Paul Midgley, Director of the Healthcare Partnership, reviews the current state of Practice-Based Commissioning and service redesign in England, and looks at how this will affect companies selling medical equipment.
Earlier this summer, On Target discussed the changes in the English NHS arising from Payment by Results and Practice-Based Commissioning (PBC). Since Anita Baylis’s article appeared in June, implementation of these reforms has gathered pace, and we are now able to see some early indications that PBC groups are planning rapid changes to care pathways – which will affect your sales.
In essence, PBC is a way of engaging local GPs and other care providers to take on more of a role in reducing the need for expensive hospital care, and to provide a wider choice of local (and cheaper) alternative services.
This article examines the early trends and identifies key areas of care where changes are occurring. It also challenges healthcare companies to work as partners with the new commissioners in primary care in order to ensure that they are kept ‘in the loop’ as new pathways and providers arise to develop services.
PBC – the background
The deadline for practice engagement in PBC, set for the PCTs by the Government, is the end of 2006. Implementation has been assisted by the inclusion of an ‘Enhanced Service’ payment in the revised GMS contract, which came into force in April 2006 and applies to all GP practices. This will pay out 95p per patient to practices on production of a PCT-approved PBC business plan, and another 95p per patient in April 2007 for achieving the plan objectives. Given that an averagesized GP practice has nearly 6000 patients, this engagement in the ‘towards PBC’ enhanced service should net practices around £11,500 of additional funds. If there is one thing the Government has learnt about GPs, it is that they respond more positively to a challenge when there is a carrot attached.
A further carrot to engage GPs in PBC is the prospect of practices (or commissioning groups of practices) being able to retain (for reinvestment into services) 70% of any cost savings they are able to make against indicative budgets set by the PCT. These indicative budgets cover the full range of clinical activity costed under the Payment by Results scheme (using 2006–7 PbR tariff prices). These indicative budgets can amount to several hundred pounds per patient, as they take in all prescribing costs and almost all hospital treatment that patients are referred to by GPs.
So an average-sized practice under PBC will have stewardship (on behalf of the PCT) of an indicative budget of around £3m. Savings can only be redistributed to the practice if the local PCT is not in financial deficit. In the case of PCT deficit, the PCT’s statutory duty is first to break even and then to redistribute savings.
Progress to date
A recent survey by the National Health Intelligence Service (www.nhis.info) of 250 Primary Care Trusts looked at progress with PBC, clustering and service redesign. It identified 190 PCTs where PBC ‘clusters’ of practices had formed, and 141 where topics for service redesign or clinical focus were identified in their business plans. The deadline for full engagement in PBC is still some months away, a number of PCTs are in serious financial deficit (though clever use of PBC may be a way out of this), and many PCTs are currently undergoing major structural reorganisations.
These factors may account for the lack of PBC engagement, as other priorities have taken precedence. But by the end of this year, all PCTs will be expected to have engaged practices in PBC to some extent, whether the practices choose to take on an indicative budget alone or as part of a PBC group. Thus we can learn a good deal by examining the 141 ‘trailblazer’ PCTs in more detail.
You must keep your ear to the ground to know who and where your customers are.
The NHIS survey has revealed some interesting information about service redesign intentions, which to some extent overlap with the service redesign themes identified as ‘quick wins’ in the DH PBC guidelines issued to PCTs and practices in February 2006 (see ‘Practice based commissioning – early wins and top tips’, www.dh.gov.uk). The DH’s PBC ‘quick win’ areas are chronic obstructive pulmonary disease (COPD), dermatology, heart failure, long-term conditions, mental health, ophthalmology, orthopaedics, podiatry and urology.
Of particular value in the NHIS survey is the knowledge of where specific projects are already under way. Armed with this knowledge, you can engage with stakeholders in these pilot areas – and by working with these groups across primary and secondary care, help customers in other areas who have not started on the redesign route and are potential key customers in areas of high product usage. The top service redesign themes (with the % of PCTs redesigning the service) from the survey are shown below.
