reshaping the system: implications for northern ireland’s health and social care services of...

7/30/2019 Reshaping the System: Implications for Northern Irelands Health and Social Care Services of the 2010 Spending

1/50

Reshaping the System: Implications forNorthern Irelands Health and Social CareServices of the 2010 Spending Review

Introduction

This document provides the Minister for Health, Social Services and Public Safety

with possible plans that would deliver high quality, cost effective health and social

care services for Northern Ireland in the coming years taking account of the likely

reduced funding levels anticipated in the Current Spending Review. It sets out:

The Departments assessment of the funding required to maintain Health and

Social Care in Northern Ireland (HSCNI) in its present form over the coming

years

High-level estimates of the cost saving potential of a far-reaching and

integrated programme to improve productivity and quality

A vision for a reformed health and social care service for Northern Ireland

arising from and necessary for these improvements What it will take to successfully make the transition to this future system.

The analysis underpinning this document is top-down in nature1, making

assumptions about the overall system and drawing on the experiences of other,

equivalent systems elsewhere in the UK and beyond. It does not therefore

include an impact analysis on a local basis, nor does it provide a final,

comprehensive perspective on the future shape of health and social care services.

Much remains uncertain, not least the political decision-making process and the

level of support from the public, professionals and managers to implement thereforms described. This document is therefore intended to provide the

foundation for a constructive discussion between DFP, the Minister for Health,

Social Services and Public Safety and DHSSPS on the size and nature of the

challenge and the changes required to ensure the service is fit for purpose for the

21st

century.

1 Conducted over a 5 week period during August 2010

1


2/50

This document frequently refers to quality and productivity. A high-quality

service is effective, safe, ensures people from all sections of society who need

care can easily access it, and is patient or user centred, providing a good user

experience. A productive service makes efficient use of all resources, includingfacilities, staff and supplies. Productivity covers both allocative efficiency (i.e.,

the right services being provided in the right setting) and technical efficiency

(i.e., right people working effectively in the right place at the right time within

each setting of care).

Executive Summary

Northern Irelands health and social care (HSC) service has made improvements in

the quality of care for our population, as well as in productivity, over recent years.

There has been innovation, focused on keeping people well and independent, and

reducing reliance on hospital based care once they are unwell. These are

achievements we should be proud of, especially when taking into account the fact

that our regions HSC system spends between 7% and 16% less per head than

Englands, once our higher levels of deprivation and social need are taken into

account. (Ref: page 13).

However, there is now a clear imperative for us to make improvements in both

productivity and quality. Not only are we falling short in some areas, such as

smoking prevalence and circulatory disease mortality rates but we face increasingpressure on the system now and in the future. The pattern of need in NI, in

common with other developed countries, is changing. Growing demand for care,

inflating costs, and constraints in the growth of health and social care spend could

result in a significant shortfall in funding by 2014/15 if health and social care

continues to be provided in the same way as now.

2


3/50

EXHIBIT 1

5.4

3

4

5

6

7

2014/152010/112006/07

SOURCE: SRF; DHSSPS; various Northern Ireland historical activity sources for residual growth (see appendix for details)

Historical/ forecast spend

Forecast do nothing spendDemographic change, residual demand growth and costinflation, unmanaged, would increase spend by ~6% p.a.b per annum, nominal, total DHSSPS allocation

x Spend gap

2010/11

savings

The HSC could continue to improve quality of care and productivity to reduce this

financial gap by implementing a number of improvements:

We estimate the 2014/15 funding requirement could be reduced by ~0.1

billion by optimising the quantity and type of care provided (for instance,

through better management of long-term conditions to improve overall health

and reduce need for costly treatment)

The 2014/15 funding requirement could be further reduced by an estimated

0.5 billion by bringing down the unit cost of care provided (for instance, by

reducing length of stay in hospitals and increasing staff productivity across all

settings), subject to acceptance of all the changes needed to secure such

savingsIn addition to these improvement opportunities, required future funding could be

further reduced by several hundred million if it was possible to make some

centrally-led changes to income and costs, for instance by introducing user co-

payment for services, or centrally controlling staff pay inflation. However, these

ideas could only be progressed if there were to be significant change from current

policy and principles.

