improvement

£126billion NHS funding needed in 2013/14 to meet Wanless NHS ‘vision’

£1.8bn

£0.4 bn B

£12bn

£1.6bn

£3.5bn

£1.4bn

Improve quality

Clinical governance

Demand drivers

Capital

Real pay and prices

Waiting times


What has happened to productivity?

Productivity = ratio of outputs to inputsBased on indices, to take account of changes in volume (not value) and quality adjustment

NAO (2010) estimate that:from 1995 to 2008 productivity fell by 3.3 per cent, an annual average decline of 0.3 per cent– output grew by 69.3 per cent, with an average annual increase

of 4.1 per cent – inputs grew by 75.1 per cent, with an average annual increase

of 4.4 per cent – productivity fell by 0.7 per cent in 2008, compared with a fall

of 0.3 per cent in 2007


What has happened to productivity?

The Centre for Health Economics at the University of York (2009) reported that:

Between 2003/4 and 2004/5 input growth was matched by output growthSince 2005 (up to 2007/8) there have been productivity gains, with output growth exceeding input growth– More patients treated with improved quality of care – Slowdown in staff recruitment and the use of agency

staff


Potential Strategies – Overview


Range of strategies

If the shortfall is not bridged by:Reduced real spending in all other departmentsIncreased taxation

The focus will be on:Constraining growth in costs and demandImproving productivity, via:– Allocative efficiency: doing the right thing, i.e.

allocating resources for maximum health gain– Technical efficiency: doing things right, i.e. reducing

unit costs, producing more outputs for given input, or same output with fewer (cheaper) inputs


Strategies for improving productivity

Technical EfficiencyMedicines managementQuality improvement techniquesWorkforce strategiesEstate rationalisation

Allocative EfficiencyPriority settingHealth service reconfigurationDemand management

©The King’s Fund 2010©The King’s Fund 2010

Total PCT Spend 2008/09

Acute

Community

Primary

Other inc Mental Health &

Ambulance

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

Better Care Better Value => 10% productivity gain

DH estimates => 20%-30% productivity gain

?? productivity gain

?? productivity gain

Utilisation review suggests 30% inpatients could be in community

Technical AllocativeOpportunities Opportunities

Investment in primary and community care can avoid use of hospital care

Current duplication of first point of care services

Data source: Audit Commission 2009


Suggested Approach

Brief introduction to the strategy (5 mins on each)– What it is and key issues involved – Opportunities and challenges

Two discussion groups (20 mins)– What contribution could this strategy make?– What obstacles may hinder the strategy?– What could enable implementation of the strategy?

Short plenary feedback (5 mins each group)


Exploring specific strategies

Priority settingWorkforce

Quality improvementReconfiguration


Priority SettingExplicit frameworks for resource allocation– Managing scarcity– Making explicit the trade-offs inherent in allocation and

clinical decisions– Tackling wide variations in spend and intervention rates

Approaches and examples include:– National e.g. NICE technology appraisals and evidence

on procedures of low value– Service areas e.g. Programme Budgeting Marginal

Analysis, comparing spending and outcome by service– Local e.g. ‘prioritisation frameworks’ or ‘weighted

benefits models’


Examples and opportunities

NICE:Reviewed national cost estimates from its published guidance (clinical guidelines since January 2005 and technology appraisals since January 2006)

Estimate that savings exceeding £600m could be made from implementation of its current guidance.

Recognise that this is across settings and some changes may free up capacity rather than release cash

©The King’s Fund 2010 19

Cancer – Inpatient expenditure rate, 2008/9(weighted for age, sex and need - per 1,000 population). Source: DH CAI

(using HES)

There is a 2-fold variation in expenditure between PCTs(adjusting for age, sex and need).

The potential savings are £100M(if PCTs with rates higher than the median reduced to this level).

