The empowering care models described in the previous chapter showed how citizens can be given greater control over their health and care in practice, and how this can produce better outcomes and help the NHS with its financial challenge. However, these innovative models of care remain at the margins of our health and care system. Too few patients and communities have benefited from them. This chapter looks at what can be done to spread these best practice models across the system.
7.1 Changing how money flows around the NHS
One obvious lever for encouraging the spread of these models is money: a significant proportion of the new money promised to the NHS should be dedicated to funding new models of care and the way money moves around the system needs to change so that healthcare providers have incentives to do things differently.
A transformation fund
Money can be a significant driver of change, especially when offered on a quid pro quo basis for the reforms set out in this paper. This was one of several drivers of improvements in care between 1997 and 2010, where funding for the NHS more than doubled while performance targets, particularly in the acute sector, ensured that services changed (Boyle 2011).
The problem going forward is that similar increases in funding are no longer possible. The NHS, which has historically required annual increases in funding of about 4 per cent, received just 0.9 per cent more per year during the last parliament (Charlesworth 2015). For this parliament the government has pledged to fill Simon Stevens’ £8 billion funding gap which will relieve the pressure to some degree, but this still leaves the service requiring a £22 billion productivity improvement.
Policymakers should resist the temptation to sink the additional funding into crisis management and day-to-day running costs, and should instead invest much of it in a ring-fenced transformation fund to help deliver the reforms set out in this paper. There are four main reasons why such a fund should be created.
1. Reform should be the number one priority of the service going forward
The £8 billion funding gap set out by Simon Stevens will grow larger if the NHS doesn’t increase its annual productivity gains from its historical average 1–1.5 per cent to 2–3 per cent (Roberts 2015). This is an unprecedented challenge which requires fundamental service redesign.
2. Reform costs money
Many of the reforms set out in this paper include costs over and above the running costs of the existing services. This has been recognised through the creation of a £200 million Vanguard Fund – and through commissioning for quality and innovation (CQUIN) payments – however, the figures available through these channels are insufficient (Hopson 2015). Furthermore, commissioners and providers have no access to other forms of finance such as equity finance, and public dividend capital is only available to organisations in financial distress. IPPR will shortly be publishing an analysis showing how large such a transformation fund would have to be to drive the reforms discussed.
3. Existing funding channels are insufficient for these kinds of reforms
Even if existing sources of finance such as the national tariff and CQUIN payments were increased to recognise the scale of reform needed, these mechanisms would be insufficient. Reform costs are distinct in nature. Notably, many of the costs are one-time sunk costs associated with changeover, or pump-prime investment, where the savings garnered as a result of reform are not accrued in year. For example, the integration of health and social care may involve double running costs (Gilburt et al 2014) and empowerment based on technological changes will require investment in the new equipment necessary to drive them forward. This would make both tariff and CQUIN payments insufficient as they require a return within the year. Likewise, many of the investments breach the silos between different types of care: channelling funding down existing routes would re-enforce these silos rather than breaking them down.
4. It will help ensure that the best models spread
A transformation fund of this kind can also ensure that payments are linked to the delivery of specific models of service reform which demonstrate the most potential. Put differently, it will help ensure that ‘a thousand flowers’ (NHS 2014a) do not bloom. Indeed, the fund can have a unique role in acting as a store of institutional memory on best practice, and of making sure the best advice, guidance and support is offered to reformers, something currently missing from our health system.
Now the case for a transformation fund is well established, we turn to its specific characteristics and functionality. This is a topic which the King’s Fund and Health Foundation are researching in detail at present based on past experience. However, here we set out some key criteria and principles which we can establish at this stage.
First, as implied by the analysis above, the transformation fund must be of sufficient size to really catalyse the reform agenda. As such we recommend that the new fund should house at least half of the new money – some £8 billion – promised to the NHS by the current government.
Second, unlike the Better Care Fund, this funding must be additional to that already allocated in the NHS’s core budget. This is important because although we recognise that by diverting some of the additional £8 billion of funds away from day-to-day running of the NHS, short-term performance targets may deteriorate, the Better Care Fund demonstrated that taking funds from existing budgets absolutely guarantees it (McKeon 2014). Furthermore, reallocating funds, as undertaken to furnish the Better Care Fund, causes bad feeling and resentment, not the best way of starting a reform drive.
Third, this fund should be independently administered by a board of politically neutral experts in health and care transformation. This will avoid any perception of political partiality in the allocation of funds, prevent raids on the fund during future NHS crises which has been a significant problem with past NHS funds (Edwards 2014) and potentially allow more politically sensitive reforms, including the closure of hospitals to drive preventative healthcare, to receive the green light. It would therefore be more akin to the Independent Trust Financing Facility or the King’s Fund/the Nuffield Trust than the Better Care Fund or Vanguard Fund.
