Community services trusts are starting work on a national programme to develop indicators to benchmark their performance and value, which could potentially underpin a tariff payment system for the sector, HSJ can reveal.

Those supporting the work hope it will level the playing field between community services providers and the acute sector, which has its own indicators and payment by results currency, by enabling commissioners to see the quantifiable value derived from its activity.

They also hope to hope it will strengthen their ability to fight off contract bids by private companies seeking entry to the market by showing the value of their past work. Independent sector providers have made inroads into the sector in recent times, with Virgin Care winning a £500m community services contract in Surrey and Serco winning a bid to manage Suffolk Community Healthcare last year.

Competition in the £9.7bn sector is likely to intensify as more contracts under the 2010-11 Transforming Community Services programme, most of which were initially intended to run for three years, end.

In 2012-13 the sector accounted for 10.6 per cent of NHS spend, up from 10.2 per cent the previous year. It is likely to grow in significance amid efforts to move services out of hospitals.

Members of the aspirant community foundation trust network have appointed Christina Walters as national programme director to develop the suite of indicators. Dr Walters previously worked for South West Yorkshire Partnership Foundation Trust and for more than six years was part of a project to create indicators and currencies for the mental health sector ahead of the national rollout of a payment by results system.

HSJ understands work to develop the indicators could take up to two years, with the development of currencies and links to a tariff payment system taking considerably longer.

They will be applicable in areas including diabetes services, walk-in centres, school nursing, wheelchair services, district nursing, health visiting, audiology and family nurse partnerships.

The indicators will be based around three domains: performance; quality; and social value equity and inclusion. These would then be broken down further to reflect clinical outcomes, patient experience, patient safety, waiting times and friends and family test scores.

HSJ was told the indicators would not simply replicate those in the acute sector but would attempt to show evidence of the “social value” of community services and the outcomes.

Dr Walters said: “Basic performance indicators don’t go far enough at the moment but once we have indicators showing the outcomes that we want we can start to benchmark organisations.

“From these indicators you can then develop a currency and one day we would hope it’s then possible to have a transparent payment system using these currencies.”

She added: “It is about putting community services on a level playing field. There have been similar efforts in mental health and now people are starting to take [mental health trusts] seriously because they can see what it is they do.”

There is concern the mental health and community services sectors have suffered as “Cinderella services” due to historical underinvestment compared with the acute sector.

Health minister Norman Lamb has described payment by results in the acute sector as having a distorting effect on the rest of the health service in terms of where money and activity flows.

Kate Fallon, chief executive of Bridgewater Community Healthcare Trust, described the project as “vitally important” for community trusts, saying: “We have to be grown up and mature as organisations and be able to demonstrate that we are responsible and offer value for money, as any other trust would or should be.”

She said a level playing field between the community sector providers and the rest of the health service was “what we are aiming for”.

Currently commissioners use locally agreed block contracts with community trusts, which Ms Fallon said were not capable of benchmarking “as you can’t compare costs between organisations or see who is the better provider.”