nsw - our new approach taking the next steps in engaging ... · nsw health funding model 15 neville...
TRANSCRIPT
HFMA– November 2017
Neville Onley, Executive Director ABM
Susan Dunn, ABM Manager, Stakeholder Engagement
NSW - Our New Approach
taking the next steps in
engaging clinicians
Activity Based
Management
drives evidence-based decisions. It utilises patient level costing data to inform clinical, operational and strategic objectives. This contributes to maximising value for patient care.
Evolution from ABF
Susan Dunn2
The building blocks : ABC | ABF | ABM | VBM
Alfa D'Amato3
VBM
ABM
ABF
ABC
“For patients, this means safe, appropriate, and
effective care with enduring results, at reasonable cost.
For us, it means employing evidence-based medicine
and proven treatments and techniques that take into
account the patients' wishes and preferences. A critical
component of understanding value is measurement..’ #Darthmouth-Hitchcock
Transformation Journey
Susan Dunn4
Transparency
Responsiveness
Engagement
Applicability
Influencing
Simplicity
Patient Complexity
Transparency: NSW health funding model
Alfa D'Amato5
$0M
$2,000M
$4,000M
$6,000M
$8,000M
$10,000M
$12,000M
$14,000M
$16,000M
$18,000M
Historical Block Budgets NSW New Funding Model
Acute vol* price
ED vol* price
NA vol* price
Sub-acute vol* price
MH vol* price
Other block
Teaching, training & research
State only block
District & Network 2017/18 Initial GF Budget
Growth & Escalations
9%
13%
4%
8%
5%
3%
14%
45%
Funded by ABF
Block funding -applies where it is not practical
to implement ABF
Non-admitted includes Community Health
OutpatientsHome Visits
Applicability/Influencing: Costing Data
Susan Dunn6
PPM 2 Cost per encounter
Health information exchange
Allied Health
General ledger
Pharmacy
Operating theatre
Imaging
Pathology
Inpatient activity from
PAS
Emergency Care activity
7
What is a NWAU?(National Weighted Activity Unit)?
The NWAU is the ‘currency’ used to express the price weights for all services funded on an activity basis
Tier 2: 20.22 Cardiology = 0.0520 NWAU
DRG A10Z Insertion of Ventricular Assist Device (VAD) = 65.1977 NWAU
Ave = 1 NWAU
Relative cost of hospital services
Susan Dunn
Complexity:
Price Purchasing
-$40M
+$62M
^+$2M
+$460M
-$65M
+$11M
Levers over last two years
Susan Dunn
Balance:
NSW Health Funding Model
Design and Principles
Susan Dunn10
Transition GrantsIncentives
Rural Districts
Recognised
Structural CostPrice Setters
Transparency:
Transition Grants 2017/18
11
Transition Grants (TG) - If a LHD/SHN is operating above the State Price, they receive transition grants. TG is the difference between the State Price and the LHD/SHN Projected Average Cost (PAC) to keep the system safe and operating, with expectation that TG will be removed eventually.
Acknowledging that rural LHDs face challenges in achieving economies of scale, RSC was introduced not to penalise regional LHDs.
$40M $43M$57M
$18M $7M$36M
$201M
$140M
$53M
$27M
$13M
$13M
$30M
$35M
$26M
$35M
$30M
$29M
$23M
0
50
100
150
200
250
2012/13 2013/14 2014/15 2015/16 2016/17 2017/18Financial Year
NSW Health Acute/ED Transition Grants
Transition Grants (Regional) Transition Grants (Metro) RSC Growth Funded
$311M
Susan Dunn
Value Generation:
Schedule C
Neville Onley12
Service Agreement,
Schedule C & Budget Notes
Neville Onley14
Transparency/Influencing:
NSW Health Funding Model
Neville Onley15
The NSW health funding model is built on the following components:
Activity Based Funding (ABF) [Base Activity (x) PAC] (+) [Growth Activity (x) State Price]
Small Hospitals Funding Small Hospital's Funding Model
Block Funded Services Historical Allocations for Teaching, Training and Research, Population Health & other State-Only funded services
Simplicity:
Neville Onley16
Transparency Continuum Schedule C
ABF Funding
Block & State Only
Block Funding
Provisions, Adjustments &
Restricted Assess
Transition Grants &
Recognised Structural Cost
Neville Onley18
Engagement/ Responsiveness Approach to Block
Funded Services
Public hospitals or public hospital services not in scope for ABF
will be block funded on the basis of NSW Small Hospital Model.
These historical allocations apply to; NSW Direct Teaching, Training and Research (TTR)
Standalone Specialist Hospitals (psychiatric hospitals & standalone major city hospitals providing specialist services)
Population health and Aboriginal Health
Aged care related services
Small Hospitals
(Funding Model)
Neville Onley19
The formula for calculating State Price is
(Variable Cost x State Weight Activity) + Fixed cost.
This formula allows for variable cost to be pegged
to the State Price for purchasing additional activity.
NSW Health Small Hospitals Funding Model 2017/18 is based on a linear regression
between escalated cost and State Weight to produce State Price.