London

Cancer - AgeSexNeeds standardised cost per 1000 population for PCTs

05,000

10,00015,00020,00025,00030,00035,00040,00045,00050,000

1 11 21 31 41 51 61 71 81 91 101 111 121 131 141 151

PCT

Age

Sex

Nee

ds s

tand

ardi

sed

cost

(£

per

100

0 po

pula

tion)

Total Inpatient Expenditure (£M)

Potential Saving using 50th percentile (£M)

Potential Saving as % of Total Inpatient Expenditure

1,560 100 6.4%

Top 30 PCTs(Lowest Rates)Next 31 PCTs

Next 30 PCTs

Next 31 PCTs

Bottom 30 PCTs (Highest Rates)


Next 30 PCTs

Next 31 PCTs



Next 30 PCTs

Next 31 PCTs



Priority Setting opportunities

No systematic approach at a local level in the NHSMethods being developed: transparent assessment of value for money for different interventions E.g. Prioritisation frameworks and weighted benefit models, ranking options by ‘cost per point of benefit’

E.g. Norfolk PCT – Priority Setting

1. Determine benefit criteria2. Weight the criteria3. Score each programme

against criteria4. Calculate weighted benefit

score5. Combine with cost data to

generate cost-value ration6. Rank in order of cost-value

ratio7. Discussion of results


Priority setting challenges

Comparison of different interventions and disease areas –units to measure health benefit

Information and data quality– Completeness and comparability of current data– But opportunity to use new PROMs (Patient Reported

Outcome Measures) data

Ensuring appropriate engagement– Priority setting requires stakeholder engagement– to enable value-driven assessment of options


Workforce scale and opportunities

Opportunities include:Improving productivityRestraining pay growthChanging skill mix

Reducing costs of:Agency costs – exceed £1.3bn nationally and use varied widelySickness – absence rates vary twofoldRecruitment

NHS England: 1.4m staff (headcount), 1.2m Full Time Equivalent (NHS Information Centre 2010)

Workforce costs exceed 70% of expenditure for provider servicesOver £4.8bn spent annually on training


Examples of rising workforce costs

Non-medical staff costs rose by approximately 36% in 5 years 2003 to 2008 (NAO). And Agenda for Change built in pay increments not linked to performance

The new consultant contract led to a 27% increase in pay from 2003 to 2006, with no link to workload, productivity or quality (base salary or incentives)

The new GMS contract led to a 58% increase in pay for GP partners in the first 3 years– No cap on % income taken as profit– Opt out of services, hours work fell 7 hours per week– productivity and morale fell


Workforce strategies (A)

New ways of working– redesigning or re-profiling the workforce– demand driven and focused on outcomes– Use of NHS Institute Productive Series e.g. use of the

Community Services module has led to a 25% increase in the number of visits for a typical team

Driving value from current contractual frameworks– local agreements– linking increments to performance and attendance– NAO reviews of the Consultant Contract and Agenda for

Change (NAO 2007, 2009) recommend action to generate greater value, e.g. by linking consultant job plans to local service ambitions and patient feedback


Workforce strategies (B)

Non-financial incentives– evidence that staff are motivation to deliver high quality

services– engagement driven by being valued and involved– approaches such as Service Line Management have the

potential to give clinical teams greater authority and accountability

Improved workforce planning and development– underused tool to drive up productivity– enable new ways of working and develop leadership capacity


Questions:

What contribution could this strategy make?

What obstacles may hinder the strategy?

What could enable implementation of the strategy?


Quality improvement


Recommended examples

•Atrial fibrillation - detection and optimal therapy in primary care.•Fractured neck of femur: rapid improvement programme.

•Stroke pathway: delivering through improvement.

•The productive ward..•Electronic blood transfusion systems.

•Enhanced recovery for elective surgery.


Wennberg

“Variations in Care are often idiosyncratic and unscientific with local medical opinion and local supply of resources appearing more important than science in determining how medical care is delivered”

[J.Wennberg, BMJ, October 2002]


Unjustified variations in health care cause…..

