Pathology networks: the new path

31 October 2018 Seamus Ward

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Test tubesThe government’s recent announcements that the NHS long-term plan will include a renewed focus on detecting cancer earlier was widely welcomed. But the extra activity brought about by, for example, lowering the screening age for bowel cancer to 50, will be supported by a range of specialists and also increases in a swathe of diagnostic tests. Trusts and NHS Improvement will be mindful of such step changes as they implement reforms of pathology services that aim to make them more efficient and maintain or improve services to patients. The reforms go back to the first report by Lord Carter a decade ago – which was confined to pathology – and his more recent report on the performance and productivity of acute trusts. In 2008, he concluded that trusts should consolidate pathology services. Trusts that responded by forming partnerships with neighbouring trusts were the most efficient in the NHS, according to analysis for the more recent report.

Last year, NHS Improvement wrote to trusts, setting out plans to bring together 122 individual pathology units in English hospitals into 29 pathology networks by 2021. It claimed this would save at least £200m a year on total running costs of £2.2bn. The networks would be formed on a hub-and-spoke basis, with hubs performing ‘cold’ pathology, where results are not needed within one to two hours, as well as some specialist tests and urgent ‘hot’ pathology for its host trust.

Single networks for the whole of England are being developed for specialist tests for highly complex services, such as paediatric pathology, and those services at risk, including electron microscopy.

The spokes – or essential service laboratories (ESLs) – should provide tests essential for the acute management of patients – including those in A&E, intensive care and theatres – as well as tests that are operationally urgent, for example diagnostic tests to support discharge.

‘We have modelled the ESLs to be as efficient as possible while retaining the high level of service we see across the NHS,’ says David Wells, head of pathology services consolidation at NHS Improvement.

‘We have also been modelling highly specialist work in supra or national networks, so the NHS is not introducing new capacity in a system where there is existing capacity across specialist trusts.’

Mr Wells insists NHS Improvement has a few non-negotiable rules. The first rule is that pathology providers must work together in a defined local network. Also, variations from the hub and spoke model must be backed by a sound business case and must not adversely affect the patient pathway.

In September, NHS Improvement published a 12-month progress report, NHS Improvement pathology networking in England: the state of the nation, which highlighted high levels of engagement in the formation of networks. It said trusts reported £33.6m of pathology cost improvements, with a further £30m identified in trust plans for 2018/19. 

Savings underestimate

Mr Wells says the savings generated so far are those declared by trusts in their cost improvement programmes (CIPs) – delivered through the first steps trusts have taken to consolidate work, perform it at scale and bundle their procurement of pathology supplies. But he believes the real savings figure is much higher. ‘The reduction in operating costs of £33m is an underestimate of what’s being driven out of the costs of pathology services in England.
Test tubes

This is from working towards networking – they’ve not made big changes yet,’ he says.

‘Trusts have been modest about their savings. Our data collections are becoming more consistent and we are confident that £33m is an underestimate – that’s why we believe our figure of £200m in savings by 2020/21 is possibly a conservative estimate.’

Reaction to the network model has been mixed. The Royal College of Pathology has been worried about jobs and the loss of key skills, which could disrupt these vital services.

Alan Sumner, head of public affairs at Roche Diagnostics UK, which has partnerships with some trusts, says: ‘We welcome any plans that will enable patients to receive quicker, more advanced and reliable screening test results that will deliver better value and high-quality care.

Test tubes‘The core of a sustainable pathology system lies in appreciating the true value of in vitro diagnostics. Innovative in-vitro diagnostic tests are an essential part of the NHS. Their use reduces healthcare problems, hospitalisation rates and health costs, as well as facilitating more informed clinical decision-making. They bring sustainable financial benefit to healthcare, improving the quality and saving patients’ lives.’

Following the Carter reports, pathology provision is a complex picture – much of it is provided in-house by trusts, but some trusts have partnership agreements with neighbouring NHS providers; some trusts or groups of trusts have set up wholly owned subsidiaries; and in other areas pathology is wholly or partly provided by private sector labs.