It is unsurprising that reducing unplanned emergency admissions is number 2 in this chart. 60% of the cost of all hospital care comes from patients admitted to hospital as emergencies (i.e. by ambulance, without a GP referral), particularly outside normal surgery hours.
|Top service redesign themes |
|Dermatology (54%) |
Reducing unplanned emergency admissions (43%)
Diabetes/insulin conversion (31%)
Orthopaedics and trauma, COPD, ENT (26%)
Cardiology/heart failure, ophthalmology, musculoskeletal (20%)
Prescribing, referral management (17%)
Minor surgery, urology (15%)
Anticoagulation services (14%)
Long-term conditions (11%)
Mental health, sexual health, general surgery (10%)
The number of clinical pathways being redesigned per PCT varies (in this sample of 141 PCTs) from 32 in Bournemouth to 1 in Herefordshire and Hillingdon. The average number of pathways being redesigned is 5.5. A list of the top PCTs in terms of the number of clinical areas being redesigned is shown on the left.
|Top PCTs |
|Bournemouth 32 |
Doncaster Central 21
Carlisle and District,East Yorkshire 18
Sutton and Merton 16
Nottingham City,Southend on Sea 15
Castle Point and Rochford,Eastern Cheshire, Hammersmith and Fulham, Shropshire County 13
Broadland, Cheshire West 12
Ealing, Richmond and Twickenham, Tower Hamlets 11
Lessons of a PBC pioneer
A typical example of a PCT already engaged in PBC and service redesign is Gedling PCT, located north-east of Nottingham, serving a population of around 100,000 patients. It needs to make 5% savings to break even over 2006–7. Its chosen areas of focus include: reducing emergency admissions; cardiology/heart failure (provision of community heart failure nurses); providing a dermatology GPSI service in a local LIFT health centre; mental health (investment in counselling services); orthopaedics and trauma (using a GPSI to triage orthopaedic referrals and treat in the community whenever possible); pain management (local pain clinics in the LIFT building, reducing waiting time vs. local university hospital, reducing costs); rheumatology (see O+T above); sexual health (developing local expertise among nurses to avoid waiting times in the overstretched secondary care service); minor surgery (through existing local enhanced services).
If you don’t understand how your customers and their operating environment are changing, you run the risk of not taking up opportunities for partnership working and growth – and then losing out as your competitors take up the challenge.
A number of challenges face the Gedling PBC cluster in addition to the PCT deficit. In November 2006, Gedling PCT will be subsumed by Nottinghamshire PCT. Clinical engagement in PBC at individual GP and practice level has been slow, due to the lack of any major financial incentives offered to cover GP and manager time away from the surgery while carrying out the necessary redesign work (which is a major undertaking). Additional factors include the merger of the two major hospitals in Nottingham, which could reduce patient choice, and a lack of drive from local clinical leaders among the GP workforce. In Gedling, most of the drive for PBC pathway redesign has come from the PCT, which is motivated by the need to make savings to offset its financial deficit.
In Gedling, both the soft tissue and the dermatology GPSI service redesigns have been protracted from initial setup to implementation – particularly the latter stage, where one GP had to start dermatology GPSI training from scratch. Such time delays in GPSI training raises the possibility of ‘quick wins’ through the re-siting of existing specialists (at least for part of their time) from their secondary care bases into primary care facilities such as LIFT premises (e.g. for outpatient clinics). Those of you with long memories may remember that a similar shift of provision happened under GP fundholding between 1992 and 1997.
As well as using ‘Practitioners with a Special Interest’ (PwSI) such as extended skilled GPs, it is also likely that PBC commissioners will source the provision of additional ‘secondary care’ services from private providers (e.g. Diagnostic & Treatment Centres), hospital consultants working in chambers (in their non-NHS time) and, increasingly, social enterprise providers (e.g. patient support groups) where existing services are inadequate, and where the alternative provider can meet the required tariff price and quality considerations (as assessed by the PCT).