Fourth, the fund should have clear and transparent criteria regarding who can access funds; how much each project can access; on what basis: and for what kind of transformation. These details are the kind of questions which will be addressed by the work being undertaken by the Health Foundation and the King’s Fund. However, it is clear that the fund should focus on three key parts of the transformation agenda, by administering finance through three distinct channels: integration, technology and empowerment/prevention. Meanwhile, given these themes we tentatively suggest that potentially only health and wellbeing boards are eligible to apply for funding given that they are the only organisations which cover the whole health economy and therefore cross care silos.
Fifth, while the fund should be open to local innovation – that is, this should not be an attempt to centralise power – funding should be focused on best practice reform and should be rigorously evidence-based where possible. The fund should have the remit and resources to collect, collate and promote best practice as established by the Pioneer and Vanguard sites, and push new reformers towards these models. It should, therefore, act as a store of knowledge and a mechanism through which to ensure that we have a coherent and efficient health system once the transformation has occurred. Furthermore, clear outcome targets should be set for the beneficiaries of the transformation fund to ensure that the finance is being set wisely and delivering the biggest transformation for the investment.
Finally, it is crucial that this fund is given this remit for a significant time frame. Transformation will not occur quickly and part of its value comes from its ability to circumvent the existing (short) commissioning in the NHS. We believe that it should outlast the current parliament as a minimum, and political parties should guarantee upfront that it will receive from fund replenishment in any future financial settlements. This will give providers and commissioners the confidence and ability to drive forward long-term reform.
The payment mechanism: changing how money flows around the NHS
The previous section discussed how specific pots of money – outside the main NHS budget – can be offered quid pro quo in exchange for reform at the local level. However, the amount of money available to NHS providers and commissioners through this mechanism is always going to be limited especially when compared to the amount of money these commissioners and providers receive through existing channels. To really drive reform across the service this wider pot of money must be transferred to providers and commissioners in a way which encourages rather than stifles empowerment and wider service reform.
How providers are paid in the NHS
There are broadly four different mechanisms by which the transfer of money from commissioner to provider can occur.
- Block budget: A prospective lump-sum payment is made at regular intervals to the provider for all healthcare services, independent of the number of patients treated and the amount or quality of activity undertaken.
- Capitation-based payments: Prospective lump-sum payments are made to a provider or a network of providers per enrolled patient, for a range of bundled, specified services.
- Case-based payments: Providers are paid a fixed sum for an episode of care, based on groupings of clinically similar diagnoses or procedures that entail similar costs. This method involves less bundling than capitation payments, as reimbursement is for an episode of care, rather than a period which may or may not include activity.
- Fee-for-service: Payment is made retrospectively to providers for each unit of service provided, in other words, each activity or patient contact, according to a fixed price schedule.
The way providers are paid is a major barrier to the spread of the kind of models we have described in this paper.
Across the service the majority of providers have moved from receiving payments via block budgets – meaning a lump-sum payment made to the provider independent of the number of patients treated and the amount or quality of activity undertaken – towards payment by results (PbR) (Appelby et al 2012). PbR is a form of case-based system where providers are paid a set price, known as a tariff, for each unit of care provided. This already dominates the acute sector and is being spread into community care, mental health and even some areas of primary care.
However, the shift towards PbR is just one example of the many incentive-based changes made to the payment system: an alphabet soup of payment by performance reforms – where extra payments are made to providers who provide services via specific processes or in a specific location – have also been introduced ranging from the quality outcomes framework (QOF) in primary care, to best practice tariffs (BPTs) and CQUIN payments across the board.
The increase in PbR and process-based incentive payments has had some notable benefits: primarily it has been key in cost control and driving efficiency savings (Farrar et al 2007, 2009, 2010). However, it has several key disadvantages.
- There is no evidence that it has led to increases in the quality of healthcare outcomes delivered by the service (Charlesworth et al 2014; Farrar et al 2007, 2010) and ultimately it is the outcomes and not the processes that matter to patients.
- It makes engaging in shared decision-making and offering alternative prescriptions (social prescriptions) difficult because providers only get paid for prescribing those things included in the tariff set by central government. That is, it centralises rather than devolves decision-making power and therefore keeps power away from the patient.
- It makes the kinds of reform discussed in the previous chapter such as integration and the adoption of new technologies very difficult because money is paid from different budgets in silos (primary care, acute care, community, mental health, and so on). Furthermore, the amount paid is only for each individual episode of care provided, which makes accruing enough money to make the necessary pump prime investments difficult.
There are a range of things that policymakers can do to correct these problems. We articulate two of the most significant: (i) personal budgets and (ii) payment by outcomes.
Personal budgets
One of the best ways of empowering citizens is to give them control of the money spent on their care. Personal budgets are a radical innovation because they challenge the old model of taxpayer-funded public services. Currently the public pay taxes into a collective pot and experts and policymakers at the centre of government decide how that should be spent to meet people’s needs. In a system of personal budgets taxpayers would pay into a collective pot, redistributed according to need in a free at the point of use system, but then they would each be able to access it individually or indeed collectively to shape the care that they want.
Personal budgets have a number of advantages.
