PbR: A target by any other name...

Fri, 10 Jul 2009

Apparently the dominant conversation in the NHS somewhere is about quality. Perhaps someone can take me there because at the coal face the dominant conversation is not quality, it is activity, activity, activity - code for income, income, income. PbR as an abbreviation now lends itself to a much clearer redefinition for the providers of healthcare services in NHS England – ‘Patients bring Revenue’.

PbR, whichever way it is defined, has made activity a target. I won’t bore you with the predictable and unpredictable consequences of targets that seemingly don’t matter because rewards and penalties come with targets, not consequences. One often forgotten consequence of the activity target industry is the multitude of jobs generated ranging from those in the rarefied towers in Whitehall, to unnecessarily busy managers in offices and corridors across the land down to the windowless basements filled with growing armies of coders popping vitamin D supplements whilst voraciously coding the local health economies out of every penny, and more.

A conversation with a GP leading an out of hours service revealed a new and intriguing development in ‘joined up working’ between acute and primary care services. The GP received a cold call from an acute Trust manager asking why so few (fewer than usual) children were now being referred to a children’s service burdened by PbR/activity and PFI/mortgage targets. Think about that for a minute. A manager picked up the telephone, called a GP and asked why demand was dropping. Managers are being tasked to seek and stimulate activity, including spending precious resources on marketing, because activity is income. Managers, at the very least, do not have the capacity to think, never mind engage with a conversation or action on quality. They are too busy meeting targets and activity has become a target.

Lest anyone thinks thatprivatization is the answer, orJohn Lewis is a worthy model, you might first want to agree on the primary aim of any private sector enterprise. And before you fall into the trap of thinking that competition is the slayer of waste and master of efficiency, you really must read some Deming and explore the wealth of evidence that might just balance that view. Actually, I suggest you start by readingAtul Gawande’s most recent piece on why the US healthcare system has failed – PbR – Patient based Revenue. The core driver for rising costs in the US is the primary principle of any private sector organisation, profit, and the source of that profit is the patient. It is Patient based Revenue that has inflated and destroyed healthcare in the US, and that in a land that epitomises all that is the reality of private healthcare. Lunch with some colleagues recently in the US revealed a very telling reality – “if we can bill it, we will seek it” – the unwritten vision of private healthcare.

Thanks to Patient based Revenue, that NHS manager with that phone call has taken us yet further away from quality and closer to a ‘seek to bill’ culture. NHS England, now also better known as PbRS England (Patient based Revenue Service), may one day relearn its lessons from the surrounding countries that perhaps now more legitimately use the NHS logo.

Readers' comments (4)

Anonymous | 13-Jul-2009 9:44 am
Receiving payment for no activity is worse.
Paying doctors for low productivity in the NHS is not a solution.
Patients are not exactly looking to ditch the US model despite its costs.
Personally I always find it suspicious when doctors purport to be interested in the public purse when they usually display a keen interest in maximising their take.
What the blogger is looking to do is to exploit the opposition to targets to include PBR-presumably so that the NHS can go back to the golden era of cash limits and waiting lists!. PBR has nothing to do with targets it merely rewards according to what Hospitals do. If they do less they get less.
If Doctors are unprofessionmally doing more than is justified for the patients medical condition then they should be regulated ,monitored and sanctioned to prevent this. It is not PBR that is the problem but light touch regulation and professional self regulation.
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Anonymous | 13-Jul-2009 2:11 pm
PBR does not incentivise activity. It incentivises efficiency. Only when profit is a motive does it incentive both efficiency and activity. Inefficient and highly active systems just loose money faster. PBR doesn't incentivie efficency as a market would, it actually incentivises all organisations to work at the same level of efficency, rather than engage in an arms race for more efficiency. It's up to the DH to pull the incentive lever if they own the PBR traiff. Ultimately the DH have to hand this over to the commissioners. It's difficult to see how the PCTs can save 15% over three years if they don't hold this lever.
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Nadeem Moghal | 13-Jul-2009 3:29 pm
PbR is a rather large elephant and as the fable goes, some see parts of it, but few see it as a whole...PbR has revealed those activities that are profitable, and so as is the nature of the human condition, it is those activities that are being actively sought, but not by medics - who have no immediate financial gain from PbR - but by the organisations that know the value of profitable vs. loss making activities. In PbRS England there is evidence to show that specialities are receiving investments because the activities generated are profitable and for which demand can be directed and manipulated. The damage done to other providers and specialities is real and the impact can be found in more than one report.

Read the blog again - It wasn't a medic that called the GP to ask why demand had dropped. Management behaviour as a consequence of the PbR policy - who is regulating that? The US 'seek it, bill it' culture is regulated, despite which the costs have inflated – if the size of your salary depended on how much work you did – might that influence how much you did?

PbR is generating activity based targets. Today it is for the apparently non-profit making hospital. Tomorrow it may be for a John Lewis Partner working with a PbRS England partner, where profit is the driver.

Step back and look at the Elephant.
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Anonymous | 17-Jul-2009 1:55 pm
As a GP in a PBC consortium, I agree with the blogger.
One of the effects noticed locally (which is why I am posting anonymously - I suspect this is a general problem) was a re-classification of services e.g. previous "seen on ward" cases became one day admissions, and nurse-led clinics were re-classified as consultant clinics (after all, there was a consultant in the hospital somewhere) with a massive increase in tariff.
The rate of admissions from A&E has increased - the target for 4 hour waits appears to be solved by admitting patients about to breach: there may be other reasons but the effect on the local health economy is dire.

There do need to be systems for funding hospitals, and these do need to be related in some way to activity (just look at the effects of the imposition of Independent Treatment Centres - guaranteed income, amount of activity irrelevant) - but PbR doesn't appear - from a primary care view point - to do anything to improve efficiency, encourage transfer of care from secondary to primary settings or to stop the constant haemorrhage of funds from the PCT budgets into secondary care - to the extreme detriment of the local health economy.

But where, in the DH, is there anyone who can see that supporting hospitals (did you hear that it is not the NHS but hospitals who are to be protected during the economic squeeze?) means that other areas will receive *less* support?
Basic economics and joined-up planning skills have always been absent in DH - and probably the whole of HMG!
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