Practice based commissioning
GP Partner, The Ridgeway, Surgery, Worcestershire, UK
E-mail: richard.davies2{at}nhs.net
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Abstract |
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 TOP Abstract What the GP curriculum...Why do I need...Indicative budgetUse of freed-up resourcesHow are GPs coming...PBC and commissioningPBC and providingPayment by resultsThe PBC planReduction of wasteWhere can I learn...References |
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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.
The core statement: Being a General Practitioner Domain 1.4. To master effective and appropriate care provision and health service utilization requires knowledge of the structure of the health care system and the function of primary care within the wider NHS. An understanding of the process of referral into secondary care and other care pathways is required. Domain 5.1. To reconcile the health needs of individual patients and the health needs of the community in which they live, balancing these with available resources. This requires an understanding of GPs’ role in the commissioning of health care.
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Why do I need to know about PBC? |
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TOPAbstractWhat the GP curriculum...Why do I need...Indicative budgetUse of freed-up resourcesHow are GPs coming...PBC and commissioningPBC and providingPayment by resultsThe PBC planReduction of wasteWhere can I learn...References |
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PBC is one of a raft of recent reforms to be introduced by the government. PBC sits alongside PbR, Choose and Book (C&B) and independent sector treatment centres. For anyone working in the health care profession, it is important to have a basic knowledge of new initiatives as they may be relevant both directly and indirectly.
Job interviews are a fact of life and the GP job market is becoming increasingly competitive. Clinical medicine is the core function of a working GP but the management and strategic planning roles are also important. Candidates with a working knowledge of PBC would show awareness of the wider political primary care landscape. It could be a topic of discussion at the end of an interview, for example, ‘Do you have any questions for us? Yes, how is your practice taking on the challenges of PBC? Have you joined with other local practices and if so are you developing any new services?’
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Indicative budget |
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TOPAbstractWhat the GP curriculum...Why do I need...Indicative budgetUse of freed-up resourcesHow are GPs coming...PBC and commissioningPBC and providingPayment by resultsThe PBC planReduction of wasteWhere can I learn...References |
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Each practice should now have an indicative budget, this is the amount of money its patients have cost the NHS through secondary care services. The indicative budget can be called a referral footprint. It is not part of the global sum which is the money given to a practice to provide primary care. The indicative budget covers most aspects of secondary care and prescribing and tests (Box 1). The budget is still held by the Primary Care Trust (PCT) and the PCTs are still responsible for balancing the books, that is why it is called an indicative and not a real budget.
Box 1. Minimum requirements of indicative budget
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The Department of Health (DoH) is moving away from a historical activity for working out an indicative budget and moving towards a formula, based on a fair share system.
If a practice has an actual expenditure which is less than the predicted indicative budget, then 70% of these savings are available for reinvestment in to new services, training or equipment.
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Use of freed-up resources |
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TOPAbstractWhat the GP curriculum...Why do I need...Indicative budgetUse of freed-up resourcesHow are GPs coming...PBC and commissioningPBC and providingPayment by resultsThe PBC planReduction of wasteWhere can I learn...References |
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After approval by the PCT, practices have a choice as to how they spend any savings (Box 2). As savings are not guaranteed from one year to the next, employing staff on long-term contracts may be problematic. Spending may be targeted at reducing unscheduled admissions as a small reduction in episodes would produce large savings. Savings for each individual practice would be small and vary widely from year to year; this risk would reduce as GPs group together and pool ideas and financial budgets.
Box 2. Possible uses of freed-up resources
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How are GPs coming together? |
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TOPAbstractWhat the GP curriculum...Why do I need...Indicative budgetUse of freed-up resourcesHow are GPs coming...PBC and commissioningPBC and providingPayment by resultsThe PBC planReduction of wasteWhere can I learn...References |
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Many GPs and practice managers have come together to tackle the challenges of PBC. Some have formed legal bodies and limited companies while others are working together in informal groups. There is advice available as how best to do this. PBC is voluntary and many GPs are superficially involved and elect a group of GPs to spend more time developing and implementing new ideas. As with all aspects of practice management, time spent working on PBC is time not seeing patients. When practices come together, they often sign an informal agreement to share data and other information (Box 3).