- They have the potential to shift power in the system fundamentally away from the large organisations that commission and provide because they give citizens the funds to deploy as they wish (subject to a clinical sign off), considerably enhancing their personal autonomy and independence.
- They should help develop a system that better aligns supply with demand: by giving the commissioning power to the citizen, we are more likely to see the shift towards more community-based and less clinical care that most experts have long called for.
- They may result in a more effective allocation of resources: even though cost savings are hard to quantify from the rollout so far, there is good evidence that they have improved wellbeing and satisfaction for at least the same cost as the old system. Moreover, the larger the budget and the better the process explained through processes of shared decision-making, the better the outcomes.
Research on the impact of personal budgets in social care has shown the following.
- The majority of those with personal budgets report more positive outcomes and wellbeing compared to when they did not have a personal budget. Those with direct payments and individual service funds report better outcomes and wellbeing than those with budgets managed by the council (TLAP 2013).
- Personal budgets have most impact when the person with the budget knows how much they have to spend and there is a wide range of options which could be purchased (Fox 2014 and Forder et al 2012). We explore how more can be done to maximise the potential of personal budgets later in this paper.
After 2009 the Department of Health piloted personal health budgets across 70 primary care trusts covering a range of chronic conditions including COPD, diabetes, long-term neurological conditions, mental health and stroke, and those in receipt of NHS continuing care, maternity care and end-of-life care. The budgets did not include the cost of seeing a GP, pharmaceutical costs or emergency care costs. There is a clinical sign off to ensure that what is proposed meets a person’s agreed health and wellbeing goals.
The evaluation of these pilots found that:
- personal health budgets had a significant impact on care-related quality of life and psychological wellbeing
- they had no effect on clinical outcomes or mortality rates
- the impact was greater where the amount of money available was explained, and there was greater flexibility around how it could be spent and how it was managed
- larger budgets had more positive effects
- there was little difference in overall costs between the personal budget group and the control group, although personal budgets did have lower indirect costs associated with reduced inpatient care
- personal budget holders secured more services from outside the NHS than the control group, with budget holders more likely to purchase wellbeing and specialist health services that are often provided outside the NHS and less likely to use hospital care (Forder et al 2012: 168–170).
The evaluation concluded that personal health budgets were cost effective and supported a wider rollout. From April 2014 all those in receipt of NHS continuing healthcare funding have had the right to request a personal health budget. The NHS Five Year Forward View commits the health service to expanding what it now calls ‘integrated personal commissioning’, starting with patients who have long-term conditions and who also have a personal budget for social care (NHS 2014a).
We believe that to pivot the system towards the kind of empowering models of care set out in this paper we need to accelerate this process. Only by putting greater financial control directly in citizen’s hands can we decisively and irreversibly shift power and control away from clinical commissioning groups (CCGs) and trusts, and push it towards the citizen and their communities. The government has said that in the long term it wants to introduce a right to a personal budget to all who would benefit. We recommend that by 2020 any patient with a long-term condition should have an entitlement to a personal budget if they want one. Hundreds of thousands of patients controlling their own funding in this way, spending it outside traditional medical services in many cases, will be a powerful enabler of change in our model of healthcare.
Payment by outcomes and capitation
The second major payment reform needed is a move towards outcomes-based capitated budgets where outcomes can be defined as ‘the results people care about most when seeking treatment, including functional improvement and the ability to live normal, productive lives’ (ICHOM 2014).
These outcomes should be set through a process of coproduction involving practitioners, commissioners and most importantly patients and the public. Patients included in this process should be determined by effective segmentation of the patient population into groups with similar healthcare needs (either by frailty index or disease pathway) (Corrigan et al 2014).
This has been recognised as a long-term aim in Monitor and NHS England’s 2014 paper Reforming the payment system for NHS services: supporting the Five Year Forward View, but as yet there has been little significant moves in this direction. CCGs in Barnet, Croydon, Camden, Enfield, Haringey, Herefordshire, Islington, Milton Keynes, Northumberland, Oxfordshire and Sheffield have all begun experimenting with payment by outcomes (PbO), supported by commissioning for outcome-based incentivised contracts (COBIC) and outcomes-based healthcare (OBH). Indeed, in several cases these pioneers – notably Milton Keynes – are already delivering results and clearly demonstrating the benefits of PbO in terms of patient empowerment (see COBIC case study).
Case study: COBIC in Milton Keynes
COBIC is one of just three organisations in England developing the PbO agenda through COBIC contracts.
The first COBIC contract was created in April 2011 when Milton Keynes PCT developed and used the COBIC approach to retender its substance misuse service. The previous system had been contracted on a PbR basis despite the fact that in many cases there was little link between inputs and outcomes. Paying providers for activity also created disincentives for them to be innovative in the care they provided as well as protecting siloed service provision.
The chief executive and director of strategy organised a range of engagements and events involving patients, clinicians and commissioners to determine, in an ideal world, what outcomes the service would deliver. This is a clear example of co-design and production which clearly demonstrates the benefit of PbO in terms of patient empowerment.
