GPS TO KEEP ALL COMMISSIONING SAVINGS

15 Dec 2004 03:45 PM

GP practices will be able to keep up to 100 per cent of any savings they make from the direct commissioning of services, Health Minister John Hutton revealed today. The move to encourage GPs to directly commission care could reduce prescribing costs, slash unnecessary hospital admissions and create savings for investment in local practices.

Draft guidance on Practice Based Commissioning, published in October, proposed that GP practices would be able to retain 50 per cent of any savings from provision of care they commission.

However, today's final guidance allows GP practices to share in a greater proportion of any savings, with the exact percentage set locally between individual Primary Care Trusts (PCTs) and GP practices.

GPs must re-invest the savings in developing or providing services for patients. Options for re-investment include more specialist care, diagnostics, equipment, facilities and staff.

Under the Practice Based Commissioning scheme, GP practices will be incentivised for conducting x-rays, tests and outpatient consultations within their practice or commissioning these services from another provider.

John Hutton said:

"We want GPs and their practice staff to be encouraged to shape services around the needs of patients.

"There are real signs that practices are exploring the potential of this scheme and several are already involved in practice based commissioning in some way.

"By allowing practices to retain up to 100 per cent of any savings, we aim to encourage even more practices to adopt the scheme, which will free up resources and provide a greater variety of services for patients."

Dr James Kingsland, Chairman of the National Association for Primary Care (NAPC), said:

"There are many advantages of a practice based approach. Practice Based Commissioning allows clinicians and managers to tailor services to the needs of practice populations.

"The local knowledge a practice has about its population cannot be underestimated. Practice Based Commissioning empowers practices to support patients, who may be socially isolated, as well as those experiencing illness, in very practical ways, thereby avoiding unnecessary hospital admissions."

The introduction of the scheme could lead to more patients receiving care closer to home and minimise the number of patients being sent for unnecessary hospital treatment.

For example, a patient with back pain could be scanned using equipment in their local health centre and diagnosed without having to be referred for a hospital examination. If the patient's condition proved to be to a slipped disc, the GP could then prescribe appropriate treatment from a local physiotherapist.

From April 2005, every practice will have the right to hold a practice based commissioning budget. Participating practices will receive a paper or 'indicative budget' from PCTs that they can use to directly manage delivery of services for their patients.

Involvement in the scheme is voluntary, although the Department of Health expects all practices to be involved in practice based commissioning by 2008.

-ends-

NOTES TO EDITORS:

1. The 1998 White Paper, The New NHS, stated that "over time, the Government expects...PCTs will extend indicative budgets to individual practices for the full range of services."

2. The NHS Improvement Plan, published in June 2004, indicated that "from April 2005, GP practices that wish to do so will be given indicative commissioning budgets."

3. The draft practice based commissioning guidance is available at www.dh.gov.uk .

4. GPs and other stakeholders were actively invited to share their comments following the publication of draft guidance on practice based commissioning in October 2004.

5. Where a practice requests the right to an indicative budget in April 2005, that budget will be based on historical spend for the year 2003/04 with the appropriate uplift. Because it is an indicative budget, overspends will be met by the PCT. However, a practice that has claimed the right to hold an indicative budget will be expected to balance the budget over a three-year cycle. If they are unable to balance their budget they will forfeit the right to hold an indicative budget except in exceptional circumstances.

6. Two practice based commissioning case studies can be found in Annex A.

Annex A

Case Study 1 - Darlington PCT

Darlington PCT is clear about the potential benefits of
practice-based commissioning, especially the opportunities it brings to build commissioning decisions on sound clinical data and on the detailed knowledge GPs have about the needs of their own patient populations.

However, implementation of practice-based commissioning in Darlington will not be a big bang affair for the 11 practices on the patch.

The watchwords here are collaboration and, to some extent, caution. The approach is one of starting small; moving forward together; and using practice based commissioning to make tangible and sustainable improvements in patient pathways right across primary and secondary care.

