Post edited 19.7.2011
“It’s about knowing how to play the game”
Local commissioning executive
Because of the purchaser-provider split which was introduced to the NHS in the 90s by Kenneth Clark, we (GPs) are purchasers and hospitals are providers and so we pay every time our patients attend hospital. This is what makes the ‘any willing/qualified provider (AWP/AQP) proposed in the government’s health bill possible.
GP commissioning is sold to you the public as a concept whereby GPs design and commission the services you need from hospitals. It is why the government keep saying they are giving GPs control. The pro-market reformers enthuse that you, the patients, will get better quality care and we, the GPs, will save money because the hospitals will have to compete with each other to provide the cheapest, best quality service.
If you think we are going to be endlessly decommissioning and recommissioning services according to cost and quality, you are mistaken. Commissioning is a time-consuming, expensive, complicated business. We have been offered £20 per patient to do the administrative business that our PCT was doing for £60. We do not have the time or the money. You need us in our consulting rooms.
However, you will be pleased to hear that we are commissioning some excellent services from our local hospital including 29 care pathways. But the government say…
“You can choose any hospital in England funded by the NHS (this includes NHS hospitals and some independent hospitals)” NHS Choices website
The problem then is that patients are free to choose services that we have not commissioned. In fact, they are being encouraged to choose services we have not commissioned. Not only are they being encouraged, but the Competition and Cooperation Panel has been set up to make sure we do not
collaborate collude with our local hospital where we have commissioned services.
There is a large shiny PFI hospital not so far away that our patients sometimes go, where we have not commissioned services. It is spending large but undisclosed amounts of taxpayers money on marketing. Down the road is our local hospital which is spending a lot less on marketing. The shiny hospital is costing us a lot more money and there is very little we can do about it.
“[I] cannot see gpccs [GP commissioning consortia] shaping markets, they will be buying off the shelf. Patient choice + awp [any willing provider] = no commissioning” Anna Dixon, Director of policy, King’s Fund (via twitter)
In 2008-9 our PCT asked us to look at the bills we were sent by hospitals under PBR (payment by results). A treatment episode is asigned an HRG code which has a tarif/price allocated to it. For example if a patient is seen in hospital with a major upper respiratory tract infection it costs £541(!) If they have ‘complications’ (unspecified) there is a £50 surcharge. 2008-9 must have been a bad year because almost every patient seen in hospital had ‘complications’.
Our practice looked after about 10 ooo patients in 2008-9. In total we were charged £801k by hospitals under PBR. We checked every single bill for that year. To check them you have to read every patient record and hospital discharge summary (if you get one). It takes a long time, up to 20 minutes per patient. We found reasons to challenge £700k worth of bills because of reasons such as not having received a discharge summary, being charged twice for the same episode, being charged for patients that were not registered with us, innapropriate HRG coding, inadequate information, patient not referred by us, etc. Because of the amount of time it took the PCT to look at our figures they only covered the first 2 of 10 pages of challenges we returned to them. For that we were reimbursed £323K that had been erroneously billed to us. The money covered a large part of our £363 PBR overspend, and had they looked at all 10 pages it would have more than covered it. The money reimbursed has to be paid back by the hospitals to the PCT and it is then available for referrals for the next year. It is not a direct loss (or profit) to our practice, but is pooled within the PCT and shared over more than 30 practices. Since we were overcharged at least £323k and there are approx 250k patients in our PCT that amounts to an estimated £8 075 000 overcharged by providers.
Very few practices checked at this level of detail. We were doing it ‘as a favour’ to the PCT to help them examine the scale of the problem. Our administrator who checked the data explained what was involved one month. On April 22nd the hospitals were supposed to have their data uploaded. By April 30th the PCT were supposed to reconcile it and by May 7th we were supposed to prepare our challenges. The data never arrived on time. It would come piece-meal and if you did not check your inbox regularly you would finish your challenges only to find a hundred or more new HRG codes to check. Very late nights were spent investigating.
What they discovered was shocking. One patient with a minor head injury needed glue to his scalp but the A&E department had run out so the sent him to another hospital for glueing and we were charged several hundred pounds for each A&E attendence. A psychiatric inpatient attended A&E every day during his admission, but never got past the reception but we were charged £50 every time. A woman who was pregnant was admitted with pneumonia and then delivered her baby, but stayed in becasue of her pneumonia and we were charged a maternity rate (approx double a medical rate), total cost approx £30k. Patients who missed a follow up appointment were discharged and asked to see us for a new referral which costs double a follow up appointment. The major errors were for episodes for which we were charged twice, one of which cost £150k.
This was a trial. It is no longer happening because there are not enough people, time or money to keep checking at this level of detail. At present data is aggregated to give average costs or selected areas are examined, for example frequently attending patients, or antenatal care.