Box 3. Suggested headings for an informal interpractice agreement
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PBC and commissioning |
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TOPAbstractWhat the GP curriculum...Why do I need...Indicative budgetUse of freed-up resourcesHow are GPs coming...PBC and commissioningPBC and providingPayment by resultsThe PBC planReduction of wasteWhere can I learn...References |
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This part of PBC involves helping to commission services and reduce waste. Once the group identifies a clinical area or service which could be improved, then a list of requirements is produced setting out what is needed. This would then be put to tender and any willing provider could apply to do the work. The provider would then draw up an action plan outlining how they would meet the clinical requirements.
Also, work would be done initially in-house looking at effective and efficient use of pathology tests and secondary care referrals.
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PBC and providing |
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TOPAbstractWhat the GP curriculum...Why do I need...Indicative budgetUse of freed-up resourcesHow are GPs coming...PBC and commissioningPBC and providingPayment by resultsThe PBC planReduction of wasteWhere can I learn...References |
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Some GPs involved in PBC are coming together to provide services which were traditionally hospital based. These PBC providers would need to produce a business case for any new service (Box 4). Possible services could include GPs with special interests (GPwSI) in dermatology, musculoskeletal or cardiology. A GP or practice nurse could train in acupuncture for back pain or other musculoskeletal pain.
Box 4. Heading for a business plan for a new service
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There are a number of governance issues that relate directly to providing a new service. For the groups providing services, there are training and validation issues for the staff they employ, for example, relating to GPwSI.
If services are to be moved from hospitals to the community, the impact of this should first be assessed in detail. The possibility of destabilizing local hospitals should be taken into account when assessing up new services.
Separate to this, there is a potential conflict of interest between the commissioner and provider roles of PBC groups. GP could both commission care locally and then bid for and provide a service locally. GPs who are assessing business cases for new services must exclude themselves from decisions in which they have a direct interest.
The General Medical Council document Good Medical Practice states ‘If you have a financial or commercial interest in an organization to which you plan to refer a patient for treatment or investigation, you must tell the patients about your interest’. This issue would need to be addressed when GPs start referring to services set up by their own PBC provider group.
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Payment by results |
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TOPAbstractWhat the GP curriculum...Why do I need...Indicative budgetUse of freed-up resourcesHow are GPs coming...PBC and commissioningPBC and providingPayment by resultsThe PBC planReduction of wasteWhere can I learn...References |
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Hospitals used to be paid a sum of money each year to prove a block of services. For example, each hospital used to get X million to provide Y services for Z population. Things have now changed, and each hospital or ‘provider’ will get a set amount of money for each operation or procedure. Similar episodes of care have been lumped together into a huge list of care episodes. The similar episodes of care are called health care resource groups (HRGs) (Box 5, 6 and 7). Every hospital is then paid for every HRG they claim for, the PCT will pay each hospital a set amount, and this is called the National Tariff.
Box 5. Inpatient costs 2007–08
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Box 6. Outpatient costs 2007–08
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Box 7. Accident and Emergency (A&E) costs 2007–08
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In general, emergency admissions cost much more than planned elective admissions for the same complaint and cases with complications cost more than cases without complications.
With such a new and complex system, there are bound to be errors in coding. At some level the HRGs claimed for by clerical staff have to be checked against what care has actually occurred. This would be best done by the patients GPs who are best placed to know their patients and know what has recently happened to them. It has been predicted that without some type of checking PbR costs could spiral upwards; PBC has been described as one of the best counter levers to PbR. Recently, the Audit Commission has recommended PCTs and practices engage better with the data validation processes.
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The PBC plan |
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TOPAbstractWhat the GP curriculum...Why do I need...Indicative budgetUse of freed-up resourcesHow are GPs coming...PBC and commissioningPBC and providingPayment by resultsThe PBC planReduction of wasteWhere can I learn...References |
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Each financial year a practice or group of practices agrees a PBC plan with the PCT. It outlines what is expected from each party. The plan outlines the practice name and the lead PBC clinician. It outlines the scope of the indicative budget (Box 1). Ideally, there is a local needs assessment, undertaken by taking soundings from as many stakeholders as possible. Then, the work to be done by the practice and the PCT is listed. It is important to outline in the plan how the practice intends to spend any savings. Finally, the time finish date of the plan and arbitration procedures are included.