Capturing these opportunities will involve a transformational, structural change:

we need to go further than simply improving our current model to meet the scale

3


4/50

of challenge we face. We will need to create a health and social care system that

looks and feels very different from today:

Enhanced and more effective services in home and community settings will

improve health and well-being and require greater integration and

consolidation of primary and community health and social care, while

reducing activity in hospitals

Better quality acute care will require concentration of some services to ensure

minimum clinical critical mass and maximum efficiency

All of this will result in a different service provision landscape, e.g., primary

care centres acting as hubs for integrated community health and social care;

fewer acute hospitals, supported by local hospitals providing local access to

urgent care services; revised ambulance and transportation services thatsupport these reconfigurations.

Implementing change on this scale will be challenging and will require strong

political, professional and managerial leadership across the system. Indeed,

without the political will to make these changes, the current HSC system is likely

to become unaffordable within the next five years. We will also need to invest in:

the capacity and capability needed to manage the transformation programme;

effective communication with and engagement of all stakeholders including

public, patients and clients; acquiring the IT and other technology required to

improve productivity; and redeploying staff. We estimate the one-off transition

cost of the necessary changes at ~0.3 billion in total between now and 2014/15

plus additional on-going investment in necessary enablers (e.g., ~0.1 billion p.a.

in IT).

4


5/50

Any required reduction in funding beyond this will involve freezing staff

pay costs and/ or rationing access to services thereby threatening the

fundamental integrity of our system.

A further reduction of several hundred million pounds in 2014/15 required

funding could be secured by introducing co-payment for some services by

the service user (e.g., bringing protocols in line with the rest of the UK).

Investment in capacity, capability, technology, facilities, and staff

redeployment including one-off transition costs of ~0.3 billion over

the years to 2014/15.

Effective communication and engagement with stakeholders includingcommunities, patients, clients, carers, their local political

representatives, partners such as GPs, staff and staff bodies.

Significant political, professional and managerial leadership. For each

month we delay, the 2014/15 saving that could be delivered reduces by

5 million.

By undertaking a stretching programme of quality and productivity

improvement, HSCNI could reduce 2014/15 required funding by ~0.6

billion. Doing so will involve a strategic, evolutionary transformation of

our system. This will not be easy, and will require:

Growth in need for care and in unit costs, if not managed, will increase

DHSSPS required funding from ~4.3 billion in 2010/11 to ~5.4 billion

in 2014/15.

Despite this, HSCNI has improved the populations well-being and the

quality of care they can access in large part by increasing productivity,

including delivering RPA. However, more needs to be done to match

English standards of well-being and care quality.

HSCNI is not resource-rich. We spend between 7% and 16% less per

head than England when deprivation is taken into account equivalent to

between 250 million and 600 million less per annum.

Key points

5


6/50

The remainder of this document sets out in more detail where we stand and what

we need to do, over the following seven sections:

1. Where we stand today: describes how well the current service is meeting the

needs and expectations of the people of Northern Ireland.

2. The trends in health and social care needs and implications for funding:

outlines the level of funding that would be required for the future if services do

not change.

3. Reshaping the system: describes the opportunities we have identified to

improve productivity and quality in the system, and the impact of these.

4. Implications for the system: what a new, higher quality and more efficient

service could look like: explains what capturing the productivity and quality

opportunities will mean for the health and social care system.

5. What it will take to secure the necessary changes: describes what needs to

be in place for us to implement the changes we need to make, including our

estimates of the transition costs involved.

6. The pace of delivery: sets out our plan to deliver the improvements we need to

make, describing our stretch ambitions, our assessment of what can realistically

be delivered in the next four years, and additional steps we could take to

further reduce growth in spend.

7. Implementation plan: outlines our current (early-stage) plans for

implementation.

6


7/50

1. WHERE WE STAND TODAY

People in Northern Ireland deserve and increasingly expect a health and social

care service that provides high quality, cost-effective care, on a par with the other

regions of the United Kingdom. They also have reason to expect an effective,

joined-up service (e.g., for long-term conditions or for frail, older people) given

that in Northern Ireland our hospital- and community-based health and social care

are integrated (and have been, under various organisational constructs, for a long

time).

The current system has made strides towards meeting our populations needs and

expectations. It has done this while spending less than England per need-

weighted head of population, by driving up productivity alongside quality. But

more remains to be done to match the higher standards of health, well-being andcare quality accessible by people in England and to optimise how and where we

spend available funding.

