Patient data may give NHS an unfair edge
Powerful patient-level costing systems may give NHS hospital providers an unfair advantage in contract negotiations unless they are required to share their data with commissioners.
The Nuffield Trust today published the results of a research project to establish whether hospitals can make efficiency savings through the introduction of patient-level information and costing systems (PLICS). These IT systems allow providers to track income and expenditure at the level of individual patients, instead of tracking aggregated clinical specialties or service lines.
Nuffield Trust researchers found that the evidence that introducing these systems would produce short-term savings was “modest”. Their report said that, despite the Department of Health’s hopes for PLICS improving “clinical ownership” of hospital finances, specific examples of them prompting “changed clinical behaviour towards providing more efficient care” were “surprisingly rare”.
However, they reported that PLICS was a powerful source of data that providers could use to inform contract negotiations or the development of national NHS tariff prices. One trust told the researchers that “one of the main purposes of its PLICS system” was “the ability to lobby on and inform future tariff development”.
The report concluded that the “advent of PLICS means providers have a very advanced understanding of their costs, something to which the commissioners are not guaranteed access”.
It warned: “This creates an information asymmetry, which can have a detrimental effect on the efficiency of a market.”
To guard against this, it suggested policy-makers could “mandate some level of cost information sharing between all providers and commissioners”.
The report also warned that as NHS providers learn more about which of their services generate a surplus, some may “try to reduce their activity in areas that are not profitable”.
Ian Blunt, one of the authors, told HSJ that at the moment many trusts facing deficit simply seek to increase their activity.
However, as the use of these systems gave them more accurate information trusts were going to start “thinking seriously about their position against tariff” for individual services.
He added: “That does have the potential for organisations to start focusing on that surplus-generating work, and trying to reduce the amount of deficit generating work they’re doing.”
In this situation, the NHS Commissioning Board would have an important “monitoring” job to ensure continued equity of access to care, the report said.
The researchers also analysed a full year of anonymised patient-level data - from 2008-09 - for one trust that introduced PLICS in 2007. They found that only 17 per cent of the trust’s cases had costs that fell within 10 per cent of their appropriate tariff payment.