In the first 6 months of this year we have discovered:
A patient referred to our commissioned antenatal service is seen 8 times, but a patient seen at the shiny PFI hospital is seen 14 times. A patient seen for their first antenatal appointment at the shiny hospital had 5 separate health professional interactions for blood and urine tests,blood pressure etc. each of which was coded and we were billed.
The average number of outpatient follow-ups at the shiny PFI hospital is 4.12 compared to 2.8 at the hospital down the road. Even if the tariff was the same, a hospital can increase its profits by calling patients back more often.
The tariff for the same ENT outpatient appointment at the shiny hospital is higher, £200 vs £170 for the hospital down the road. This is supposed to cover the costs of all the polishing needed in a central london location. We pay the difference.
The re-referrals. A patient referred to a commissioned gastrointestinal service with bleeding from the bowel would be properly investigated and managed by the commissioned service. If one of our patients chooses to go to the shiny hospital they need one referral to the gastroenterologists for the stomach another referral to the surgeons for the colon.
Another way the shiny hospital makes money is by telling my patients that I need to refer them to a different specialist at their hospital. Then I have to say, “look I know Professor Spratt said you need to see his delightful colleague, Mr Nibbs, but I really don’t think it’s necessary” And the patient replies, “that’s just because you’re trying to save money” …
Shiny hospitals hang on to their patients with an iron grip. Most notoriously the London Integrated Hospital. Unsurprisingly for a homeopathic hospital, the patients do not get better, so they are never discharged and we pay for their supportive counselling, which is, for many vulnerable patients, very helpful, but it is very expensive form of counselling.
If we object to the bills the shiny hospital are sending us we can ‘challenge and reaon’. Sometimes an agreement is reached, but sometimes arbitration is threatened. This is far too expensive and so the threat effectively results in us coughing up. Providers like the shiny hospital have the cards in one hand, our balls in another and enormous PFI debts hanging over them. No wonder they’re squeezing.
This overtreatment by healthcare providers is a consequence of ‘perverse incentives’. As George Bernard Shaw said 100years ago,
That any sane nation, having observed that you could provide for the supply of bread by giving bakers a pecuniary interest in baking for you, should go on to give a surgeon a pecuniary interest in cutting off your leg is enough to make one despair of political humanity.
It is one of he reasons why market-based, competitive healthcare is so expensive, as US surgeon Atul Gawande showed by comparing different systems of health care delivery in the US.
Our patients are not just normal folk who are mesmerised by i-gadgets and racked up to the eyeballs on credit spent on toys they do not need or play with any more. No, they are far more likely to be undereducated and over anxious, ideal fodder for unscrupulous marketing departments of shiny hospitals. These dupesters are spending money that ought to be spent explaining how your chemotherapy works, what physiotherapy can achieve, or the risks vs benefits of knee surgery hypnotising our patients with their beautiful reflective buildings and augmented nurses. This stuff gets to people when they are making a choice. In fact it matters more than very difficult to analyse outcome data, which is much less easy to polish on photoshop. It matters less than locality or convenience for most of our patients for now, but it is very early days in the world of heavily marketed shiny i-hospitals.
It might be going too far to say the cost of patient choice is gaming. There is as much erroneous coding as deliberate over treatment. The only way to prevent this is to have armies of detective administrators meticulously examining every bill for every patient. One reason this can never work is because healthcare is not a commodity and to treat it like one is to commit a ‘category error’. Coding episodes of care is to be forever hammering square pegs into round holes. You cannot have healthcare markets without market bureaucracy. This is why administration costs in the US are at least twice what they are in the UK and why, according to Ruth Thorlby of the Nuffield Trust, the single biggest reason health care commissioners in California went bust. Because of the internal market administration in the NHS has risen by so much in recent years and transaction and administration costs account for about £10bn a year. The latest changes to NHS bureaucracy completely dwarf what we had before. This is the very opposite of what the government promised, but even that pales before what we will need if the health bill goes ahead.
If the over charges for 250k patients for our PCT are approximately £8 million per year and we assume an English NHS population of 52 million, this is approximately £1.6bn in excess charges every year. If there are insufficient resources to examine all this, as there would seem to be, you can see why the private sector providers are so keen on NHS reform.
The NHS reforms will divert money away from where it is needed and will render the NHS unsustainable in a very short time.
I believe that this might very well be the government’s intention.
Time to abolish payment by results? Prof Alan Maynard (Health Economist) Health Policy Insight
Clinical activity in the English and Scottish NHS before and after devolution. NHSCA “In summary, increases in English inpatient and day case hospitalisation rates were 26 times those in Scotland between 1998-99 and 2009-10. Increases in new outpatient referrals were 13 times greater in England than in Scotland over this period and increases in A&E attendance rates were almost four times greater.”
Up-Coding a hazard as pressure for payment by results grows. e-health insider (excellent comment