Quality and productivity improvement delivered to date

Recent improvements in the quality of care delivered, detailed in Exhibits 2 and

3, include:

Overall health outcomes in a number of areas have improved. Life

expectancy, although still lower than in England, has increased for both malesand females. Contributors to this increase include reductions in mortality

rates from many conditions including cancer and reducing infant mortality

rates.

We are reducing disadvantage in our society. The gap in mortality rates

between Northern Ireland as a whole and the regions deprived areas is

reducing.

We are doing more to maximise peoples health and well-being. More

mothers are breastfeeding, more children are being immunised, more people

are being screened for disease, more smokers are trying to quit and there are

fewer births to mothers under 17 years old.

Rates of healthcare acquired infections are falling. Incidence of MRSA, C-

Difficile and surgical site infections have all declined.

7


8/50

Care is increasingly effective. For example, in 2008 56% of stroke patients

received a brain scan within 24 hours, which was higher than Wales (54%)

although lower than England and Scotland (both 59%)2.

People who use our services are increasingly satisfied by their experience,

as demonstrated by improvements in patient/ client survey results.

EXHIBIT 2

Quality of care in Northern Ireland has improved in recent years (1/2)CAGR (average annual % change)

Years (signs of good quality): a, b: 1991-93 to 2005-07; c: 2004 to 2008; d: 2008/09 to 2009/10; e: 2000 to 2009

Years (signs of poor quality): (i), (ii) 1997-01 to 2004-08; (iii) 2001 to 2008; (iv) 2003 to 2009; (v) 2006 to 2009; (vi) 2004 to 2008

* Average of Dip3, Tet3, Pert3, Pol (IPV)3, Hib3

SOURCE: DHSSPS; PHA; Communicable Disease Surveillance Centre Northern Ireland

b. Life expectancy

at birth, females0.2%

a. Life expectancy

at birth, males0.3%

ii. Cancer mortality rate -1.4%

i. Infant mortality rate -1.3%

e. Immunisation uptake

3.0%

d. Number of smokers

setting a quit date9.0%

c. % breastfeeding at

discharge from hospital

0.3%

vi. Surgical site infection

rate, orthopaedics

-17.8%

v. C-Difficile reports,

inpatients >65 years old-19.4%

iv. MRSA episodes -8.8%

Signs of good quality are increasing . . . . . . and signs of poor quality are reducing

Out-comes

Preven-tion

Safetyin care

Iii. Rate of births to mothers

under


9/50

EXHIBIT 3

Quality of care in Northern Ireland has improved in recent years (2/2)CAGR (average annual % change)

Years (signs of good quality): f, g, h: 2004/05 to 2008/09

Years (signs of poor quality): (vi), (vii) 2 007 (quarters 2-4) to 2010 (quarters 1-2); (viii) 2008 to 2010 (quarters 1-2); (ix), (x) 1997-01 to 2004-08

1 16 tests: Audiology - pure tone audiometry, barium studies; cardiology echocardiography; cardiology - perfusion studies; colonoscopy; computerised tomography;

cystoscopy; dexa scan; flexi sigmoidoscopy; gastroscopy; magnetic resonance imaging; neurophysiology - peripheral neurophysiology; non-obstetric ultrasound; radio-

nuclide imaging; respiratory physiology - sleep studies; urodynamics - pressures and flows;

2 Standardised mortality rate for under 75 years old, deprived areas relative to NI as a whole

SOURCE: DHSSPS; PHA; QOF

Clinicaleffec-tiveness

Access

Inequal-ity

viii. % patients waiting

>13 weeks for diagnostics116.0%

vii. % patients waiting

>13 weeks for outpatient care470.0%

vi. % patients waiting

>13 weeks for inpatient care-9.0%

i. Patient and client survey TBC

h. Primary angioplasty

1.9%

g. Stroke scan 24h 1.6%

f. % thrombolysis

5.9%

x. Infant in deprived area

more likely to die-2.1%

ix. Person in deprived area

more likely to die2-0.3%

Userexperi-ence

Signs of good quality are increasing . . . . . . and signs of poor quality are reducing

While delivering these improvements in quality, the system has also improved

productivity, as illustrated in Exhibit 4.