The state of the nation report sets out how each of the 29 networks could be arranged, with a hub and ESL spokes, but also recognising that other models have been established. For example, the North East network includes two hubs, five ESLs and two public outsourced providers (see box). Lancashire and South Cumbria Pathology Partnership has one hub and three ESLs. A network labelled Midlands and East 8, providing services in Essex, has an ESL and two private outsourced providers.

David WellsMr Wells says NHS Improvement is agnostic about the exact model adopted by each network. A network could have more than one hub or an ESL could retain some cold pathology tests, for example, if the network can prove it is efficient and the right choice for the local patients and system.

‘It could be a wide geographical area where some general practices are some distance from the hub,’ he says. ‘If the changes are presenting a challenge to your local system, come up with your alternatives and come and talk to us if you want to do something different.’

However, he points out that there is an issue of scale – hubs should provide the greatest value because they will perform tests at volume.

Local disagreements alone cannot be the basis of decisions over hub and spoke arrangements, he adds. If, for example, two trusts can’t agree and insist both should have pathology hubs, this would not be supported by NHS Improvement without strong evidence to back the arrangement. However, if they can demonstrate that two hubs would deliver the same benefits to patients expected from a single hub, at the same cost, this could be the right model for that network.

NHS Improvement does not want trusts to get caught up in decisions over the organisational form their network will take. ‘It doesn’t take much – a memorandum of understanding – to begin to drive out large savings without getting involved in the complexities of what the ownership model should be,’ Mr Wells says. ‘Form should follow function – trusts should act immediately. Though we are insisting trusts will network, we are relaxed about organisational form.’

All options are on the table, from alliance contracting to outsourcing. ‘Some footprints are going to struggle to find the investment they need to provide the quality and scale of services and outsourcing could be the answer,’ says Mr Wells.

‘We are looking for high-quality lab services that are fully staffed and continue to provide our high standards. We have workforce shortages in some areas and they might need to take a partner.’
Developing market

He acknowledges that trusts can see outsourcing as a loss of control, adding that a market for pathology services could develop as providers – public and private – seek to expand. As a result, the number of networks could shrink.

A market could also develop for GP direct access pathology. ‘We have high-quality lab services, with most ISO1589 accredited. The quality of the service is largely a given and, though we wouldn’t want to rest on our laurels, the choice comes down to cost.

‘Normally, clinical commissioning groups commission blood tests for primary care from their closest provider. But where we are seeing networks form, commissioners are being a lot smarter and are going to alternative providers. Again, our rule is that it should not affect the patient pathway – don’t let there be circumstances where a patient has two blood tests where previously it would have been one.’

The Royal College of Pathology has called for investment to ensure samples can be transferred in a safe and timely fashion. Crucially, the lab IT systems must be compatible and this could require additional investment.

Interoperability – making sure laboratory information management systems (LIMS) can communicate with each other across individual networks and throughout the NHS in England – is vital in ensuring the networks are efficient and work in patients’ interests. Mr Wells says: ‘With networking there should be compatible IT systems, so it doesn’t matter where you request or process the sample – as long as the GP and secondary care clinician can see the results.’

NHS Improvement is working with NHS Digital and NHS England to define the level of interoperability needed and sources of funding.

He adds that pathology networks should act as a stepping stone, supporting the evolving NHS as set out in the long-term plan. NHS Improvement wants change at pace that also allows for the transformation of care in other parts of the service.

‘I don’t think we are being particularly ambitious with regards to what’s possible, and we want to see that ambition lifted,’ Mr Wells says. ‘Building on the networks will be a key theme of the long-term plan – to ensure we can deliver earlier diagnosis, provide high-quality diagnostic and support tools to primary care and speed up interventions on the right pathway for patients.’

NHS Improvement wants trusts to speed up their move to networks – not only to reap the benefits in terms of services and efficiencies, but also to be ready to implement the long-term plan.

Black Country collaboration

The new Black Country Pathology Service (BCPS) – a network that is currently made up of four trusts – went live on 1 October and aims to save £52m over 10 years.

