World Class Commissioning in the NHS Elizabeth Wade Senior Policy Manager (Commissioning)

1. World Class Commissioning in the NHS Elizabeth Wade Senior Policy Manager (Commissioning) SSRG Annual Workshop – 20th April 2009

2. Overview • Commissioning in the NHS • The World Class Commissioning Programme • What do we know about effective commissioning? • Priorities for practice development, policy and research • Questions

3. What are PCTs? • Primary Care Trusts (PCTs) are statutory NHS bodies • 152 across country serving average population of 330,000 • Funded directly by the Department of Health with average budget of £527m p.a. • Accountable to Strategic Health Authorities

4. What are PCTs? Responsible for ensuring access to health services, and improving health outcomes for people in their area by: • Commissioning health (and social care) services • Providing health services (usually community health services, sometimes mental health and learning disabilities) • Working in partnership with other local agencies

5. What is healthcare commissioning? Process by which organisations: • Assess the healthcare/health improvement needs of their local population and review how well existing service provision meets those needs • Identify priorities for investment and design services/identify opportunities to meet the needs • Acquire these services/create opportunities through contracts with a variety of service providers including GPs, NHS Trusts, Foundation Trusts, third sector and independent sector organisations, and partnerships with other agencies • Ensure the services are provided effectively, and monitor quality and outcomes

7. Who does healthcare commissioning? • PCTs (hold the statutory responsibility) • Practice-Based Commissioners • Specialised commissioning teams • Local Authorities (through pooled budgets, joint commissioning arrangements etc.) • Care managers/coordinators • ? Individual service users (patient choice, personal budgets)

8. Why do we need commissioners? • To act as an advocate for patients and custodian for taxpayers • To ensure NHS planning and provision is needs/demand-led, not supplier-led • To address the challenge still facing the NHS to simultaneously improve: • Service responsiveness and performance • Patient experience • Efficiency and value for money • Public/population health outcomes

9. Perceptions of healthcare commissioning “… we have concerns about the implementation of the [Next Stage Review], which will be the responsibility of PCTs, because we doubt that most PCTs are currently capable of doing the task successfully. As we have noted in a series of inquiries, PCT commissioning is too often poor. In particular, PCTs lack analytical and planning skills and the quality of their management is very variable. This reflects on the whole of the NHS: as one witness told us, "the NHS does not afford PCT commissioning sufficient status". We consider this to be striking and depressing”. Health Select Committee - January 2009

10. “Kids, you tried your best and you failed miserably. The lesson is, never try” The conclusion of two decades of commissioning in the NHS?

12. World Class Commissioning • Programme developed and launched in 2007 • Significant involvement of/ ‘co-production’ with the NHS • High profile within the Department of Health • Assurance process initiated 2008

13. World Class Commissioning The programme Vision and competencies Assurance framework Support and development tools

14. Competencies

15. Competencies

17. Assessed through a combination of. . . • Self-assessment and certification • Feedback from partners (including local authorities) • Evidence and data review • Panel assessment day (including a local authority panel member)

18. 102 Frequency 1 2 3 4 1. Locally lead the NHS 2. Work with community partners 3. Engage with public and patients 4. Collaborate with clinicians 5. Manage knowledge and assess needs 6. Prioritise investment 7. Stimulate market 8. Promote improvement and innovation 9. Secure procurement skills 10. Manage the local health system Source: 152 panel scores as of 31 January 2009 (post national calibration)

19. The potential impact of WCC World class commissioning has the potential to deliver more than 25,000 years of healthy life expectancy … if the PCTs that prioritised the following outcomes bring their performance up by a quartile, it will result in the following impact over 10 years: • Smoking quitters: an additional 3,600 life years gained and 5,000 quality-adjusted life years gained • Diabetes management and stroke care: an additional 20,000 life years gained and 20,000 quality adjusted life years gained Mark Britnell, Director General Commissioning and System Management, DH - February 2009