9


10/50

EXHIBIT 4

Many aspects of Northern Irelands productivity have also increasedCAGR (average annual % change)

Years (signs of productivity): 1, 2. 2003/04 to 2008/09; 3. 2008/09 to 2010/11

Years (signs of inefficiency): 4. 2003/04 to 2008/09; 5. 2004/05 to 2009/10

1 Relative to expected

2 % of complex discharges delayed by more than 48 hours

SOURCE: DHSSPS; PHA; TOR

Inpatient

3. Day of surgery

admissions %11.0%

2. Throughput per bed 4.0%

1. % all admissions done

as day case1.0% 4. Average length of stay -4.5%

Primarycare

5. Growth in primary careprescribing spend1

-3.0%

Signs of productivity are increasing . . . . . . and signs of inefficiency are reducing

Achieving these quality and productivity improvements has involved a number of

innovations in service provision. For instance,

Innovative models of telemedicine have been established in pilots and roll-

out is beginning for patients with long term conditions such as lung disease

and diabetes. This approach has avoided the need for inpatient treatment,

reduced length of stay for unavoidable inpatient spells and received very

positive feedback from patients.

Community rehabilitation teams have been established and havesuccessfully prevented admissions to hospital and to nursing care, reducing

patients length of stay in hospital and helping them maintain their

independence and well-being.

GP Out of Hours services: The introduction of nurse triage of patient calls,

cross cover of periods of high demand with staff in A&E departments,

installation of GPS and toughbooks (networked laptops) in on-call cars, have

significantly reduced the number of GPs on call in the early hours.

10


11/50

The Virtual Ward model of providing care in the home rather than in

hospital has been set up. This avoids patients needing to go to hospital,

reduces length of stay and results in a very positive user experience.

An enhanced intermediate care service has reduced bed blockages (beds

being taken up by people waiting to be discharged) and reduced average

length of stay (ALOS).

A new Pharmaceutical Clinical Effectiveness programme has reduced

growth in primary care drug spend by engaging primary, secondary and

tertiary care clinical experts in the development of prescribing guidelines.

Diabetes Inpatient Specialist Nurses have been introduced and has resulted

in a reduction in admissions and ALOS, and improved quality of care and

clinical effectiveness.

Emergency ambulance response: The training and equipping of local

citizens as first contact responders has released ambulance capacity

contributing to a significant improvement in emergency ambulance response

times across the area.

There have been many other examples of innovation, e.g., Productive Ward,

Hospital at Home, Supporting People, carer support, Local Area Co-ordination,

specialty networks (e.g., intensive care, cancer), specialist community care teams

(e.g., respiratory).

11


12/50

EXHIBIT 5

Pharmaceutical Clinical Effectiveness programcontrolled primary care drug spend

SOURCE: DHSSPSNorthern Ireland

500

50

450

400

350

300

250

200

150

100

0

+3% p.a.

+9% p.a.

2009/

10

08/

09

07/

08

06/

07

05/

06

04/

05

03/

04

02/

03

01/

02

2000/

01

Original Budget Plan1

Actual Expenses

1 Prior to Pharmaceutical Clinical Effectiveness Program started in April 2005

Expenses for primary care drugs, in m

Fiscal Year

Pharmaceutical Clinical

Effectiveness Program

Effort started in April 2005 Strategic principles are

Rationality Safety Individuality Economy Equity Consistency Continuity

Innovation Engagement of Primary /Secondary / Tertiary Care

clinical experts in developing

guidelines on prescribing

NI CASE STUDY

In addition to operational productivity improvements, DHSSPS has reduced

management overhead staff as part of the Review of Public Administration (RPA).

Savings to the end of 2010/11 will amount to a reduction in spend of ~48 million

relative to the 2007/08 management overhead baseline. Senior executives in

HSCNI have reduced from 188 to 79. The system-wide administrative staff body

has reduced by ~1,500. Commissioning Boards have merged from 4 into 1,

provider Trusts from 19 to 6 and the establishment of a shared Business Services

Organisation.

Through all of these improvements in quality and productivity, HSCNI has

continued to fulfil its other responsibilities such as research and the education anddevelopment of high-quality professionals.

The funding context within which this improvement has been

delivered

Until 2009/10, Northern Irelands spend per capita on health and social care was in

line with, or above, UK average and higher than England. From 2008/09 to

12


13/50

2009/10, it grew at a slower rate than other regions and now stands at 1,881 per

head for health care (below England, Wales and Scotland), and 519 per head for

social care (54 more per head than in England, but below the UK average and

105 lower than in Scotland).