Having determined the outcomes that patients wanted the NHS to achieve, they gave notice on the existing contracts and issued a much more outcome-orientated contract, giving providers the freedom to innovate in service delivery in order to achieve them. The contract was ultimately given to a third sector provider and ‘the service transformed in weeks, providing measurably better quality and experiences than before’ with care services joining up around the patient and aiming to deliver the outcomes that they wanted most. It led to a 25 per cent saving in the cost of provision.
To shift the wider incentive structure towards the needs and requirements of patients, CCGs should move towards a form of payment by outcomes for most of the care they commission.
This would be facilitated by the following five steps.
- The Integration and Vanguard pilots should be encouraged to implement PbO. These pioneers should be treated as a learning exercise and we should set out specific questions we would like these pioneers to answer covering the nature of best practice, the main barriers to OBH and any potential solutions.
- NHS England and Monitor should set up a joint PbO unit. This unit would have responsibility for supporting the pioneer projects in implementing best practice and overcoming the barriers locally: essentially it would provide the service both COBIC and OBH are providing but throughout the NHS. It would also act as a store of knowledge, learning the lessons from the pioneer projects and leading the long term strategic plan for spreading PbO across the NHS.
- A national commissioning outcome database should be established to support local areas, linked to the outcomes framework and based on best practice established in those pioneering PbO. This could be set up in partnership with COBIC, OBH and ICHOM (the International Consortium for Health Outcomes Measurement) who have already started working on such a database.
- Patient reported outcomes measures (PROMs) should cover all of the main chronic diseases as well as acute procedures. This is challenging, but not impossible to deliver and should be prioritised.
- Monitor, NHS England and the Health and Social Care Information Centre should set out a comprehensive data strategy for the NHS giving clear guidance and targets as to what data CCGs and providers should be collecting to facilitate payment by outcomes.
7.2 Devolving power
Enabling the spread of new models of care will require a power shift at three levels:
- to local places – to enable the shift into empowering people in the community and shifting the locus out of hospitals and into the community
- to frontline healthcare professionals – providing them with the autonomy and flexibility to design care jointly with the citizen
- to patients directly – as with personal budgets.
We have already called for an acceleration of the expansion of personal health budgets. We now turn to setting out the case for devolving more power to local areas and to the frontline healthcare workforce.
‘Devo Health’
The National Health Service has historically been significantly centralised. This is perhaps unsurprising given that it was born out of the ashes of the second world war, which saw an increase in the role of central government across the whole of the UK economy.
However, it is now all too clear that devolution of power and money – or in this case decentralisation – is an idea whose time has come. The recent Scottish referendum – and the promise of ‘devo max’ following its conclusion – has provoked significant discussion about devolution within England. Health and social care is not immune from these developments.
Some warn against this shift. They argue that it will open the NHS up to poor local management, and expose patients to a postcode lottery. However, this argument doesn’t really stack up:
- the postcode lottery in the UK already exists in that we have devolved regions such as Northern Ireland, Scotland and Wales
- this experiment (devolution to the Northern Ireland, Scotland and Wales) has seemingly had little impact on the relative difference in amenable mortality and healthcare outcomes between the devolved regions despite different funding settlements (see Bevan et al 2014).
This suggests that the arguments of the detractors are ill-founded. However, neither is it a strong case for those arguing the converse: that devolution will necessarily lead to a transformation in care at the local level. Indeed, the evidence from devolution to Northern Ireland, Scotland and Wales is that devolution, even combined with increases in funding, had limited impact on healthcare outcomes.
That said, we would argue, as have others that this lack of improvement was largely down to a lack of reform in the way in which healthcare was delivered (see Warner and O’Sullivan 2015). We therefore believe that devolution can lead to efficiency savings and improved outcomes if it is used as a driver of reform. This is something that can, and is being tested out in Greater Manchester following George Osborne’s announcement in February that Greater Manchester would get its own combined health and social care budget.
‘Devo-Manc’
In February 2015 George Osborne announced that Westminster would devolve control of the Greater Manchester’s £6 billion health and social care spend from April 2016.
Responsibility for this new budget will rest with a new Greater Manchester joint commissioning board, with the actual commissioning delegated to the most effective level, under the principle of subsidiarity.
However, this is about more than bringing power closer to home; it is also about driving reform and efficiency savings. Greater Manchester is forecast to have an annual budgetary shortfall for health and social care of £1.075 billion by 2017–18, its share of England’s £30 billion deficit by the end of the decade (ibid). Devolution will help plug this gap by aligning all the levers for improving health at the local level.
This will be key to helping drive forward the integration of health and social care, a major part of the reform programme set out by the NHS Five Year Forward View. It will also enable greater population planning. Notably, the region will target 600,000 of the city’s 3 million people who are considered most at risk of disease progression and hospitalisation. This group will be offered a special personalised care package, with the goal of eliminating at least 60,000 hospital admissions per year. These reforms, catalysed by devolution, are forecast to save around £250 million (ibid).
