Will these reforms raise administrative costs?
The NHS in England is following the USA, Australia and many countries in Europe in introducing a system of paying hospitals and other providers on the basis of the work they do. Providers receive a fixed payment – the national tariff – for each type of patient treated. Termed “Payment by Results” (PbR), the policy rewards providers for volumes of work adjusted for differences in patient characteristics.
But there have been concerns about the ability of Primary Care Trusts (PCTs) to manage demand and control expenditure under PbR and about the overall administrative costs of the arrangements. The latest edition of Health Policy Matters summarises two studies studies commissioned by the Department of Health, in which staff in hospital trusts and PCTs were interviewed about these concerns.
There are a range of local strategies to deal with managing demand and expenditure, including initiatives to influence GP referral behaviour, improve patient management, and prevent hospital admissions. However, there is little evidence on the effectiveness of these initiatives and there is a need to identify and share best practice across the NHS. To ensure expenditure control, it is likely to be equally important to refine the incentive structure underpinning PbR, including consideration of how tariffs are calculated and whether activity thresholds should be introduced.
PCTs and hospital trusts have seen their administrative costs increase by £90k-£190k because of PbR. Most of the additional expenditure is due to recruitment of additional staff. Although the move to PbR has entailed a reduction in some types of administrative costs, notably price negotiation, this is more than offset by increased expenditure on other things. The main cost driver has been the increased information demands of moving to a patient-based payment system.
The main changes in administrative costs are:
- higher costs of negotiation. While there are lower costs in negotiating prices and volumes, this is offset by difficulties PCTs have in managing activity levels, because Trusts no longer have to get approval to expand their activity, thus making it more difficult for PCTs to live within their budgets.
- higher costs of data collection, due to PbR’s requirement for accurate patient-level data. Some of these costs are down to IT investment, but many are driven by organisations taking on staff to ensure better extraction of data directly from case notes rather than summary forms.
- higher monitoring costs, because the financial consequences of changes in activity are more significant and because PCTs need to verify that the type of activity – particularly the HRG allocation – is accurate.
- higher enforcement costs, with the sharper relationship between activity and income/expenditure increasing the potential for more disputes between Trusts and PCTs
But PbR has brought benefits, and there was consensus among all those interviewed that the PbR system was preferable to previous contracting arrangements, partly because PbR had sharpened incentives and introduced greater clarity into the contracting process. In addition, interviewees indicated that PbR had led to improvements in the process of care delivery, by enabling resources to be shifted across settings, because of the improved specificity of information, and by highlighting where service improvements might be made.
Andrew Street | alfa
How Strong Brands Translate into Money
15.11.2016 | Kühne Logistics University - Wissenschaftliche Hochschule für Logistik und Unternehmensführung
Demographic change depresses tax revenues
04.11.2016 | Fraunhofer-Institut für Angewandte Informationstechnik FIT
Among the general public, solar thermal energy is currently associated with dark blue, rectangular collectors on building roofs. Technologies are needed for aesthetically high quality architecture which offer the architect more room for manoeuvre when it comes to low- and plus-energy buildings. With the “ArKol” project, researchers at Fraunhofer ISE together with partners are currently developing two façade collectors for solar thermal energy generation, which permit a high degree of design flexibility: a strip collector for opaque façade sections and a solar thermal blind for transparent sections. The current state of the two developments will be presented at the BAU 2017 trade fair.
As part of the “ArKol – development of architecturally highly integrated façade collectors with heat pipes” project, Fraunhofer ISE together with its partners...
At TU Wien, an alternative for resource intensive formwork for the construction of concrete domes was developed. It is now used in a test dome for the Austrian Federal Railways Infrastructure (ÖBB Infrastruktur).
Concrete shells are efficient structures, but not very resource efficient. The formwork for the construction of concrete domes alone requires a high amount of...
Many pathogens use certain sugar compounds from their host to help conceal themselves against the immune system. Scientists at the University of Bonn have now, in cooperation with researchers at the University of York in the United Kingdom, analyzed the dynamics of a bacterial molecule that is involved in this process. They demonstrate that the protein grabs onto the sugar molecule with a Pac Man-like chewing motion and holds it until it can be used. Their results could help design therapeutics that could make the protein poorer at grabbing and holding and hence compromise the pathogen in the host. The study has now been published in “Biophysical Journal”.
The cells of the mouth, nose and intestinal mucosa produce large quantities of a chemical called sialic acid. Many bacteria possess a special transport system...
UMD, NOAA collaboration demonstrates suitability of in-orbit datasets for weather satellite calibration
"Traffic and weather, together on the hour!" blasts your local radio station, while your smartphone knows the weather halfway across the world. A network of...
Fiber-reinforced plastics (FRP) are frequently used in the aeronautic and automobile industry. However, the repair of workpieces made of these composite materials is often less profitable than exchanging the part. In order to increase the lifetime of FRP parts and to make them more eco-efficient, the Laser Zentrum Hannover e.V. (LZH) and the Apodius GmbH want to combine a new measuring device for fiber layer orientation with an innovative laser-based repair process.
Defects in FRP pieces may be production or operation-related. Whether or not repair is cost-effective depends on the geometry of the defective area, the tools...
10.01.2017 | Event News
09.01.2017 | Event News
05.01.2017 | Event News
16.01.2017 | Trade Fair News
16.01.2017 | Automotive Engineering
16.01.2017 | Life Sciences