Sue Thomas and Paul Midgley, of Wilmington Healthcare, assess the implications of a single budget covering all the physical, mental and social care needs of patients in an STP
Multi-year, capitated budget based, accountable care
contracts – which involve one provider or a group
of providers covering all the healthcare needs of a defined population – are increasingly
being viewed by NHS England as the best way to manage the complex healthcare
needs of the nation’s ageing population and the associated burden of chronic
The Lakeside Vanguard in Corby was an early adopter of this
Accountable Care philosophy and around 50 percent of Sustainability and
Transformation Partnerships (STPs) are currently considering introducing capitated
budgets, with nine areas leading the way and identified in the ‘Next Steps on
the Five Year Forward View’.
Within a capitated budget model, the physical, mental and
social care needs of a defined population are handled by a single entity, or a group
of providers, who are tasked with improving outcomes and reducing costs, across
a defined area – an Accountable Care System (ACS). The ACSs will deal with
specific diseases initially but will eventually cover all the health and social
care needs of a designated population.
Care must be provided in line with agreed quality and
outcomes standards which are written into a contract, and service providers are
financially incentivised to maintain them. This means that commissioners can scrutinise
the delivery of contracts for particular therapy areas and will only hand over
the final part of their budget to the lead provider when performance measures
show that it has fulfilled its responsibilities.
If the lead provider delivers the desired services more
cost effectively than anticipated, any surplus may be invested in further improving
Evidence from other countries, such as Spain, Germany and
the US, shows that providers in capitated budget networks keep costs down by investing
more in prevention, and thereby helping people stay healthy and out of hospital,
Capitated Budget Accountable Care model, a cash limit is set for every common
chronic disease (a ‘programme budget’) and since the NHS is not expected to
receive more than an inflationary increase in its annual budgets, money will
have to be saved and then recycled within the system in order to improve care. Savings
will have to be made through proactive changes, such as disease prevention,
earlier diagnosis, and more effective and integrated intervention, within each
realise these changes, patient pathways will have to become far more efficient in
order to reduce pressure on the budget. This will require a more integrated
approach to disease prevention, early diagnosis and effective management of
conditions in order to keep patients stable for as long as possible and avert unnecessary
by Results’ (PbR) will be dropped. With reduced transactional (activity) costs,
there will be no incentives for people to stay in hospitals, and clinicians
will be encouraged to provide as much care in the community and at home as
possible. Specialists’ roles will need to change to support this.
will be a key enabler of this change, hence artificial barriers that currently
prevent it from being fully utilised will have to be removed and a lot of
specialist knowledge will have to be filtered down through the NHS to enable
care to be provided effectively outside of hospitals. These changes will see
more high tech and high cost drugs being administered in the home supported by
specialist nurses and consultants.
services in this way can save money in terms of VAT on hospital care and reduce
pressure on hospitals which often have limited infusion capacity. Also, it’s
often safer for patients to receive treatment at home to avoid iatrogenic
diseases, for example, infections in immune-suppressed patients.
already a clear move towards providing more specialist services in the
community and in patients’ homes. For example, in renal care, people routinely
attended hospital for dialysis, but now this procedure can be done at home.
As health and social care providers are united within STPs,
it is likely that multi-year capitated budgets will be tendered within many
footprints through an Accountable Care model. Pharma needs to identify the
early adopters of accountable care and take a thoughtful approach to
dovetailing its products and services with the major changes that these
organisations will bring to bear on NHS spending.
Sue Thomas is CEO of the
Commissioning Excellence Directorate and Paul Midgley is director of NHS
insight, both at Wilmington Healthcare. For information on Wilmington
Healthcare, log on to www.wilmingtonhealthcare.com