2017/18 Budget State Price = ($4,250 per NWAU activity x SW Activity) + $1.2M
Responsiveness to
Clinical Initiatives
Responsiveness Recognised Structural
Costs(RSCs)
Allocated to 4 rural LHDs
The five high cost outputs that have been identified for rural Districts are: Visiting Medical Officer (VMO)
Patient Transport
Imaging
Salary and Wages Administration (SWADMIN)
Domestic Supply (DOMSUPPLY)
Methodology based on PE NWAU and upper limits of an Regression model being deemed as non controllable by LHD
Neville Onley21
Recognised Structural Cost
Neville Onley21
ABM – Monthly Monitor
Neville Onley22
Providing the Tools
Providing the Tools
ABM Portal
Alfa D'Amato23
ABM Portal
Susan Dunn24
Providing the Tools
DESCRIPTION An online patient and
activity data interrogation application to
compare and benchmark hospital performance
and examine real patient journeys across
facilities and over time.
PURPOSE To assist clinicians and managers
in managing unwarranted cost and clinical
variation, evaluating models of care and
identifying the impact of funding on patient
care delivery.
CURRENT STATUS Available to all NSW
Local Health Districts (LHDs), Specialty Health
Networks (SHNs) Clinicians and Managers.
Clinician Engagement
Susan Dunn25
Awareness ABM Portal, UCV
Action Understand the rules
Understanding Redesign process locally
Habit Model of care performance
Mastery Business as Usual
Business Case development
Curator Process to gain Insight
Local Health District
Hospital
Specialty
Disease process
Patient journey Appropriate
Safe
Timely intervention
Safety and Quality: ED Sepsis
Susan Dunn26
Awareness
Susan Dunn27
Start Date Class ED Diagnosis
DNR
Patient
No Representation
Avg Cost Per
NWAU(17)
IP ALOS
(Days)
ED ALOS
(Hrs)
31/08/2015 016 - Adm_T2_Circulatory system illness I20.0-Unstable angina J225-0000106166N $7,482 N/A 10.65
31/08/2015 F60B - CIRC DIS+AMI-INVA INV PR,T<5D - J225-0000106166N/A $13,120 3.00 N/A
7/09/2015 081 - Adm_T2_Urolsys illness N17.9-Acute kidney failure unspecif ied J225-0000106166N $2,764 N/A 4.15
7/09/2015 L67A - OTH KIDNY&URNRY TRCT DIS, MAJC - J225-0000106166N/A $9,198 9.00 N/A
18/09/2015 40.59 - Post Acute Care - J225-0000106166N/A $3,119 N/A N/A
3/02/2016 080 - Adm_T2_Sys infection A41.9-Sepsis unspecif ied J225-0000106166N $3,566 N/A 4.17
3/02/2016 J64A - CELLULITIS, MAJC - J225-0000106166N/A $8,842 12.00 N/A
18/02/2016 40.59 - Post Acute Care - J225-0000106166N/A $3,119 N/A N/A
21/03/2016 057 - N-A_T3_All other MDB groups L98.9-Disorder of skin and subcutaneous tissue unspecif ied J225-0000106166N $6,407 N/A 3.58
22/03/2016 019 - Adm_T3_Blood/Imm syst illness A41.9-Sepsis unspecif ied J225-0000106166Y $3,048 N/A 3.67
22/03/2016 F75B - OTHER CIRCULATORY DIS, INTC - J225-0000106166N/A $9,658 13.00 N/A
30/05/2016 116 - N-A_T5_Illness of the skin L03.9-Cellulitis unspecif ied J225-0000106166N $9,266 N/A 3.00
Safety and Quality: ED Sepsis Awareness
Nepean:
I09 Spinal Fusion
28
Understanding
to Insights
Northern NSW
Totally Hip KneeHabit to Mastery
1 :10 patients represented to ED within
21 days
110 bed daysrisks associated with hospitalisation
negatively impacts patient flow
135Kineffective use of resources
6 : 10 patients reported they were not clear
about what to expect
Case for Change: Project Objectives:
To reduce ALOS for Elective TKR and
THR to below peer average by June
2017
To reduce Ave Cost per NWAU for
Elective TKR and THR to below peer
average by June 2017
90% of patients will report that the
information they received adequately
prepared them for managing after
discharge
Redesign Process
30
Habit to Mastery
Northern NSW
Totally Hip Knee
Susan Dunn31
Habit to Mastery
ABM Portal in Action
Susan Dunn32
• SES Service Rationalisation,
• 17 projects underway,• Established Thrombosis service at Sutherland
• Ophthalmology Lens Business case decision
• Sensible Test Ordering Project –Pathology
• Specialty Reviews –Vascular, Renal, Neurology, Cardiothoracic
• LHD Variation Reviews with actionable Insights
• NBMLHD, MLHD, SESLHD Surgery
• ACI Redesign Schools• Totally Hip and Knee,
• Improving Utilisation of MH beds:
• Pathology Ordering Patterns at WNSW,
• Readmissions within Cumberland,
• Redesign of Midwifery Services, Macksville
Key Message
Susan Dunn33
• Extensive accessible data, capitalise on the ABM tools
• Understanding your hospital/specialty activity and cost to influence your
Clinicians
• Working with Clinicians, you can’t expect them to do it on their own
• Together shape the funding allocation decisions
• A transformational journey which requires you to evolve and embark
on capability building