Feature / Celtic connections

Health services in the devolved nations of the UK are often lumped together, which in many ways is wrong as their systems have key differences. But the similarities in where they are now or where they intend to be in a few years, means they can learn from each other, as well as from England. This was clear at a summit of finance directors from these Celtic nations in Belfast last month.

While a range of topics were discussed at the meeting, organised by Northern Ireland Health and Social Care Board finance director Paul Cummings, several themes ran through the discussion. ‘When I talk to colleagues in Scotland and Wales, I am convinced we are trying to tackle the same problems, at the same scale and with the same value base. I know we can learn a lot from each other,’ Mr Cummings said.

Though the models for operating the NHS in the Celtic nations may change – indeed, Northern Ireland is reviewing commissioning – the challenges are common to all of them. ‘The model won’t sort out the challenges – that’s one of the reasons why I wanted to bring us together,’ added Mr Cummings.

While all the nations were talking about service transformation, the integration of health and social care (see box below) and value-based healthcare were the means to tackle the quality, safety and financial challenges facing Scotland, Wales and Northern Ireland.

Value was a major theme. In recent years Scotland has been at the forefront of action on quality and safety. NHS Lothian director of finance Susan Goldsmith described how her health board is building on this by collaborating with Utah-based Intermountain Healthcare to improve quality by driving out unwarranted variation in clinical practice.

Intermountain focused on the process of care in specific conditions and identified these elements or ‘units of care’ that made up a treatment along with the related outcome. They also attributed costs and overtime and were able to demonstrate significant savings by reducing variation in practice. Intermountain starts with the premise that if you have variation in processes and costs, that’s a quality issue.

NHS Lothian is at the very early stages of exploring how Intermountain’s approach might work best in Lothian. It has identified three pathways – stroke, day chemotherapy and psychological therapies – and is currently considering which processes within these pathways it will focus on.

It is a big change for finance, but so far the experience has been positive and has boosted engagement between clinicians.

Scotland has a number of costing models, and nationally is working on a patient-level costing system. NHS Lothian is also working with Netherlands-based company Performation to develop a real-time costing system. The real challenge is moving from costing to finance informatics.

Nottingham University Hospitals NHS Trust deputy director of finance and procurement Duncan Orme outlined his finance department’s drive to provide better information to clinicians to help them improve their care. They had offered traditional budget statements, which, generally, clinicians did not find useful. In response, it introduced service line reporting, including costs, and is now rolling out patient-level costing.

‘Consultants can drill down to all their cases and see profit and loss. And, because we publish the information every month, they remember the patients and it means something to them,’ said Mr Orme.

Aneurin Bevan University Health Board director of finance and deputy chief executive Alan Brace said his organisation realised traditional cost-cutting was not going to deliver the savings needed. Instead, it turned to value-based care. Basing its work on that of healthcare value gurus Michael Porter and Robert Kaplan – and adopting time-driven activity-based costing (TDABC) to provide data – the board started talking to senior clinicians about processes that could be made more efficient while maintaining or improving patient care.

Value has also been picked up by health and social services minister Mark Drakeford, who has dubbed the all-Wales initiative ‘prudent healthcare’. The concept is to manage clinical variation and minimise harm to patients.

Mr Brace said in doing so, healthcare providers must distinguish between technical outcomes (performing the intervention to the highest standard) and outcomes for the patient (care that improves a patient’s quality of life). Both were important in value-based healthcare.

As part of the prudent healthcare initiative, Aneurin Bevan is looking into knee replacement surgery. A survey by the King’s Fund has shown that a year after the surgery a third of patients felt the procedure has made little difference, with no improvement in functionality. In a value-based system, 30% of knee replacement operations would never have been performed – potentially saving the patient going through the procedure for little gain and reducing waiting lists and costs.

‘In some ways at Aneurin Bevan we needed to stop talking about cost and focus instead on outcomes. We should be looking at how a proposed investment brings value and getting value ingrained into our organisations,’ said Mr Brace.

TDABC was important in getting the information needed to support value initiatives. ‘Traditionally, costing in healthcare has been peanut butter costing – you take a lump of cost and spread it around. The trouble is that it tells you nothing about things like used and unused capacity and productive and unproductive time.’

He added that the service had a mindset that many of its costs were fixed, when that was not always the case. ‘If you want to run three district general hospitals, that’s a choice. Costing in the past has fixed people’s minds about what they can and cannot do,’ he said.

The Aneurin Bevan TDABC looked at the cost of staff time, finding, for example, that in knee replacement, patients had 180 contacts with staff from outpatients to completion of the procedure. Clinicians and managers identified some of these contacts as of little benefit, or could be delivered by other staff, allowing them to rethink the pathway.

While value was a major topic, delegates frequently returned to the day-to-day financial pressures facing the health services in the three nations. They were keen to compare notes.

Ms Goldsmith said Scottish directors of finance had produced a forward view of the NHS financial gap in 2015/16 and 2016/17. It called for savings of £210m in the first year and a further £224m in 2016/17. She said that though it was clear that 2015/16 was extremely difficult, at the end of the first quarter boards forecast a break-even position for the year.

Drugs and locum costs are the biggest cost pressures in Scotland, the latter particularly because of the fall-out from Mid Staffordshire, which has also had an impact on Wales. After the Mid Staffordshire scandal and concerns over some care at Abertawe Bro Morgannwg University Health Board hospitals, the Welsh government introduced nursing principles – safer staffing guidelines that are to be statutory. The financial impact has been great. Mr Brace said his health board now spends more than £1m a month on agency nursing.

On top of this, all delegates reported difficulties recruiting doctors to work in some towns and districts, as well as specialties such as emergency medicine. Mr Brace said paediatrics services had to be centralised because of Welsh Deanery requirements, which meant his health board could not staff the service at all its units. This had a knock-on effect on the organisation of obstetric services. Next year, general surgery could be centralised. The other countries were in a similar position.

Welsh health boards have faced flat cash settlements over the past few years and have been expected to deliver 5% to 6% efficiency savings each year – for his Aneurin Bevan University Health Board this adds up to a £60m gap that has to be bridged each year.

In addition, until recent changes in the accounting regime, Welsh health boards had to break even every year. Boards must now break even over a rolling three-year period.

The Welsh government recently commissioned the Nuffield Trust to examine the NHS Wales finances and it found a £2.5bn gap over the next 10 years, if spending is maintained and costs continue to rise. Similarly, the Northern Ireland representatives said studies had shown that local need was up to 15% higher than in England.

Around 12 years’ ago, the Wanless reviews for England and Wales, as well as similar reports in Scotland and Northern Ireland, pinpointed the rise in demand the NHS is now facing. The options were extra funding and/or greater involvement of individuals in looking after their health.

While more funding has been found over the intervening years, the delegates questioned whether national public health agencies had made a marked difference to individuals’ engagement in healthier lifestyles.

Health services now faced little prospect of significant additional funding and populations whose health needs would only rise.

Against this background, the sharing of information and best practice, particularly on innovations such as value-based healthcare and experience of integration, can only help the Celtic nations address their challenges.