Going forward we recommend that ‘Devo Manc’ is carefully evaluated to establish whether the reform agenda set out is actually delivered, and does result in budgetary savings while maintaining (or even improving) the quality of and access to care. However, in principle we recommend the creation and expansion of a ‘Devo Health’ programme. More specifically we argue that the government should develop the ‘devolution on demand’ policy which was fleetingly set out in The Implications of Devolution for England (UK Government 2014). This said that in cases where there is ‘genuine demand underpinned by popular support’ regions could ask central government for further devolution. It added that: ‘There would be a presumption in favour of devolution but checks in place would aim to ensure powers were not granted inappropriately. This system could include giving local authorities more autonomy managing their budgets.’
And demand is there: the 10 core cities – Birmingham, Bristol, Liverpool, Leeds, Manchester, Newcastle, Nottingham and Sheffield, Cardiff and Glasgow – recently published A Modern Charter for Local Freedom which set out an ambitious devolution agenda including health and social care. This document also recommended the creation of an independent body to receive proposals for the transfer of freedoms from the centre to local people based on publicly available criteria, and to oversee that transfer. IPPR argues that such a body should be created for the NHS which would be responsible for:
- evaluating and learning the lessons from ‘Devo Manc’
- setting out what values, principles and basic minimums must be retained in the NHS across devolved regions
- setting out criteria for green-lighting further devolution
- receiving and reviewing applications from city regions wanting further devolved powers.
However, we would expect – indeed hope – that devolution settlements would be agreed for most if not all of the 10 core cities by the end of the next parliament.
Frontline autonomy
Empowering models of care rely upon the ability of professionals to use their discretion and adapt the care provided according to the objectives of the person in receipt of that care. This requires a range of flexibility at the frontline that is lacking in many parts of our health and care system: for example, public attention has recently focused on the problems of homecare workers being limited to 15-minute visits to carry out prescribed tasks, when what the person in receipt of care wants is an ongoing, less time-constrained and deeper relationship (see Muir and Parker 2014).
Frederick Laloux argues that this kind of more autonomous frontline is optimised by certain forms of organisational design (Laloux 2014). Organisations which allow workers this space for innovation and professional judgement are likely to have flatter hierarchies, with higher levels of trust and self-management. Staff are likely to be held together and motivated by a sense of intrinsic purpose, rather than extrinsic financial incentives. They will be characterised by innovation and incremental improvement, with workers not waiting for evidence, but rather developing workable solutions, evaluating them and learning from experience.
These ideas have been applied in practice with impressive results in the Netherlands, where two-thirds of community nursing is carried out by Buurtzorg. Nurses are empowered by Buurtzorg to deliver all of the care people need in the home, with locality-based patches and technology-enabling real-time data collection. This means low levels of supervision and administration from the central team, which in turn means higher costs per hour, but a reduction in the total number of hours. This has helped to achieve a 40 per cent cost saving in the Netherlands (De Blok 2013).
7.3 Equipping the healthcare workforce to support empowering models of care
We need not just reforms to finance and devolution of power, but also a very differently configured workforce capable of delivering new models of care and possessing a very different mindset and culture to that of the traditional medical professions.
New roles and skills
The new models of care set out in this paper and in the Five Year Forward View require changes in the healthcare workforce, with a different set of skills, organised around new kinds of roles. To tackle this Health Education England (HEE) will need to think strategically and work with providers to anticipate future trends. The NHS at different levels, working with universities and colleges in particular, will need to put in place the capacity to commission new roles, recruit into those roles, retrain existing workers, and introduce new education and training programmes (see NHS HEE 2015).
Supply and demand are out of sync in the healthcare labour market. With the growth of multiple morbidity and the need to provide people who have complex health problems with a single point of access and navigation through the service landscape, we are likely to require more community-based generalist roles. But it is exactly in this space that there is a growing recruitment crisis: the BBC recently undertook a survey of GPs and found that 56 per cent expect to retire before the age of 60 (BBC News 2015). Figures show that almost one in 10 posts for GP partners are now unfilled, a figure which has quadrupled in just four years (Donnelly 2015). Research by the Royal College of General Practitioners shows that England will need 8,000 new full-time equivalent GPs by 2020. However, nationally only 20 per cent of medical students are choosing general practice, compared to a 50 per cent target (RCGP 2015).
To address this requires a profound rethink of general practice. In order to meet growing demand we are likely to require more support staff, who are likely to be quicker to train than new GPs. Practice teams will require more nurses and physician associates who have undergone vocational training in community-based settings and with skills that will complement those of the GP, such as prescribing and advanced nursing skills. These staff could take on roles such as visiting nursing homes and people with long-term conditions in their own homes.
We will also require more specialists in areas like paediatrics who can be deployed and are trained to work in community-based settings as part of integrated general practice teams.
