Payment By Results Research Articles

Payment by Results and Adult Critical Care

This article outlines the present position regarding Payment by Results (PbR) for adult critical care services. It does not include paediatric or neonatal services because, although very similar processes are being followed for these services, the issues raised and the timetable that applies are different to those for adult services.

Payment by results (PbR) in orthopaedic trauma: Where are we losing?

Background: Clinical coding has attracted significant interest recently as it has become synonymous with reimbursement. We hereby present the results of first and largest study in the UK involving 547 orthopaedic trauma cases wherein a meticulous in-depth analysis was performed.

A performance and theoretical cost analysis of endobronchial ultrasound-guided transbronchial needle aspiration in a UK tertiary respiratory centre

New innovative techniques can improve patient care but may not be appropriately funded. Endobronchial ultrasound-guided transbronchial needle aspiration (EBUS) offers a minimally invasive mediastinal staging and diagnostic method for suspected lung cancer. We report the performance and cost analysis of a newly established EBUS service in a prospective real world cohort of patients to assess the impact of Payment by Results (PbR). Prospective cohort study. Fifty-four patients between June 2008 and April 2009 underwent EBUS for evaluation of unexplained mediastinal lymphadenopathy on CT. Cost analysis was performed from local Trust financial data and 2008-09 tariffs. EBUS had an 89% sensitivity, 75% negative predictive value and 92% accuracy for malignancy. EBUS coding was inaccurate in 15.6% of cases. The actual cost of an EBUS is 1252-1433 pounds but is coded as a standard bronchoscopy (561 pounds). EBUS reduces health community costs by 107824 pounds/year, as a result of a Primary Care Trust cost saving of 113968 pounds/year and a Trust cost deficit of 6144 pounds/year. Coding inaccuracies further alter the Primary Care Trust costs. Medical innovation is fundamental to improved patient care. EBUS can potentially reduce morbidity for lung cancer patients and save health community costs. However, with PbR the service provider delivers this at a loss as the tariffs do not reflect innovation and because of coding inaccuracies. We suggest tariffs for innovative procedures need to reflect the true cost.

Payment by Results and delayed discharges

Delayed discharges caused by social services could potentially pose a financial risk for hospitals. In 2003, the English Government introduced a controversial policy based on fines for social services departments unable to discharge patients from hospital within set timescales. This article analyses the implicit relationship between Payment by Results (PbR) and the Delayed Discharges Act (DDA), and highlights some of its most relevant features.

Payment by results (PbR) in orthopaedic trauma: Where are we losing?

Payment by results (PbR) in orthopaedic trauma: Where are we losing?

Payment by results (PbR) in orthopaedic trauma: Where are we losing?

Payment by results (PbR) in orthopaedic trauma: Where are we losing?

The Payment by Results (PbR) national tariff severely penalises efficiency and early hospital discharge

The system of Payment by Results (PbR) was instituted in 2005 to reimburse secondary care for its activity. One of the features of PbR is the short stay tariff (SST), in which only 20-50% of the national tariff is paid if patients have a length of stay (LoS) of less than 2 days in hospital for certain Healthcare Resource Groups (HRGs) – or conditions. We analysed the admissions under Acute Medicine at Bradford Teaching Hospitals over a period of one year and identified the HRGs to which the SST applied. We used the 2007 PbR national tariff to calculate the additional income that would have been generated if these patients were kept in hospital for at least 2 days in order to avoid SST. We calculated an extra theoretical income of approximately £5 million if all these patients had a length of stay (LoS) more than 2 days to avoid the SST. Sixteen additional beds (assuming 85% occupancy) would have been required at a cost of around £1million per year to accommodate these patients. We show that the current PbR system is flawed and penalises hospitals with a higher turnover of patients.

Retrospective analysis of Healthcare Resource Group coding allocation for local anaesthetic video-assisted 'medical' thoracoscopy in a UK tertiary respiratory centre

Correct service costing is essential but may not always be done accurately. To assess the accuracy of Healthcare Resource Group (HRG) coding allocation for patients undergoing local anaesthetic video-assisted thoracoscopy (LAVAT) against predicted codes under Payment by Results (PbR). Single centre retrospective study. Tertiary respiratory centre in Leicestershire. One hundred twenty-five patients undergoing LAVAT from July 2005 to July 2008. Predicted and actual revenue per LAVAT episode based on predicted and actual HRG codes allocated. Among 125 patients undergoing LAVAT, the actual HRG code matched the predicted code in only 39 cases (31.2%), odds ratio (OR) 0.002, 95% confidence intervals (CIs) 0.0001-0.03, P < 0.0001. In 51 cases (40.8%), this resulted in a median (interquartile range) excess of PbR revenue of 574 pounds (574-1366) per episode; a total estimated overspend of 29,274 pounds. In 35 cases (28.0%), this resulted in a median underspend of --1093 pounds (-1285 to -851) per episode; a total estimated underspend of 38,529 pounds, with a total estimated financial error of 67,529 pounds. The net median (interquartile range) difference for PbR-related revenue was 0 pounds (-89 to + 574). Factors associated with coding discrepancy were longer length of stay (OR = 2.52, 95% CIs = 1.09-5.81, P = 0.03) and talc pleurodesis (OR = 2.25, 95% CI = 1.01-4.99, P = 0.06). HRG coding allocation errors occur frequently. The potential financial implications of this are significant for providers and commissioners. Future strategies are required at multiple levels (NHS Trust, Primary Care Trust and Department of Health) to minimize future discrepancies and financial error.