EXHIBIT 6

In 2009/10, Northern Irelands per capita spend on health care

has dropped below that of other regions

SOURCE: HM Treasury Public Expenditure Statistical Analyses 2010

Healthcare

Social services

Northern Ireland

Wale

1.76Scotlan

1.68Northern

1.66UK

1.63

North East England 1.79

1.89

Englan

0.46

0.46

0.64

0.54

0.44

n/

a

2007/08

1.78

1.86

1.86

1.97

1.75

1.95

0.48

0.47

0.64

0.58

0.46

n/

a

2008/09

1.91

1.88

1.96

2.07

1.90

2.08

0.49

0.52

0.62

0.60

0.47

n/a

2009/10

per capita, not weighted for need

However, levels of deprivation and need for health and social care are higher in

Northern Ireland than in England. For example, 1 in 10 people in Northern Ireland

is in receipt of a disability living allowance, compared with 1 in 20 people in

England3. In his report,Independent Review of Health and Social Services Care

in Northern Ireland(Kings Fund, 2005), Professor John Appleby stated, "Thejudgement of this Review (to be confirmed or denied in the light of any subsequent

results arising from a UK-wide allocation model) is that a reasonable need

differential between England and Northern Ireland should be around 7%."

Subsequent, unpublished work by a joint DFP-DHSSPS committee estimated a

3 Another illustration of Northern Irelands relative deprivation is that life expectancy in Northern Ireland is

shorter than in England, by ~1.5 years for males, ~0.5 years for females

13


14/50

need differential of 14-17% for all care4. Analysis done in this document uses a

range of 7-16% overall need weighting and 16-36% social care need weighting.

When our regions higher levels of deprivation and social need are taken into

account, Northern Irelands health and social care system spends 7-16% less than

England on health and social care equivalent to between ~250 million and

~600 million in 2009/105. In particular we spend less than half of Englands per

capita spend on supporting people with mental health problems and learning

disabilities.

EXHIBIT 7

HSCNI spends less than England when need is taken into account

SOURCE: HM Treasury

NI 16%

weighted

2,069

NI 7%

weighted

2,293

NI un-

weighted

2,400

England

2,361

-12%

-3%

226m 606m

Fundinggap

per capita spend on health and social care, 2009/10

In the current economic environment we cannot expect funding to rise to close the

gap to English levels. Rather, as we plan the future of HSCNI, we need to

recognise that given we spend less per need-weighted head of population, we have

less room than other regions for simple cutbacks of non-essential services.

4 33-36% for social care specifically; 14-16% for health care specifically

5 Using the 14-17% need weighting this gap increases to ~540 million to ~670 million

14


15/50

Instead, we will need to look to fundamental reforms to ensure we deliver value

for money without harming the existing quality of care: a crash diet of

emergency cost cuts will not be enough to create a service fit for the long-term

future.

Further improvement required to match other regions

quality standards and to optimize productivity

As described in the preceding sections, HSCNI has improved quality in a context

of lower funding than England, by driving up productivity. However, there are

challenges in replicating the pockets of innovation and good practice across the

whole system and there are still critical areas where our service falls short of the

quality we should be delivering. For example,

Outcomes. Life expectancy is lower than England. Mortality rates from

circulatory disease are higher than in England, as is the prevalence of

coronary heart disease in our population.

Inequality. Deprivation is high both within NI (e.g., life expectancy varies

by several years between the most and least deprived quintiles of society) as

well as in comparison to England (e.g., more people on Disability Living

Allowances).

Prevention. Some health behaviour indicators are poor, e.g., the number ofsmokers and obese adults in our population is higher than in England and

Wales.

15


16/50

EXHIBIT 8

NI mortality rates are higher than comparators, except for cancer

Scotland Unknown

Wales 614.7

North East SHA 660.0

England 581.9

Northern Ireland 837.6

Unknown

Unknown

201.8

183.7

265.5

206.8

190.9

203.9

173.9

179.2

SOURCE: Northern Ireland Neighbourhood Information Service, NASCIS 2008/09, Northern Ireland Cancer Registry, Information Service Division

Scotland (ISD), StasWales, Welsh Cancer Intelligence and Surveillance Unit

Age standardised death

rate 2003 -07

# per 100,000 population

All circulatory diseasemortality age

standardised, 2004- 08

# per 100,000 population

Cancer mortality European

age standardised, 2004 -08# per 100,000 population

16


17/50

EXHIBIT 9

Smoking and poor diet could be among the causes of NIs lower lifeexpectancy and higher mortality rates