In order to tackle the social determinants of illness while providing support for people to avoid illness and manage their conditions effectively we are likely to require more advocacy workers and care coordinators. These could be in the form, for example, of estate or neighbourhood-based local area coordinators. Or, as we saw with Age UK’s care coordinators in Cornwall, they could be based in GP surgeries. These roles are likely to require less specialist expertise and more crosscutting skills and competencies such as empathy, communication skills, a knowledge of the social causes of ill health and an ability to work across professional and service boundaries.
It is worth noting that these may not in most cases be ‘new jobs’, but may involve retraining existing staff to take on a wider role. These coordination roles could for example be a progression opportunity for the large healthcare support workforce. According to HEE these band 1–4 roles make up approximately 40 per cent of the non-medical workforce and provide up to 60 per cent of direct patient contact, and yet traditionally receive very little investment in their training and development (NHS HEE 2015).
Culture
The agenda described in this paper requires a profound change in professional mindsets and cultures, particularly so that we can:
- shift from a paternalistic to a coproductive model of care
- shift from a medical mindset to one that gives much greater recognition to the social determinants of illness.
It cannot be underestimated how profound a challenge this is and it is an area in which relatively little progress has been made in recent years. Medical mindsets are deeply embedded, underpinned by clinicians’ understanding of their role that has emerged over centuries of medical practice. Changing this will require the following measures (Nesta 2013b and Ahmad et al 2014):
- practical decision-making tools that will help to guide GPs and specialists through the processes of shared decision-making that are at the heart of coproduced consultations
- training for new and existing professionals, for example in how to conduct proper care planning that starts with the patient’s wider objectives rather than simply clinical aims
- leadership right from the top of trusts and GP practices
- senior clinical champions who will push the agenda among medical colleagues
- a core project team that provides training and support for new care models, in recognition of the fact that it will require a constant push so that professionals get used to new ways of working and do not ‘default back’
- awareness of wider community programmes and initiatives that can facilitate self-management, probably best embedded in a proper referral system as with the Newcastle social prescribing model described in the case study above.
7.4 An adoption and diffusion mechanism for new innovations
Technology is key to handing people greater control over their health and care, but the NHS has a relatively poor record of adopting and diffusing innovative technologies. We need an efficient and effective method of dispersing new technologies such as care planning apps, wearable devices and telehealth and care equipment across the system (Quilter-Pinner and Muir 2015).
Adoption and diffusion of new innovations: performance so far
There is evidence that the UK will have to improve its ability to adopt and diffuse new innovations if it is to reap the benefits of technological advancement. The evidence on this is significantly stronger for drugs than for non-drugs, however there is enough anecdotal evidence to imply that this applies to devices and digital technologies as well.
For example, in its key report on innovation in healthcare, Innovation, Health and Wealth, the Department of Health concluded:
‘Whilst we are good at inventing and developing new technologies, the spread of those inventions within the NHS has often been too slow, and sometimes even the best of them fail to achieve widespread use.’
DH NHSIE 2011
Meanwhile, in a recent report on patient empowerment NHS England backed this statement up for the types of technologies discussed in this paper:
‘59 per cent of all UK citizens have a smartphone, 84 per cent of adults use the internet. However, when asked, only 2 per cent of the population report any digitally enabled transaction with the NHS.’
NHS 2014b
IPPR’s paper Improved circulation: Unleashing innovation across the NHS (Quilter-Pinner and Muir 2015) detailed numerous case studies of innovators who were struggling to achieve dispersion of their product, including VitruCare (see the best practice case study above).
Our research suggests that there are three main barriers to the adoption and diffusion of new technologies across the service that need addressing in looking to drive forward the care planning, technology and data model of empowerment.
Search frictions: how to bring buyers and innovators together
Innovators and buyers within the NHS often have difficulty locating each other. This is a classic example of a search friction, or asymmetric information. There are two main elements to this asymmetry.
On the seller’s side the main problem is the size and complexity of the NHS. The NHS is not one entity but thousands of individual organisations, all of which are potential consumers: NHS England, Public Health England, 211 CCGs, 168 acute trusts, nearly 11,000 GP surgeries and thousands of community providers. Locating the right organisation and individuals within it to complete a transaction is challenging. To address this we recommend that academic health science networks (AHSNs) take on a ‘market matching’ role, grouping together to channel innovators more efficiently into the right people within the NHS: this can be achieved by expanding services such as Innovation Connect and the Innovation Nexus.
On the buyer’s side this information asymmetry surrounds knowledge about the quality and characteristics of a particular innovation. The size of the asymmetry in the healthcare market is particularly large because the issues are highly technical and specialised, and because many products are unusually expensive to purchase. Furthermore, there is another complication for many of the empowerment products discussed in this paper: notably there is limited clear evidence (for instance double blind trials) about their benefits because they are not always appropriate for these evidence collection methods. In looking to address this problem we think that the National Institute for Health and Care Excellence (NICE) should be asked to set out best practice guidance for technology-enabled patient empowerment, building on the results of the Whole System Demonstrator. This would recommend the range of technologies necessary to deliver this model of care.