Costing orthdopaedic interventions

Under payment by results (PbR) hospitals receive the bulk of their income from the healthcare resource group (HRG) tariff. The tariff in each HRG is the weighted average cost for all English hospitals. A key assumption within the national tariff is that all procedures or admissions with the same clinical codes must cost the same, irrespective of the specialty in which the activity occurs. It has always been stated that the groups of codes that make up a HRG are iso-resources, i.e. cost roughly the same (Jones, 2001; The NHS Information Centre (NHS IC), 2007).

Do patient surveys work? The influence of a national survey programme on local quality-improvement initiatives

Objectives:To assess current attitudes towards the national patient survey programme in England, establish the extent to which survey results are used and identify barriers and incentives for using them.Design:Qualitative interviews...

Findings of the national PbR data Assurance Framework: improving the quality of data underpinning payment by results using benchmarking to target clinical coding audits

Since 2003/04 the Department of Health (DH) has been progressively implementing a prospective payment casemix funding system, known as Payment by Results (PbR), so that in 2008/09 over 90 percent of acute inpatient activity is reimbursed through PbR. The accuracy of the data recorded for each episode of care can directly influence the accuracy of reimbursement between commissioners and providers under PbR. In 2006, the Audit Commission was approached to develop a national data assurance framework for PbR. A pilot study found an average HRG error rate of 11.9 percent with considerable variation between trusts. The financial impact of the errors on payments represented between 5 percent and 14 percent of the total sample value. Following from the pilot, in 2007/08 the Commission began a national programme of PbR data assurance at all NHS acute trusts. This paper explains the components which make up the PbR Assurance Framework today; the particular contribution that benchmarking makes to the process; and the results from the first full year of audits.

Practice Based Commissioning

Through a number of different mechanisms, practice-based commissioning (PBC) was intended to improve patient care. Firstly, it was meant to increase clinician involvement in the commissioning of new services for patients. Secondly, PBC made it easier for GPs to develop new services themselves. Thirdly, through the greater familiarity of local budgets and Payment by Results (PBR), GPs were meant to feel financially accountable for their referral decisions.

Implementing payment by results in the English NHS

This paper draws on economic theory and empirical evidence in order to explore the role of incentives and information in the successful implementation of the new hospital funding system in the NHS. The research is based on case studies in two strategic health authorities comprising in-depth interviews with key stakeholders and analysis of background statistics and documentation. The structure of tariffs under payment-by-results (PbR) provides high-powered incentives for providers to increase activity because they are rewarded for hospital activity, and payments for increases in activity are made at full average cost. However, there is a danger that hospitals will increase activity beyond affordable levels and possibly induce demand inappropriately. In future, as PbR is extended, it will be important to monitor its intended and unintended effects. Such evaluation should consider the extent to which commissioners are able to live within their budgets and whether hospitals are engaging in opportunistic behaviour and gaming the new funding system. This study has shed light on the incentive structure of PbR for NHS organisations and has provided insights for the development of information strategies for providers and commissioners in the NHS market. It also highlights a number of policy issues that need to be addressed as PbR is rolled out nationally as well as several important gaps in knowledge that are in need of more sustained investigation.