The network is hosted by The Royal Wolverhampton NHS Trust, which is also the pathology hub, under a partnership agreement underpinned by service level agreements between the partners. On 1 October, around 500 staff, including consultants and pathology staff, moved under TUPE rules to The Royal Wolverhampton.

The four trusts in BCPS – Sandwell and West Birmingham Hospitals NHS Trust, The Dudley Group NHS Foundation Trust, The Royal Wolverhampton NHS Trust and Walsall Healthcare NHS Trust – had been working on the collaboration for 18 months before being placed in a network by NHS Improvement.

Each trust has two representatives on the strategic board running BCPS, which is independently chaired.

The trusts hope Shrewsbury and Telford Hospital NHS Trust will join the network – in the NHS Improvement model, the trust would provide a spoke or ESL service, though details have yet to be decided.

‘We have opened constructive discussions with Shrewsbury and Telford Hospitals to get it to join us,’ says Kevin Stringer, chief financial officer of The Royal Wolverhampton trust.
Kevin Stringer‘We were not being exclusive or difficult when we decided to go ahead without it in October – it’s just the four other trusts had got so far along with the partnership model we decided to complete the transaction and then see how Shrewsbury and Telford wanted to join the network. We kept them up to speed with our progress.

‘I think all four trusts have worked hard together to finally have a collaborative partnership. Everyone involved should be congratulated in making it happen as it means high-quality services for patients and staff at lower cost through economies of scale and technology.’

The NHS Improvement state of the nation report said trusts across the country made savings in 2017/18 through collaboration and cost improvement programmes implemented in advance of establishing networks.

This is true in the Black Country. Mr Stringer says each of the four trusts has made savings in staffing or through renegotiating managed equipment services (MES) contracts. MES is often used for specialist laboratory equipment and he adds that the network will have to issue a new tender for MES to ensure all the labs have the same equipment where appropriate.

The new network is backed by the Black Country Sustainability and Transformation Partnership, which has been awarded £9m in capital funding for IT development and the building of extra physical capacity.

The host trust has signed a commercial contract for the development and implementation of a new laboratory information management system (LIMS) that will have common pathology ordering and results reporting across the Black Country for all hospitals and GPs.

‘It’s critical to have a system in pathology that ensures ordering of tests and reporting of results are done in the same way across the Black Country in one system,’ Mr Stringer says.

An extension is being built to the pathology lab at the Wolverhampton trust’s New Cross site – the network’s hub – to accommodate the additional staff and activity.

However, the delay in completion of the new Midland Metropolitan Hospital (Sandwell and West Birmingham Hospitals or SWB NHS Trust) following the collapse of Carillion will affect the level of savings achieved in the short term. This is due to the requirement for an extra ESL at SWB’s City site due to the delay in the completion date of the new hospital.

Network north

In the North East of England, the NHS has already taken steps to modernise its pathology services.

In 2014, three trusts – Gateshead Health, City Hospitals Sunderland and South Tyneside NHS foundation trusts – brought together their pathology services into a single site in Gateshead. This facility could become part of a wider network that will serve nine trusts.

The Gateshead site is largely automated. It carries out 80% of the ‘cold’ pathology tests – where results are not needed immediately – for the three trusts. Each of the trusts have ‘hot’ pathology labs, which perform urgent tests. The hub allows for thousands of tests to be carried out each day, more efficiently and accurately, the service says. It can also offer state-of-the-art technology and new tests.

However, things could be about to change. Ruth James, pathology programme director for the North East and North Cumbria, says the collaboration will be included in the new North Cumbria and North East Pathology Network, but the final form of the network has yet to be decided.

‘Within the region, work is in progress to develop a local model for pathology services across the North East and North Cumbria,’ she says. ‘The financial impact of any new service model will be calculated once any changes to the current service configuration are agreed.

‘There is a need to invest in IT to support interoperability between the labs. The impact of any new service model on transport will be calculated when the configuration of services is agreed.’