After nearly a decade, it’s time to say goodbye to payment by results.
In her youth, payment by results – or PbR, as we came to know her – seemed so sophisticatedly international, so neat and elegant. Emerging from her drab “new financial flows” disguise, PbR soon became central to the Milburn reforms, right up there with choice and contestability.
Deep down we knew her name was a lie. Critics whispered that PbR was really just payment for activity – piecework, some cruel old-timers called it – and had precious little to do with outcomes. That notion of belatedly joining a European inner circle slipped a little when Scotland and Wales wouldn’t come too. Yet it still hurts to see her dumped with barely a mention.
For what was once PbR is now Tariff. The 2011-12 NHS operating framework uses the T-word for anything new and bright – “best practice tariff” and “30 per cent marginal tariff” – and relegates PbR to technical support without even spelling out the meaning of the acronym.
And for Tariff, the NHS is full of opportunity. Funding methods that reward quality rather than quantity? That are suited to recession rather than growth? That attract commercial providers? That encourage innovation, instead of grinding a few quid off the cost of doing things the old way?
Yet no one really knows this newcomer. Could Tariff follow the bold pathway of university funding? Let providers set the price (£9,000); find that customers choose providers on the basis of their high price (who’d want a university that doesn’t charge £9,000?); and then ration government funding to customers.
Actually we don’t know what government expects of Tariff. We don’t even know whether the DH or Monitor will be her minder.
With the liberated NHS struggling to emerge, this largely untrammelled lack of direction may prove a blessing.
And what of poor PbR? All, it seems, is not lost. PbR has a new job in the prison service, rewarding the successful rehabilitation of short sentence prisoners. Payment for not reoffending. Perhaps, after the frustrations of the NHS, PbR has found a meaningful second career.