The cost of renal dialysis in a UK setting--a multicentre study

The UK National Health Service (NHS) will fund renal services using Payment by Results (PbR), from 2009. Central to the success of PbR will be the creation of tariffs that reflect the true cost of medical services. We have therefore estimated the cost of different dialysis modalities in the Cardiff and Vale NHS Trust and six other hospitals in the UK. We used semi-structured interviews with nephrologists, head nurses and business managers to identify the steps involved in delivering the different dialysis modalities. We assigned costs to these using published figures or suppliers' published price lists. The study used mixed costing methods. Dialysis costs were estimated by a combination of microcosting and a top-down approach. Where we did not have access to detailed accounts, we applied values for Cardiff. The most efficient modalities were automated peritoneal dialysis (APD) and continuous ambulatory peritoneal dialysis (CAPD), the mean annual costs of which were pound21 655 and pound15 570, respectively. Hospital-based haemodialysis (HD) cost pound35 023 per annum and satellite-unit-based HD cost pound32 669. The cost of home-based HD was pound20 764 per year (based on data from only one unit). The main cost drivers for PD were the costs of solutions and management of anaemia. For HD they were costs of disposables, nursing, the overheads associated with running the unit and management of anaemia. Renal tariffs for PbR need to reflect the true cost of dialysis provision if choices about modalities are not to be influenced by erroneous estimates of cost. Knowledge of the true costs of modalities will also maximize the number of established renal failure patients treated by dialysis within the limited funds available from the NHS.

PbR yet to improve efficiency.

Payment by Results (PbR) has helped hospitals to become more business like but has yet to increase NHS efficiency signif icantly, according to the Audit Commission.

Counting the costs: The risks of regulating and accounting for health care provision

Payment by Results (PbR) is one of the most fundamental changes in NHS policy since the introduction of the ‘internal market’ in 1991. It is also one of the most visible and influential attempts across the same period to modernize the NHS through accounting and, more specifically, costing. As a funding system, PbR promises to pay providers fairly and transparently by using a ‘standard national tariff.’ However, like all accounting based reforms, PbR encounters the range of professions and expertises active in the domain. Like all costing systems that give visibility where previously it was lacking, PbR creates new calculable spaces and new risks. The aim of the paper is threefold. First, we seek to chart the nature of the arena within which PbR operates. We identify the multiple actors that are influential in the regulatory field of health service provision, and focus on three types of actor in particular, namely the National Institute for Health and Clinical Excellence (NICE), Monitor and professional medical associations. We argue that these three actors need to be viewed as representative of different types of expertise (schematically speaking, health economics, accounting and medicine) and that, to understand fully the nature of the regulatory game in the healthcare arena, PbR needs to be analysed not as a stand alone intervention but as enmeshed within the inter-professional complex that emerges out of the interaction of these three types of expertise. Second, we argue that we need to focus on the ways in which PbR, along with other regulatory interventions in the healthcare field, such as those of NICE and Monitor, seek to create new and sometimes competing calculable spaces based on different entity assumptions. Third, we argue that to understand empirically the dynamics of healthcare reform in the UK we need to examine the extent to which PbR creates new calculating selves, or a hybridizing of the calculating and medical self. The regulatory complex within which PbR operates may, we argue, produce contradictory incentives and thereby contribute to systemic provision risks.

Working for nothing! Payment by results shortfall in an ENT unit

Many NHS Trusts are currently experiencing severe financial problems, with many resorting to compulsory redundancy for staff in order to balance the books. In 2005 the Department of Health (DH) introduced a system of payment by results (PbR), by which health care Trusts charge the Primary Care Trusts (PCTs) for the care and ser vices they provide. PbR represents a dramatic change to the way in which funds flow through the health care system. The aims of PbR are to ensure services are appropriately rewarded while creating financial incentives for Trusts as well as to 'support wider reform'. This system is based on a series of codes and has pushed the role of clinical coders to the fore in NHS Trusts. Every patient contact with the Trust, every diagnosis and every procedure performed generates a particular code from which a predetermined fee can be calculated.

Activity based financing in England: the need for continual refinement of payment by results

The English National Health Service is introducing activity based tariff systems or Payment by Results (PbR) as the basis for hospital funding. The funding arrangements provide incentives for increasing activity, particularly day surgery, and, uniquely, are based on costing data from all hospitals. But prices should not be based on average costs and the potential of PbR to improve the quality of care is yet to be exploited. Without refinement, PbR threatens to undermine expenditure control, to divert resources away from primary care, and to distort needs based funding.

Payment by results for fractured neck of femur in two NHS Secondary Care Trusts

The NHS is in the midst of widespread financial and personnel restructuring. A cost-efficient organisation with effective Secondary Care Trust payment structure was envisaged in the government paper Delivering the NHS Plan. Payment by results (PbR) was introduced into the NHS in 2004 in an effort to finance Trusts fairly and reward work volume. PbR is a cost-per-case fixed national payment system based on Healthcare Resource Groups (HRG). A reduction in waiting times, increased productivity and better use of capacity are expected benefits. An improvement in data collection is anticipated. Similar payment structures are used in Europe, the US and Australia. PbR aims to create an individual tariff for each hospital patient episode. Primary Care Trusts (PCTs) will pay this tariff for the treatment of each individual patient in their resident population.

PbR 'should better reflect' nurse contribution.

The RCN is calling on ministers to ensure that the Payment by Results (PbR) tariff better reflects the contribution of nursing to the provision of NHS services.