Feature / Getting back on track

Sustainability and transformation partnerships (STPs) were established in 2015 with noble motives: to improve taxpayer value over a five-year planning horizon by bringing together commissioners, providers, social services and the third sector within a defined region. But have they lost their way?

Together STPs were meant to articulate a local vision of a better integrated health and social care future – a vision built on the three inter-related pillars of finance, quality and health and well-being. In economic terms, STPs represented a value proposition.

This non-negotiable process, set out for the 44 local STPs by NHS England, required them to extrapolate a dystopian future where demographic and epidemiological trends continued unabated and were overlaid with negative real-terms growth. This would both make the case for essential change and encourage a fresh joined-up approach to planning and delivering a better future state.

Two years on from their launch, what progress has been made? The STPs have certainly underlined the worst case scenarios that would emerge by 2020 if no action were taken. Reports suggest that STPs collectively are targeting £26bn in ‘savings’ to remain within funding constraints. The concern is that the plans have led to an almost exclusive focus on reducing NHS spending or future NHS cost avoidance, sidelining the original triple aims (and arguably local authorities and the third sector).

This narrowing of the STP task runs counter to work by Michael Porter on delivering value-based healthcare. Professor Porter would admire much in the original triple aims of the STP approach, but is unlikely to have been impressed with the progress to date in delivering ‘do something’ solutions. For Professor Porter, value is the interaction of health and social care outcomes delivered and resources deployed. 

Importantly, outcomes should not only be defined by health status measures (such as survival ratios and outputs). They should also include individual patient experiences (measured, for example, by satisfaction surveys, patient reported outcome measures and pain scores) and longer term impacts on population health (such as mobility, mental well-being and return to work numbers).  

In many cases, STPs have largely shrunk their scope to major on resources to the near exclusion of outcomes. Where outcomes are logged, these are often limited to a restricted range of RightCare or Getting it right first time commissioner or provider metrics.

Destined to fail? 

In their game-changing paper – The strategy that will fix healthcare – Professor Porter and co-author Thomas Lee start from the standpoint that in seeking to frame reduced funding with rising costs and uneven quality as an ‘efficiency problem’, the NHS and countless other systems worldwide are starting from the wrong perspective. As such, they are inevitably developing strategies that are destined to fail.  

So what does the Porter playbook recommend that could help get STPs back on track to secure their noble ‘triple objective’ version of taxpayer value?

The first imperative is to measure the important stuff, because only through measurement will progress be made. In this instance, this means measuring what is important to patients and taxpayers – namely, outcomes and costs. 

More specifically, we must cost and budget on outcomes and costs by medical condition and by patients. Currently, we collect information largely at input or output level only and that is institution-specific rather than patient-centred. 

Professor Porter has recommended the routine collection of three tiers of patient specific data-sets: 

• Tier one data is concerned with resulting health status such as five-year survival rates. 
• Tier two data measures compliance with the pathway or cycle of care, including measures on readmissions and waiting times. 
• Tier three data relates to longer term sustainability of the treatment cycle and might include long-term increases in mobility or freedom from pain. 

Capturing this data – and doing so at individual patient level – implies a quantum leap in the NHS data capture and processing capability and a new data sharing compact between the NHS and the patient.

On the cost side of the value equation, Professor Porter is clear that universally available patient-level information and costing systems (PLICS) are long overdue and must cover the full cycle of care for a single patient with a specific clinical condition. 

Professor Porter and colleague Robert Kaplan have promoted a time-driven activity-based costing (TDABC) approach to healthcare system planning and control. Such an approach builds a cost profile by patient from the base upwards and has the advantage of relating most closely to clinical practice. 

Genuine shifts in value can only be achieved through changes in clinical practice. The English STP model goes some way towards laying the foundations for common informatics approaches and a genuine recasting of clinical practice across organisational boundaries.  And there are promising moves towards a comprehensive system of patient-level costing, using common and mandated standards. But in general, STPs remain some distance from the overall vision.

Healthcare provision 

Professor Porter is similarly directive about how healthcare provision should be structured across health economies. First, he advocates the reorganisation of services into ‘integrated practice units’ (IPUs). These are similar, perhaps, to existing NHS care networks, but are a significant distance from existing siloed NHS providers. 

An STP-level IPU could be organised around a set of closely related patient conditions such as diabetes or renal care. It would draw together all the relevant clinical staff, employed in different local organisations, to provide direct patient care as well as patient education and carer support. Putting a relentless focus on the different costs and contributions of individuals within an IPU supply chain is how improved value will be delivered.

Ideally within an STP, clinicians and support staff operating within a single IPU would be co-located. Notwithstanding this, however, IPUs would require a significant volume of rich common patient and population data, shared across the STP. This would demand sophisticated IT infrastructure and advanced secure communications to operate effectively. 

The technical and logistic challenges cannot be underestimated. However, economists are persuaded that the resulting identification of duplication and waste is massive. Professor Porter and Dr Lee, for example, point to the significant savings made at Virginia Mason Medical Center in Seattle (average hospital visits for spinal care reduced from eight to four, for instance). 

Professor Porter is also an advocate of economies of scale in healthcare delivery. His argument for a fundamental four-stage reorganisation of provision could guide STP development:

• Define the scope of services (some existing services may be uneconomic or best provided super-regionally for example).
• Concentrate volume in a few locations to exploit scale for cost and quality reasons
• Match such locations with services within IPUs
• Build IPUs across locations.

Again, the delivery challenge for STPs here is immense. This approach would entail removing some staunchly defended trust facilities and challenge accepted medical architecture. But it might also be at odds with the government’s ‘care closer to home’ mantra. 

For economists, pushing for economies of scale in times of financial austerity feels instinctively right. And in England, the widely supported consolidation of hyper-acute stroke care provides a blueprint for other services.

Again, for Professor Porter, the most successful providers would lead the development of IPUs and a hub and spoke provider model will emerge. This is likely to lead to the highest value providers swallowing up more remote hubs to form new regional networks.  This chimes well with the NHS’s commitment to clinical networks with their well-established national hierarchies, and with provider chain experiments. 

In terms of contracting models, the NHS in England is clearly moving away from payment by results activity-based payment approaches towards capitation or period of care funding models. For Professor Porter, such polar extremes are equally flawed. He advocates instead bundled payment covering a full care cycle for a patient condition. This, he says, encourages cross-silo working to deliver budgets and promote value, with IPU providers incentivised to reduce duplication and cost. Applying this to an STP model would still allow local commissioners and providers to debate the standard reimbursement tariff for a particular cycle of care. But it would be on a basis that is more meaningful in terms of individual patients’ experience and informed by meaningful data.

Michael Porter’s work sets out some fundamental truths. First, organising services around the patient is not only intuitively right but is shown to offer greatest value. Second, in a period of financial retrenchment, aiming for increased economies of scale is a tried and tested response and so is perhaps not a bad mantra for STPs. Third, there is no denying the need for a quantum improvement in information flows between the key pathway players in a locality. 

And finally, a broader focus on value and not cost has to yield a more sustainable and enduring solution in even the most challenged STP. 

• Paul Assinder (pictured) is a management consultant working in the NHS. An experienced NHS finance director and former HFMA national president, he also lectures on health economics and delivers the health economics module within the HFMA qualifications set.