The focus for the new, larger PCTs, in their role as commissioners, is to assess the needs of the population and commission appropriate (additional) services to meet these needs within budget. This means that existing PCTprovided services will eventually be sold off to other organisations (by 2008, according to ‘Commissioning a Patient-Led NHS’, DH July 2005). We are already seeing this with PCT-led GP surgeries, which are being put out to tender and taken over by a variety of organisations, from neighbouring practices to multinational corporations (e.g. United Health Europe) – and indeed, recent press headlines have greeted the appearance of tender invitations in the Journal of the European Union for businesses to take on the running of a number of NHS provider functions.
Commissioning, provision or both?
GPs have been quick to observe that certain secondary care clinical procedures or packages are currently attractively priced under the PbR tariff, and are within their skill set to perform outside hospital. This is already leading to certain groups of practices coming together to provide services beyond the scope of their existing GMS or PMS contracts where they have the necessary skills and premises.
Practices or groups wishing to set up as providers may do so under an Alternative Primary Medical Services (APMS) or Specialist Personal Medical Services (SPMS) organisation structure, or through the more traditional company models such as Company Limited by Guarantee, Company Limited by Shares (both private and public) and Limited Liability Partnerships. A good example of such a group is in Epsom, Surrey, where Epsom Downs Integrated Care Services (EDICS Ltd) has a contract with Epson PCT to provide a number of additional (secondary care type) services under an SPMS contract. Many GPs in Epsom are both members of the local PBC commissioning group and shareholders in EDICS Ltd, which has its own facility to provide surgical and diagnostic services.
So the Government has really opened up opportunities for entrepreneurial primary care practitioners and other private providers to reshape both commissioning and provision of services, and to break the traditional monopoly of the major hospitals. In response to this increasing competition, five years from now we can expect all hospitals to have Foundation Trust status and be providing services not only within the hospital but in a variety of community settings – which means you must keep your ear to the ground to know who and where your customers are.
Quality Assured Patient Pathways
As commissioners, it is the primary duty of PCTs to ensure that new providers meet the strict quality and governance standards to become approved providers (and earn a place in the ‘Choose and Book’ referrals booking system now operating in GP practices).
A recent publication by the Royal College of General Practitioners aims to help new primary care based commissioners focus on quality – which, given the financial imperative of cost savings, is critical to ensure that the additional capacity is as good as the existing (secondary care based) services and not just a cheap substitute. Current secondary care providers may take heart from this document, as it shows that the new providers have a huge amount of work to do in order to prove that they are capable of commissioning quality-assured services.
The whole process of service redesign, from conception to delivery, can take well over a year. Already busy GPs will tackle service redesign in a highly-focused, prioritised way, looking for as much assistance as possible. The sting in the tail for secondary care providers is that PCT commissioners will also be more stringent in applying these quality tests to existing providers, which may require some trusts to raise their game.
|Recommended Steps |
|Overall needs, requirements and analysis |
•Service design idea
•Evidence for change
Contracting and implementation process
•Introduction of change
•Service specification and implementation
•Pathway provider performance
•Care location and environment
•Access to care
•Corporate governance and probity
The recommended steps – some of which you may be able to help PCTs with – are shown on the right.
How medical equipment companies can help
Many of the new commissioners in PBC groups, and many new providers, are only now developing the skills required to effect the necessary changes – conducting health needs assessments, writing business cases, etc – and could benefit from the expertise in these areas that companies such as yours can provide.
The NHS in England is undergoing a transformation that may change what your customers do and where and how they do it, especially in the hospital sector and especially if your therapy area is one of those highlighted in the NHIS report (see above). If you don’t understand how your customers and their operating environment are changing, you run the risk of not taking up opportunities for partnership working and growth – and then losing out as your competitors take up the challenge.
If your company has these skills in-house and has an interest in the therapy areas undergoing redesign, there is a great opportunity for you to approach the new commissioners and providers and work together to build new primary care based pathways of healthcare. If you do not have the skills and knowledge to assist your customers, make sure that you identify a partner organisation to guide you and ensure that you make the most of these opportunities.
If you would like to know more about the range of training and support services that the Healthcare Partnership provides to PBC commissioning groups, and to healthcare companies supplying the NHS, please contact Paul Midgley on 0870 2413506 or email@example.com