Increased cost

Reduced quality


Percentage of patients admitted on the day of operation

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

Acute hospital trusts

Better Care, Better Value Indicators

[Source: NHS Better Care, Better Value Indicators]

http://www.google.co.uk/imgres?imgurl=http://www-images.warwick.ac.uk/fac/sci/wimrc/about/collaborators/nhs_institute_logo.jpg&imgrefurl=http://www2.warwick.ac.uk/fac/sci/wimrc/about/collaborators/&usg=__Pw1nbJDFPCauHHOnggccvTv1ngE=&h=301&w=917&sz=105&hl=en&start=1&itbs=1&tbnid=OUCxS3WyNqzKFM:&tbnh=48&tbnw=147&prev=/images?q=NHS+Institute&hl=en&gbv=2&tbs=isch:1�


Prescribing

[Source: NHS Better Care, Better Value Indicators]


Challenges include:

Complexity and uncertainty of evidenceReplicating at scale what has worked elsewhereAchieving pre-requisites:– Strong clinical engagement and senior leadership– Developing a wide coalition to deliver an improvement– Ensuring skills in change and project management are

available


Reconfiguration

Proposals to make ‘substantial change’ to the pattern of health service provision, often relate to:– Concentrating secondary care and relocation– Integrating or designing new pathways– Shifting care settings

Claimed benefits vary, but may include:– Improved clinical outcomes– Workforce development, utilisation and critical mass– Financial savings


Reconfiguration opportunities

Reducing oversupply of acute beds and hospital sitesClinical benefits e.g.– The ‘clinical cases’ made by National Tsars– Specific services e.g. stroke and trauma– Benefits of specialisation – the positive association

between volume and outcomes (e.g. as cited in Healthcare for London: a framework for action)

Linked to:– estate rationalisation– shifting care from hospitals into community settings


Reconfiguration evidence and challenges (A)

Economies of scaleEvidence does not suggest that creating larger units through mergers in itself will reduce costsEconomies of scale maybe exploited at relatively small scalePlanning delays and managerial attention given to organisational mergers

Shifting care settings Unlikely that major cost savings can be achieved by shifting care out of hospitalsRisk that more local access induces more demand– unmet need or lower thresholds– E.g. evidence that devolved outpatients and minor surgery by

GPSIs supplements not substitutes for existing services


Reconfiguration evidence and challenges (B)

Volume and outcome relationshipMany studies have found a statistical link between the volume of work a hospital or clinician carries out and good clinical outcomesBut caution is required, e.g.:– Most evidence for specific interventions, e.g. Surgical procedures, not

to hospital function– Risk of confounding factors, e.g. introduction of new treatments in

larger hospitals – Potential to harness volume effect without reconfiguration e.g.

protocols and clinical networks

ProcessesLengthy and complexConsume much senior management and clinical timeLong timescale to realise claimed benefits


Learning lessons: IRP's verdict on why reconfiguration proposals have been referred:

inadequate community and stakeholder engagement in the early stages of planning change the clinical case has not been convincingly described or promoted clinical integration across sites and a broader vision of integration into the whole community has been weak proposals that emphasise what cannot be done and underplay the benefits of change and plans for additional services important content missing from the reconfiguration plans and limited methods of conveying them health agencies caught on the back foot about the three issues most likely to excite local opinion - money, transport and emergency care. inadequate attention given to responses during and after the consultation.


Questions:

What contribution could this strategy make?

What obstacles may hinder the strategy?

What could enable implementation of the strategy?


Implications – who might need to do what?


Action at all levels of the systemLevel Role Actions

DH Define the rules of the game

•Review quality standards & waiting times•Capital investment levels•Constraining pay settlements•Setting tariff and incentives

SHAs Set the tone for local health economies

•Focus on a Care gap not a financial gap•Quality care is efficient care

PCTs Doing things right and doing the right things

•Systematically set priorities and decommission •Demand management•Prescribing practice

Trusts Improve operational efficiency

•Workforce productivity•Reduce variations in care


Quality in a Cold ClimateProgramme


Quality in a Cold Climate

PurposeAims to help the NHS respond to the quality and productivity challenge Analysis and advice on the scale of the financial challenge facing the health service and the implications for action

ApproachesPublications – papers and briefingsConferences and seminarsOnline resources, blogs and signposting


Work in progress includes….

NHS funding gap: analysis and optionsExploring how boards are preparingWorkforce productivity and measurementProductivity in mental healthService reconfigurationDemand managementInvolvement in QIPP related work, e.g. Establishing the Evidence

quality in a cold climate - king's fund · [j.wennberg, bmj, october 2002] ... – the...

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