Carole Harder, Director of Primary Care at the PCT explains: "In Darlington some practices have had experience of fund-holding - but this needs to be different.

"Typically under fund-holding, the emphasis was on reducing waiting times and moving contracts between different acute providers. However, with the introduction of the 18-week target from referral to treatment, practice led commissioning can focus more on redesigning patient pathways.

"It will encourage us to develop a detailed picture of which services GPs are referring to and what's happening to the patient at each stage in the pathway," she says. "But for all this to happen, we need to open up a much closer commissioning dialogue between the practices and the PCT."

As a key strand of this closer dialogue, a new Commissioning Forum is under discussion. This would bring together a clinical lead from each practice, Carole herself, the PCTs commissioning directorate and acute trust representation.

"As a PCT we can bring a wealth of commissioning expertise to the table - something which most practices don't yet have, " says Carole. "But what we don't have is the practice-level detail of what is needed for individual patient populations. It's the GP who knows, for instance, whether MRI waits are holding up patients in the orthopaedics system.

"What we need to do now is set up the structures and systems which will bring all this expertise together and the Commissioning Forum will be central to this."

For the first year, the PCT is encouraging practices to work in partnership and focus on areas where they can make the quickest and largest impact.

According to Carole, however, there are other important factors that make the partnership model a sensible option for now.

"Practices are currently very involved in getting to grips with the new GMS/PMS contracts and the Quality and Outcomes Framework. The introduction of patient choice will also be another issue for practices to address. Moving forward together means we can share some of the load and, crucially, some of the risk," she says.

But also, because the PCT envisages practice based commissioning as a route to pathway redesign right across the system, Carole stresses the need to have maximum impact on the way secondary care services are delivered.

"This will be much easier if practices sign up to the changes they want as a group, rather than trying to change the system as individual organisations."

One of the early tasks ahead for the Commissioning Forum would be to develop good clinical data mechanisms to underpin commissioning decisions.

"We want to establish some baseline data which will tell us more about what services GPs are referring into, the types of conditions being treated and which patient groups are involved," adds Carole.

"From there we'll identify areas that need more detail, such as when diagnostic tests are being carried out and what waits patients are experiencing at each stage in the pathway.

"With practices using several clinical systems, this could be a challenge - but good clinical data is at the heart of good practice based commissioning and we'll need to work hard to get this right."

For Hilton Dixon, a GP at Denmark Street Surgery in Darlington, good data collection can be achieved, but recording activity, keeping it accurate and up to date will mean more work for practices and GPs.

He says, "We have come across similar issues before with fund-holding, but this is seven years on. We will need PCT support in co-ordinating and validating data and in managing financial flows - but this is one of the benefits of moving forward together in partnership with the PCT and it will enable us to learn from each other."

According to Dr Dixon, working as a group will also make it easier to bring down some of the boundaries between primary and secondary care.

"We've tended to function in silos, but practice led commissioning will only work of we strengthen our links with secondary care and develop services together - it's a case of evolution not revolution," he says.

While he acknowledges that practice based commissioning is not without pitfalls - one of these being the risk of overspending - he feels the potential benefits are compelling.

"The central force behind practice-based commissioning is more and better services for the patient. There's enough evidence out there to suggest this is achievable so we have to go into this with an open mind."

Case study 2 - East Devon PCT

East Devon PCT already has six of its 13 practices fully signed up to practice based commissioning, with another two in the pipeline.

This represents a strong start, not least because the PCTs approach has been to develop a flexible scheme where practices are free to take control of their budgets at a time and level that feels right for them.

According to Beverly Stretton-Brown, Project Manager for Devolved Budgets at the PCT, developing the scheme has been about recognising that each practice was coming to this with different levels of expertise and enthusiasm.

"Some practices have previously been involved with secondary care commissioning and managing budgets and it's given practices a head start - mainly in terms of confidence and recognising the potential benefits of managing budgets at practice level," Beverly explains.

"Some practices will be natural leaders on practice based commissioning, but others will be more focused on the new primary care contracts and want to get to grips with these first."

