News / Stockport on track for outcome-based payment (HFMA 2016)

The local area is looking to use the new payment approach to underpin a contract with the area’s multi-specialty community provider – Stockport Together – which is redesigning services to be more integrated across the whole health economy.

The contract – which is likely to be introduced initially in shadow form – will have a capitation element based on the population of over 65s and an element related to the achievement of agreed outcomes. Care of under 65s will stay on the current payment mechanisms.

Mark Costello, associate director of BDO Consulting, which has been supporting the change programme, told a workshop at the HFMA annual conference in London, that moving to outcome payment was inherently risky. However it has developed a tool to inform discussions among the clinical commissioning group and local providers to help quantify the financial risks facing the different organisations.

‘It doesn’t provide absolute answers about the value of contracts in five years time,’ he said. ‘But it starts to engage all the stakeholders and to stimulate discussion about what impact the new contract mechanism might have.’

The tool uses simple data sources, including five-year locality financial plans, 2016/17 contract values and population projections and defines risk as an increase in deficit and elements of income linked to outcomes.

He said the tool had helped people to think through the difference between theoretical risk – the total income for a provider linked to outcomes – and effective risk. There was an expectation that required outcomes would be stretching but achievable. However the tool was a way of examining the impact of changes in population alongside the achievement of agreed outcomes and to consider mitigations that would be needed to address financial problems that could arise in different scenarios.

There is still significant work to be done to enable the measurement of key outcomes – both in terms of a baseline position and any future performance – so that these can be linked robustly to payment. The approach will see the local population assigned to different groups including: people who are healthy, those who have episodes of serious illness; those with one or more long-term conditions; those at the end of life; and people who are frail or with dementia.

Mr Costello said that work was being undertaken to bring numerous data sets together at patient-level across the relevant organisations – all using pseudonymised information. There had also been early attempts to establish average costs per person per segment, although this was currently undermined by incomplete data. For example it can be difficult to identify all costs related to the treatment of patients with dementia.

He said that progress towards outcome-based commissioning had benefited from good organisational relationships locally, a shared vision and close work across all bodies to develop the approach and outcome measures.