Scotland 25

Wales 21

England 22

Northern Ireland 24

25.6

21.0

22.0

24.0

21

29

27

Unknown

SOURCE: Northern Ireland Neighbourhood Information Service, Information Service Division Scotland (ISD), StasWales ,Cancer Research UK, Public

Health Observatory for Wales, International comparisons of Obesity 2008

1 Data for Scotland is 2004 (the latest), Obese is defined as BMI>30Kg/m2

Smoking prevalence(2008)%

Adult obesity, 16+,(2007)1

%

Adults eatingrecommended 5 fruitor veg a day (2006)%

Clinical effectiveness: The 'bar' for clinical effectiveness is constantly being

raised and sometimes at a rate quicker than is being implemented in NI. For

example, clinical evidence now points towards ensuring brain scans for all

stroke patients within 3 hours - and the English NHS is rapidly moving

towards doing that.

Access. Waiting times for diagnostics and outpatient care have increased.

This is a natural and difficult consequence of attempting to reduce spend

without reshaping the system and, without action, waiting times are likely toworsen as will be discussed further later in this document.

There are considerable variations in productivity in our system. We intend to

particularly target hospital care and community prescribing for reform as these

areas, even on a needs-weighted basis, have greater spend than both England and

the North East Strategic Health Authority (a comparable region in terms of social

deprivation). We have identified an opportunity to reduce performance variation

17


18/50

across the five Northern Ireland HSC Trusts, by bringing Trusts with poorer

performance into line with the better performers, e.g., on hospital admission rates.

EXHIBIT 10

Comparison of per capita spend across UK spend on services (including supplies), 2008/09

SOURCE: HSCNI; Information Service Division Scotland; Wales StatsWales; England Laing and Buisson 2008/09

264246

227 157

227

969905

835 1,078

1,090

Wales

2,254

464

472

England

2,051

417

399

Northern

Ireland

(7%

weighting)

2,066

Northern

Ireland

(16%

weighting)

399

516

1,901

363

Northern

Ireland

2,206

421

552476

Spend per capita across types of care

per capita

12%7% 10%

44%51% 48%

Wales

6,759

21%

Northern

Ireland

3,946

19%

25% 21%

England

95,311

20%

22%

100% =

Breakdown of Spend

% of total spend (total spend, m)

Primary care

Social care

Community

Hospital

18


19/50

EXHIBIT 11

High-level benchmarking suggests the largest productivityopportunities lie in hospital spend and community prescribing . . .

Hospital spend by category

SOURCE: Laing & Buisson 2008/09, NHS Information Centre Prescribing Data, HES2008/09, HSCNI data

% reduction opportunity from

NI 16% weighting to England

%

42

154

86

258

110

39

142

79

238

101

30

10464

211

75 65

Non-elective inpatientElective inpatient A&EOutpatientDaycases

208

116

3675

-18%(30m)

-12%(61m)

-7%(6m)

-18%(53m)-26%

(54m)

per need-weighted population

Northern Ireland (16% weighting)

Northern Ireland (7% weighting)

North East SHA

England

33

85

30

7956

189

64

197

Mental health Learning

disabilities

Mental health and learningdisabilities spend

54

205

50

189

64

125

145

Hospital

Prescribing

N/A

Community

Prescribing

-23%(91m)

Prescribing cost

35

116

32

107

48

140

50

126

DentalGP

Primary care spend

EXHIBIT 12

SOURCE: Northern Ireland Neighborhood Information Service 2009; Department of Health; Social Services and Public Safety

Note: SARs information is based on the home address of the patient and will not give an accurate reflection of the over- or under-usage of hospital

facili ties within a Trust Area, as patients can attend hospitals outside their immediate home areas. The SAR is indirectly standardised and compares theratio of observed admissions in an area to those that might have been expected had the area experienced the age specific admission rates of the NI

population.

And significant variations in performance across NI highlight potentialfor internal productivity improvements2009

1041049810095

WesternSouth-

ern

South

Eastern

North-

ern

Belfast

Standardised Admissions Ratio AllAdmissions (including daycases)100 = NI

111108919995

WesternSouth-

ern

South

Eastern

North-

ern

Belfast

Standardised Admissions Ratio Emergency Admissions100 = NI

Standardised Admissions Ratio ElectiveAdmissions (excluding daycase)

100 = NI

9910689114

88

WesternSouth-

ern

South

Eastern

North-

ern

Belfast

Higher admissionsin the NorthernTrusts appear to bedriven by higherelective admissions

In the SouthernTrust the higherratio is driven byemergencyadmissions

For the WesternTrust higher ratiosfor both electiveand emergency areseen

19


20/50

We describe the opportunities to improve productivity in these areas, along with

other productivity and quality improvement initiatives, in more detail in section 3.