While the flexibility of the scheme is designed to accommodate a staggered uptake of practice based commissioning, the strong push towards more community-based services in East Devon means devolved budgets are clearly the way forward for this rural PCT.

"Geographically we are a wide-spread PCT with one main acute provider for a population of 116,000. For the last three years we have had a big drive towards improving access for patients through developing more local services closer to where people live," says Beverly.

Other factors have also strengthened the case for moving toward practice based commissioning, including a growth trend in secondary care activity and the newly acquired foundation trust status of the acute hospital - meaning Payment by Results has been operating in full since April 2004.

"Payment by Results does create a more appropriate environment for practice based commissioning because funding will follow the patient," adds Beverly.

"But at the same time this means it's more important than ever for practices and the PCT to understand what secondary care services we are using and what these are costing us.

"GPs are in the best position to know what services their patients need. Practice based commissioning is about enabling, empowering and providing incentives for them to think more about referral patterns understand the underlying cost implications and use this data to explore how things can be done differently to benefit the patient."

The PCT has taken a phased approach to setting up the new scheme. Year one (2003-04) was a foundation year where the PCT paid practices a small amount to carry out validation work on referral data. At this stage practices were encouraged to think about how they recorded referrals so the data was accessible for validation at a later date.

This year, the focus has been on setting indicative budgets for each practice - based on their highest spend over the previous three years - and setting up mechanisms to provide practices with monthly budget statements as well as detailed secondary care activity data at patient level.

"Successful practice based commissioning depends heavily on the information coming down to practices - so we've invested time and resources in this area," adds Beverly.

Supported by an existing Information service, shared between PCTs in the area, East Devon has established a system to convert existing data feeds from the NHS-Wide Clearing System (NWCS) into monthly budgetary statements for each practice.

These are sent to every practice alongside a more detailed file showing each charge for inpatient and day case elective activity and inpatient non-elective activity that has been attributed to the practice budget. This can be analysed at patient level, enabling GPs to validate data against their own knowledge and records of each patient's pathway.

Although indicative budgets and regular budgetary information are provided to all 13 practices - only those who are formally signed up to PLC will benefit from the financial incentives enabling them to use 50 per cent of any savings for reinvestment in patient services. The other 50 per cent will be retained by the PCT to cover overspends and further service development activities.

GPs have recognised that investment and resources are needed at practice level to manage practice based budgets. As well as support from Beverly and a devolved budgets facilitator, GPs have also asked for resources that will allow them to dedicate extra time to managing the system.

As a result the PCT is working with practices to develop a set of cost management activities, including clinical review of referral activity and data validation - the latter currently representing the biggest expense for most practices.

An important feature of the East Devon model is that the management costs incurred by practices to run the scheme will be offset against the total savings before they are split between the practice and the PCT.

"This means both the PCT and the practice are investing in management resource from the secondary care budget," explains Beverly.

Dr Phil Taylor, GP at Axminster Medical Practice, one of the practices already signed up to PLC, stresses that while validation will be critical to the process of service redesign under practice based commissioning, it must not become a black hole for time and resources.

"We need to ensure we are not losing ridiculous amounts of time checking what we have been charged against what we have used. This is time that we need to be investing in developing new and better services for patients.

"But our early validation activities are showing some discrepancies and the immediate challenge are to ensure that payment by results and the tariffs and coding it uses are sophisticated enough to support practice-based commissioning."

Dr Taylor can however see clear benefits for patients on the horizon - especially in bringing down some of the traditional barriers between primary and secondary care and promoting closer collaboration between GPs and acute specialists based on shared values and "enlightened self interest".

"This early work has already led to the development of a locally-based fracture clinic within this locality," he says.

"And cardiology is another example where things could really change. We are keen to look at new models that enable many of the diagnostics to be done in community settings. The consultant will only need to get involved at the point where their specialist skills are really needed.

"Overall, devolved budgets will mean we are no longer working within the confines of traditional practice budgets. They will give us the freedom and the potential savings we need to make real changes for our own patients in our own communities."