The DoH has made clear what it expects from PCTs in the recent key document called ‘Practical Implementation’. It states PCTs should develop a locally agreed incentive scheme to provide support for practices and provide useful activity information and financial information to practices.
There is incentive money available, at least £1.90 per patient, and this is linked into the locally agreed incentive scheme. A number of criteria will be agreed locally and payment from the PCT will depend on how well these are achieved (Box 8).
Box 8. Possible criteria for incentive scheme
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The most recent advice from the DoH has outlined what information they expect PCTs to provide practices (Box 9). In October 2006, English PCTs were restructured and this has led to some problems in this area. The PCT should compare practice activity with both the national average and the PCT average, an exercise called benchmarking.
Box 9. Data PCTs should be giving PBC groups
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Reduction of waste |
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TOPAbstractWhat the GP curriculum...Why do I need...Indicative budgetUse of freed-up resourcesHow are GPs coming...PBC and commissioningPBC and providingPayment by resultsThe PBC planReduction of wasteWhere can I learn...References |
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If GPs have a financial stake in the whole PCT budget through their indicative budgets then they may take a broader view of the cost of individual episodes of care. Take the example of cholesterol management in stroke and coronary heart disease. A total cholesterol should be requested once a year at the annual review, the HDL levels and triglyceride profile are not always needed. This could be done either as a lipid profile or a total cholesterol. A full lipid profile costs the PCT about £4 while a total cholesterol blood test costs around £2. It makes little difference to GPs if they ask for more cholesterol tests for follow up of patients and restrict full lipid profiles to initial coronary heart disease risk assessment. In this example, ticking the box on the pathology form is a commissioning decision. The doctor commissions a cholesterol or lipid blood test from a local hospital and the local hospital charges the PCT for this test. If 500 patients were switched from annual lipid profile to total cholesterol, the practice would save £1000 per year every year. Through PBC, savings like this would be reinvested into patient care without any reduction in quality of care.
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Where can I learn more about PBC? |
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TOPAbstractWhat the GP curriculum...Why do I need...Indicative budgetUse of freed-up resourcesHow are GPs coming...PBC and commissioningPBC and providingPayment by resultsThe PBC planReduction of wasteWhere can I learn...References |
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There are a number of organizations providing support and advice on PBC (Box 10). The introduction of PBC just before the PCT reorganization in 2006 led to variations in PCT support and though there is support for PBC, but in a recent survey, only 12% of those questioned felt that PBC had improved patient care.
Box 10. Organizations who offer support or information about PBC
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Key points
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References |
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TOPAbstractWhat the GP curriculum...Why do I need...Indicative budgetUse of freed-up resourcesHow are GPs coming...PBC and commissioningPBC and providingPayment by resultsThe PBC planReduction of wasteWhere can I learn...References |
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Audit Commission. Putting commissioning into practice: Implementing practice based commissioning through good financial management. Accessed via www.audit-commission.gov.uk/reports/NATIONAL-REPORT.asp?CategoryID=&;ProdID=67664124-E760-4e93-81BB-A0A871EA885E [date last accessed 12.06.2008].
British Medical Association. Practice based commissioning: consortium working. (2006) Accessed via www.bma.org.uk.
Department of Health. Determining practice fair shares budgets: toolkit and guidance. Accessed via www.dh.gov.uk/en/publicationsandstatistics/publications/publicationspolicyandguidance/DH_4127155 [date last accessed 12.06.2008].
Department of Health. Practice based commissioning: practical implementation. (2006) Accessed via www.dh.gov.uk/en/Publicationsandstatistics/Publications/PublicationsPolicyAndGuidance/DH_062703 [date last accessed 12.06.2008].
Department of Health. Practice Based Commissioning: GP practice survey: Wave 2. (September 2007) Accessed via www.dh.gov.uk/en/Publicationsandstatistics/Statistics/DH_082156 [date last accessed 12.06.2008].
General Medical Council. Good Medical Practice. (2006) Accessed via www.gmc-uk.org/guidance/good_medical_practice/index.asp [date last accessed 12.06.2008].
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