NATIONAL DELIVERY PLAN Proposed streamlining scheme gets cautious welcome

Published: 17/03/2005, Volume II5, No. 5947 Page 5

The Department of Health wants primary care trusts to join together in groups to make contracting with providers more efficient, NHS chief executive Sir Nigel Crisp has told HSJ.

A move by 10 PCTs in north-east Yorkshire and north Lincolnshire to tender for a contract management service (see box) has inspired the DoH to explore whether the idea could be introduced regionally or even nationally.

The introduction of foundation trusts means PCTs have to sign legally binding contracts with providers.

Under the proposed system, examined in the DoH's national delivery plan, a group of PCTs would have a single contract with an acute provider. The contract management service would agree the contract, as well as monitoring and analysing its use.

'We are attracted to this because it looks as if it reduces transaction costs considerably, ' said Sir Nigel.

'The management service would [also] mean PCTs wouldn't spend so much time checking the patient went [for treatment] and checking the information [about that treatment] was right. You could also analyse the use of, for example, Guys and St Thomas' across 50 PCTs, not just one.' Sir Nigel even sees the possibility of as few as four, and maybe even just one, NHS contract per trust. Even 10 PCTs working together were unlikely to be able to sign contracts with all the providers they might use. Acute trusts which took most of their work under joint contracts would also still receive patients from other PCTs, requiring a contract to be drawn up.

To counter this, Sir Nigel said, the PCTs might decide to have 'four or five' contract management systems covering the whole country.

Alternatively, he suggested: 'Why do not we have one NHS contract with each trust? If you're a PCT anywhere and you want to send a patient there, you can use the terms and conditions of that contract to do so.' Sir Nigel stressed that the new contracting arrangements would not be imposed, nor would the NHS leap to the proposed system 'in one go'. He identified the 'shared services' programme that covers a range of 'back office' functions and is being developed by trusts as they join and begin to play a part in its governance as a model worth following.

However, ministerial approval would be needed and Sir Nigel said a group of NHS executives working under the remit of the new leadership network for health and social care would bring proposals to ministers by the end of 2005.

By adding contracting to the 'back office' functions, Sir Nigel said he expected to PCTs to focus more on 'how services fit together', on managing choice and on public health.

However, he also acknowledged that this development, together with the arrival of practice-based commissioning, is likely to have an impact on PCT numbers. 'Over time we will see a smaller number of PCTs, but I am not looking for a target.'

Sir Nigel said the goal of PCTs to learn more about their population would be aided by the DoH's new 'customer insight unit'.

This will provide data for PCTs using techniques developed by supermarkets. Sir Nigel said the project undertaken by Slough PCT and health information business Dr Foster to identify patients with undiagnosed diabetes was a good example of the kind of work the unit would enable (page 8, 28 October 2004).

National Primary Care Network leader Edna Robinson said: 'I have a lot of sympathy with this [joint contracting]. There hasn't been enough capacity in PCTs so far in terms of commissioning generally, so anything that helps to standardise back office functions so PCTs can concentrate on service redesign has to be welcomed.' However, she added: 'We do not want to end up with local PCTs being disenfranchised from having the money to ring the major changes they still need to lead on. This is to be welcomed so long as there is not a shift in the balance of power away from PCTs.' Bradford South and West PCT chief executive Dr Barbara Hakin said: 'It is a good idea, but it will need to be tested on high-volume elective care, where it is easy to define standards across the country. With emergency admissions, for example, there is more local variation so it would be harder to co-ordinate over a large geographical area.'