The principal–agent problem: how to ensure the NHS seeks out innovation
There is a lack of systematic demand for innovation from within NHS organisations; or put more simply, NHS organisations are not looking for new innovations. This, we have argued, is a result of the principal–agent problem – that is, NHS commissioners and providers being imperfect agents for the patient and failing to be innovative enough in the healthcare they deliver.
One reason for this, we argue, is because of the accountability mechanism to which they are subject, which may well lead them to prioritise balancing the budget or minimising risk rather than innovating. The challenge going forward is therefore to increase the perceived risk that providers and healthcare workers attach to a lack of innovation. One way of doing this is by recruiting ‘innovation scouts’ to identify areas where innovation is needed, search out best practice innovations to fill these gaps, and help to bring down barriers to adoption and diffusion. This would ensure that there are people in the NHS who are responsible and held accountable for supporting innovation, and move the service towards a so-called ‘ambidextrous’ organisation model.
Another reason behind the principal-agent problem is an information asymmetry between commissioners and patients. This information gap works on two levels: first, the patient–clinician gap occurs because the patient–clinician relationship has traditionally been a paternalistic one, with the former a passive recipient and the latter an active specialist. Second, this kind of information asymmetry also exists in the gap between the patient–clinician and the commissioner – that is, between care and procurement. The solution to this problem is patient empowerment itself, particularly the spread of personal budgets as discussed above, and the coproduction of care pathways during integration and service redesign initiatives.
Misaligned incentives: how to allow money to flow around the NHS
The third major barrier to the adoption and diffusion of new technologies is the payment mechanism – meaning the way in which money is transferred from central government to local providers, which acts as a disincentive to innovation. Much of this ground is covered in the section on the payment mechanism above, but we will summarise briefly once again.
One of the primary problems with the current system is that it incentivises outputs rather than outcomes (for example a hip replacement rather than the ability to walk). As a result, innovations which achieve better outcomes while also increasing efficiency (reducing healthcare activity) are disincentivised because they reduce the income of the healthcare provider. Our paper Improved circulation highlights several examples of this problem. The solution here is to move towards a system where it is the outcomes themselves that are incentivised. This is discussed in detail earlier in this chapter.
The second aspect of the payment system problem is that it reflects and reinforces the fragmentation that already exists in healthcare provision. Any innovations that seek to move care between these silos – and so call for money to move between silos – are disincentivised or inhibited. The long-term solution to this problem lies in the integration of health and social care with pooled and capitated budgets. In the shorter term, AHSNs and Monitor should look to promote the use of ‘short-term patches’. One of these is the shared savings formula, which sees the savings made by introducing an innovation in one place shared equally by the CCG and provider, or by multiple providers across the health and care system (for example, by a hospital and primary care provider). Another is the flexible tariff or local variation, which allows local CCGs to adjust the standard tariff (set centrally) if the treatment provided by the care provider differs from the standard treatment.
The final key aspect of the payment system problem is that of intertemporal disincentives, which occur when the cost of an innovation must be met upfront yet the savings are accrued at some indefinite point in the future. A main component of this problem is the short commissioning cycle operated in the NHS and the paucity of national investment funds. This problem would be partly negated by the proposal included above to create a transformation fund that would provide funding for technological transformation; other solutions include moving to a longer commissioning cycle and removing the obligation on CCGs to balance their books in cases where deficits are offset against savings at a later date. Finally, AHSNs have a key role in sourcing alternative financing mechanisms including social financing where possible.
7.5 Responsibilities of citizens and wider society
Giving citizens greater control cannot simply be a case of the state handing over power. Citizens themselves will need to take more responsibility for their own health – and, indeed, in some cases for the health of others.
The question of our personal responsibility for our own health is the subject of longstanding debate in medical ethics, covering questions which we do not have the space to address here. Nevertheless, here we briefly set out the contours of that philosophical debate, before elucidating what will be required of citizens if we are to get the most from the models of care set out in this paper.
Unhealthy behaviours: whose responsibility?
The shift in the global burden of disease towards illnesses caused in part or largely by lifestyle factors has put the question of personal responsibility at the centre of public debate. The Global Burden of Disease study shows that poor diet, lack of exercise, smoking, high blood pressure and excessive alcohol consumption are a major cause of illness and disability in the UK. International studies also confirm that healthcare only contributes 10 per cent to preventing premature death, whereas personal behaviour contributes 40 per cent (PHE 2014).
It is clearly the case that we all make choices that affect our health and that we all carry some degree of personal responsibility for these choices. We choose whether or not to buy another drink, to eat takeaway foods or to put cigarettes to our lips. However, it is also true that our choices are not always informed, voluntary, uncoerced or deliberated. Lifestyle behaviours are often partly determined by cultural factors, health literacy, health inequalities, genetic predispositions and, in the case of smoking and alcohol, addictions. Given the complexity of the determinants of lifestyle choices it is hard to make judgments as to where personal responsibility lies, particularly at the level of public policy and particularly without knowledge of an individual patient’s circumstances.
