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Outcome of the Review of Incentives, Rewards and Sanctions by NHS England
Paul Baumann Chief Financial Officer
Preamble This item really concludes one of the commitments
that we made in Everyone Counts back at the start of the year, which was fundamentally
to review essentially the incentives and sanctions that are in the system, sitting alongside
the system of pricing that we have, through carry-off and other measures.
Overview of the paper What you have in front of you today is the
outcome of that particular review for your consideration. I think it recognises the vital
importance of a system of incentives and pricing measures, which do two things, really, one
of which is not to get in the way of transformation, of change, of improvement in patient services,
but secondly, more actively to actually stimulate some of the change that we need in those areas.
That is what you have in front of you. It is the product of work that has been undertaken
by the Pricing and Incentives Network, which I think is a good example of cross-directorate
matrix working with a very strong clinical representation in particular, which I think
has helped us enormously to get to where we have done. There has been extensive involvement
of the Commissioning Assembly in this, both in the form of a dedicated sub-group and the
plenary meeting of the Commissioning Assembly, where there was engagement on this particular
topic. Thirdly, it has been subject to wide engagement in the sector over the July to
September period, so the things you see in front of you have widespread support and have
been considered carefully by people throughout the system.
They sit alongside the things we have talked about separately, which are the pricing strategy
that we are pursuing with Monitor and, in particular, the engagement around the tariff
for 2014/15. Clearly, tariff needs to sit alongside a process and system of incentives,
to have that combined impact. I think it is fair to draw out the parallels between the
way we have approached tariff for 2014/15 and the way we are approaching incentives
for 2014/15, which is that, essentially, in 2014/15, we are trying to achieve stability
above all other things, because of all the challenges that are in the system. Both on
tariff and on these incentives, we have not lit the blue touchpaper of vast, radical changes;
we have tried to improve where there is good evidence that we need to improve, but there
is a degree of stability. Allied to that, I think there is a move to encouraging local
innovation in the way these things are applied, so that where there is something that local
healthcare partners around the place wish to implement, they can find their own way
within this framework of underpinning them with incentives and, indeed, underpinning
them with tariff prices. That is the philosophy that is here.
Parity of physical and mental health I am not going to go through the individual
proposals because they are set out in the paper. Members of the Board have had opportunity
to input to them at various points in this process, but obviously, we can discuss any
that are of particular concern or interest. I would draw to your attention the fact -- and
this links back right to the beginning of today's meeting -- that I think there is a
noticeable move. One of the improvements in this set of incentives is to recognise the
parity between physical and mental health. In just about every dimension of the incentives
you see in front of you, we have brought in a stronger component, I think it would be
fair to say, of mental health-related incentives to try and make sure that that is supported
in an equal way. Concluding remarks
What I am looking for today is for you to be content with -- or otherwise -- the conclusions
we have reached from the review, because we do intend to publish them, as you would expect
of our organisation. I would welcome your specific endorsement of the changes that are
set out in the paper on the individual measures that we talked about. Thirdly, there is a
formality about this, which is that we welcome your delegation to the Executive Team of the
finalisation of this work. There are, as the paper sets out, a number of details that still
need to be sorted out within this particular framework, and it is simply not practical
to wait until the next Board meeting to do all of that, because otherwise, our planning
processes and contracting processes will not get the right speed behind them. That is what
we are looking for today. I would welcome any support you can give on those fronts.
Q&A Malcolm Grant: The expectation of the Board
is, first of all, an endorsement of the approach, by which we mean also commending the process
that has been undertaken up to this point and the engagement of members of the Board
and others. Then secondly, about the key messages that are coming out from the review, and you
have touched upon local flexibility, stability and the need for it, and also, the move towards
greater parity of esteem between mental and physical health. Let me just pause at that
level and take comments before we look at some of the specific items that you are asking
us to endorse. CiarĂ¡n Devane: Overall, I get the stability
thing. I worry a bit about ambition and how we are going to get the drive behind some
of the shifts we have, and not just parity of esteem, but what about supported self-management,
what about general emotional and psychological support and all of those things?
I also have a bit of a concern that we will not get that ambition if we delegate some
of this to a sub-committee of the Commissioning Assembly, because when we started this off,
I remember saying at the time that this was so big it was something that absolutely had
to be done with the patient voice in the room as well. I think we have something that can
kind of muddle us through for the year, but I do not think we have something that is really
going to engage the patient voice with the same level of esteem as the commissioning
voice and the clinical voice. I think there is something around the process around taking
this forward to the next level that we have to do in a very, very different way.
David Nicholson: I think you are absolutely right. In a sense, this always was a short-term
piece of work. The bigger piece of work is in relation to the call to action, where we
absolutely want to look at all of this. Because the issue for me, I think, in all of this
is, what are the behaviours that we are trying to encourage in this? We can see in recent
newspaper coverage about the way incentives can sometimes operate in an organisation to
create the wrong type of behaviours. I think transparency is a really important
part of this. So, one of the things for me is if you take something like CQUIN, what
can happen with it is, and I do not mean to be rude to finance directors, but the finance
director of a trust can say, 'I assume I am going to get all my CQUIN money,' and then
build it into their budget, and then if they do not deliver on CQUIN it becomes a fining
system. So, something that started off for clinicians as an incentive to do better ends
up as a negative. And it seems to me that you get the wrong behaviours out of that.
Similarly on transparency, especially for clinicians, I was at a mental health unit
where they had a CQUIN around recovery, and they were funding a recovery nurse out of
the CQUIN money. And I went into a meeting where that nurse was working with a group
of patients who all knew that that individual was funded through CQUIN. The patient believed
that they could see transparently the way the money was running through the system,
and they thought it was a fantastic thing. It was fascinating. That was about patients
having power and control that you get through transparency, and I think there is a lot more
to do in this to make it real and get the kind of behaviours in the right place and
hopefully out of the big work we are going to do for strategy. We can get into all of
this. Victor Adebowale: I just think that it is
a start. I now understand this better because of what you have just said, to be honest.
I think it will get us, in a sense, through the night, but it does not map onto the earlier
conversations, and it clearly needs to. I do welcome it. Again, when I read it, it did
not leap out to me, as much as you have said it, about the parity of esteem issues, although
they are in there. Again, we had the conversation yesterday. It is great that it is acknowledged
in here, but we need to go a lot further a lot faster.
Malcolm Grant: On that basis, I detect reading body language around the Board -- which is,
after all, the responsibility of the Chairman -- that we are content, more than content.
I think we are very positive about this, very positive about the direction of travel, and,
putting it into the context that David has just spelt out for us, I think happy to endorse
the general approach, but also the specific recommendations, and to delegate authority
to the Executive Team to finalise the details. We are? Good. Thank you very much.