20. What do we know about ‘world class’ commissioning? “Experience and available evidence from Europe, New Zealand and the US indicates that in no system is commissioning done consistently well. To be sure, there are examples of innovation and ‘good practice’ in all systems, but equally there are examples of the limits to effective commissioning and the barriers that have inhibited commissioners from negotiating on equal terms with providers. Why is health care commissioning so difficult? The answer can be found in the complex nature of health care and the need for commissioners to have a high level of technical and managerial skills…” Ham, 2008

21. What do we know about ‘world class’ commissioning? “The best American commissioning groups have concluded that health care is far more complicated to purchase than anything else … Their salary and bonus packages are designed to attract the best and the brightest. They require excellent data systems analysts and programmers, clinical epidemiologists, clinical managers, organizational experts, financial specialists and legal advisers”. Light, 1998

22. What do we know about ‘world class’ commissioning? “Authors in this volume agree that, despite prevalent rhetoric, strategic purchasing is not in place in many countries and, as a result, the impact has been limited…” “… Overall, the political, technical and financial ability to implement strategic purchasing is the single most important factor in determining its success or otherwise. Most, if not all, strategies reviewed here are very complex and require a high level of technical and managerial skills together with wide ranging information systems that are lacking in many countries”. Figueras, Robinson, and Jakubowski, 2005

23. What do we know about ‘world class’ commissioning? “This report [into primary-care led commissioning] clearly demonstrated the link between adequate levels of management and analytical expertise and the achievement of commissioning objectives” Smith et al, 2004

24. What do we know about ‘world class’ commissioning? “Existing evidence tells us little about the specific mechanisms through which commissioning competency does, or does not, lead to improved health system outcomes. This does not undermine attempts to articulate and develop commissioning competency. However, acknowledgement of this complexity and ambiguity should be seen as the starting point for intelligent discussion of the issue”. Woodin and Wade, 2007

25. Development priorities for PCTs PCTs need to meet massively raised expectations in a very short timeframe, during an economic downturn Rapid development of commissioning capacity and capability is required Particular development needs include: • Clinical engagement/expertise • Communication with the public (to influence and engage) • ‘Up-stream’ public health (demand management) • Commercial acumen and skills (procurement, contracting, market management etc.)

26. Policy priorities If WCC is to be successful, we need: • More commissioning-focussed policy, strategy and regulation • Minimal central intervention in structure of PCTs • More ‘freedoms’ for PCTs • ‘Industrial scale’ interventions to develop commissioning organisations • Significantly improved data quality and availability • Alignment of approach to commissioning in different government departments

27. Research questions and priorities How can we raise the performance of all PCTs, all at the same time? Are there models/examples of rapid organisational development and performance improvement across a whole sector that the NHS could learn from? What tools, techniques, skills and experience can PCTs import from other sectors/countries/industries, and what is unique to health care commissioning?

28. Research questions and priorities Is it possible to demonstrate a link between individual competence, organisational competence, effective commissioning, and improved health outcomes? What are the longer-term implications of a commissioning-led NHS (where provision is dispersed across a range of competing providers)? What are the implications of individual budgets and personal health budgets for commissioners?

29. The ultimate challenge Public service commissioning is essentially an exercise in managing scarcity and complexity. It will always be the case that some groups and individuals in the system will feel that commissioning has ‘failed’ them The response of commissioners should not be to give up, but to remember their responsibilities as advocates and custodians, and to accept that ‘world class’ status may always be elusive

30. Questions/Discussion Elizabeth.wade@nhsconfed.org Elizabeth Wade Senior Policy Manager (Commissioning)

31. References Ham, C. (2008) Health Care Commissioning in the International Context: Lessons from Experience and Evidence. Birmingham: Health Services Management Centre Figueras, J., Robinson, R., & Jakubowski, E. (2005) Purchasing to improve health systems performance. Maidenhead: Open University Press Light, D. W. (1998) Effective Commissioning: lessons from purchasing in American managed care. London:Office of Health Economics Smith, J., Mays, N., Dixon, J., Goodwin, N., Lewis, R., McClelland, S., & Wyke, S. (2004) A review of the effectiveness of primary care-led commissioning and its place in the NHS. London: The Health Foundation Woodin, J. and Wade, E. (2007) Towards World Class Commissioning Competency. Birmingham: Health Services Management Centre