It is also true that we as a society bear some responsibility for ensuring that people live in conditions in which healthy choices are possible. At the national level this can be brought about through the state putting in place public policies which tackle the social causes of ill health and unhealthy behaviours. It can mean the state banning certain activities, which are deemed to contribute to poor health. It can also mean the state deploying the insights of behavioural sciences to encourage healthy behaviour, as we have seen with ‘nudge’-style thinking.
Non-state actors also have responsibilities. For example, companies producing foodstuffs that contain too many calories or too much sugar could help by reducing the energy intensity of these foods or by signing up to more transparent labelling. Employers more widely have a responsibility for promoting healthy lifestyles among their employees. The link between health and work is increasingly well understood: good-quality work promotes better health, and a healthier workforce is a more productive one.
The citizen’s responsibilities
Clearly we all have a responsibility in a collectively funded health system – in which care is always rationed to a greater or lesser extent – to take care of our own health. Our failure to do so imposes very real costs on others. But what happens if we do not? Is there some kind of feasible sanction in such cases? Some have argued, for example, that smokers should be charged for treatment where they have a recurring problem and have refused to quit smoking. However, because of the difficulty of fairly adjudicating where personal responsibility lies and because free healthcare at the point of use achieves greater equality of healthcare utilisation, charging patients for treatment in such cases is likely to produce more problems than it solves.
It is better to increase the disincentives to engage in unhealthy behaviours at the point of consumption, for example by increasing taxes on ‘bads’ such as alcohol. This both provides a disincentive and helps pay for the costs of illnesses related to such unhealthy consumption.
Taxing alcohol
Across the UK there are around 1.2 million alcohol-related hospital admissions per year. Alcohol-related harm costs society £21 billion annually (Home Secretary 2012). Alcohol excise taxes and value added tax (VAT) together make up over half of the price of most alcoholic drinks sold off-trade (alcohol purchased in supermarkets and off-licences) (Griffith et al 2013). However, the current system of excise taxes does a poor job of targeting heavy drinkers who are the primary problem in terms of health. However, the evidence suggests that those who drink heavily tend to purchase stronger alcohol (ibid). This provides us with a mechanism to target taxation more effectively.
We therefore support the proposals made by the Institute of Fiscal Studies (IFS) for a new tax schedule which increases the rate of tax for stronger alcoholic products. The IFS suggests that such a new tax schedule could start at 20p per alcohol unit for wines and spirits of 1 per cent alcohol by volume (ABV), and 7.1p for other alcohol. Both rates would then increase by 0.6p per unit for each 1 per cent increase in ABV (ibid). The impact of this would be to reduce purchases of alcohol in those families who buy less than seven units of alcohol a week by 2.6 per cent on average, compared to 9.5 per cent for those purchasing more than 35 units. This is therefore more effective and efficient than a minimum pricing system.
It is worth noting that the structure of alcohol excise taxes is partly restricted by an EU directive that would prohibit this reform at present (as indeed is minimum pricing as seen in Scotland). One task that faces policymakers in looking to implement this, therefore, is winning support for this reform in Europe, or looking to overcome the legal challenges we might face if implemented. It is also worth noting that pricing policy can only achieve so much. It should be combined with public campaigns to warn of the health risks of alcohol and challenge the binge-drinking culture which has developed.
In addition we should expect citizens to act in ways that support the new models of care set out in this paper. This might include the following.
- First, citizens will need to be fully involved in consultations and care planning. They will need to be better informed about their conditions and how to manage them. To do this they may need to attend courses, as with the expert patient programme, and get involved in peer support groups.
- Second, citizens will need to take up the support that is offered. For example, they will need to comply with social prescriptions that are agreed with the doctor, such as therapies or gym memberships. They will need to work actively to achieve the goals agreed in the care plan. If they do not do this then these models of care will not be effective and will have to be withdrawn.
- Third, citizens will have to share more of their personal data with different public services to achieve the kind of integrated care set out in this paper. For example, they may have to respond to prompts put forward by different agencies or set defaults to allow professionals to access their medical and care records.
- Fourth, citizens will need to be more involved in community organisations and networks of people who support each other. If we are to respond to the epidemic of mental illness, for example, all of us will have to play a more active role in looking out for each other and supporting people at risk of loneliness or isolation.
- Fifth, where they are able, citizens will have to purchase and utilise new technologies such as mobile devices, smartphones and wearable tech that will help them monitor their vital signs and communicate these to their GP or specialist.
7.6 Conclusion
In this chapter we have argued that five systemic steps are required to help empowering models of care to spread: we need a transformation fund to resource these new models; we need personal budgets and payment by outcomes to incentivise change financially; we need to equip the healthcare workforce with new skills and roles; we need to improve the adoption and diffusion of new technologies; and we need citizens to change their behaviours and to take up new responsibilities.