2. THE TRENDS IN HEALTH AND SOCIAL CARE NEED AND

IMPLICATIONS FOR FUNDING

Demand for health and social care is growing quickly in Northern Ireland, in line

with the trends elsewhere in the UK. Four separate trends will combine to place

pressure on the system in the coming years:

First, our population is both growing and ageing. There will be ~50,000 more

people in Northern Ireland in 2014 than there are today and more than half

of these will be over 65. The overall proportion of people aged over 65 will

grow from 14% today, to 17% by 2014. Our larger, older population willplace more demands on the system.

EXHIBIT 13

NIs population is ageing

SOURCE: Northern Ireland Neighbourhood Information Service

2008 2009 2010 2011 2012 2013 2014 2015

80+

60-79

40-59

20-39

0-190

120

115

110

105

125

100

Population growth by age group in Northern Ireland100 = 2008 population

Second, social, behavioural and other factors are increasing the incidence of

need. There are increasing numbers of people with chronic conditions such as

hypertension, diabetes, obesity and asthma. Family structures are changing,

meaning people are less often able to rely on family for their care. Drug and

20


21/50

alcohol use is increasing. All of this increases need for public health and

social care.

Third, health and social care technology and clinical and professional practice

have changed. While some innovations reduce activity (e.g., the shift from

open heart surgery to angioplasty), many more increase it.

New drugs, other treatments and equipment now exist that were not

previously available, such as the use of thrombolysis for treating stroke

patients.

New professional and management guidelines on what is required to

provide high quality services exist to improve care, but can result in extra

costs. An example of this has been the implementation of the European

Working Time Directive, which increased costs by reducing the hoursworked per frontline member of staff. It is sometimes the case that

implementing new guidelines from the National Institute for Health and

Clinical Excellence (NICE) involves additional cost, at least at the

beginning. Another example is the greater scrutiny of child protection,

resulting in more referrals to social services.

Professionals are becoming better at identifying need that may previously

have gone undetected. For example, long-term conditions such as

hypertension and diabetes go undiagnosed less frequently nowadays.

Autism diagnoses are made more frequently and at an earlier age. Such

change is highly beneficial for the patients and clients concerned but often

leads to additional activity to care for them.

Fourth, individuals expectations of the service they receive have risen.

People expect an ever-safer, more effective service, an ever-better experience

of it, and an even greater say in their care. For example, more people are

consulting their doctor nowadays about their health concerns, often for new

conditions such as food sensitivities.

Long-term historical activity trends demonstrate the impact of the second, thirdand fourth of these factors on demand for services, but we cannot be certain of

their precise impact in the future. However, responsible planning must take

account of these residual, non-demographic drivers of growth. Other UK and

international systems are including substantial residual growth figures in their

planning (see below exhibit) and we have calculated a similar figure for Northern

Ireland using local data.

21


22/50

EXHIBIT 14

Other regions have assumed residual activity demand growthabove demographic which has been similarly calculated for NI

0.8%

England SHA B2 0.9%0.3%

England SHA A2 1.9%

Northern

Ireland1.5%

Wales2 0.5%

Scotland 1.3%

Compound annual growth rate; 2010/11-2013/14 (England SHA A), 2007/08-2016/17 (England SHA B) or 2010/11-2014/15 (all other)

Demographicgrowth3

Unit priceinflation

1.8%1.2%

N/A

2.5%

2.2%

1.9%

Total do-nothinggrowth in spend

N/A

6.2%3.5

6.0%

5.7%

3.9%2.6

1 Resid ual growth representing increasing expect ations and demand for services, improving access to care, changes in care technology, chang es to clinical practice, changes in disease

profile and all other factors which increase demand for care, other than demographics. Details of calculation for Northern Ireland in appendix; calculat ed at 2.4% incorporating ageing factor

and excluding prescribing (which were then deducted and added respectively to give figure shown above); 2.4% comprises ~4% for acute, ~1% for social care, ~0% for community and

primary healthcare, based on 04/05 08/09 CAGRs; ~0.8% ageing factor and ~0.6% impact of prescribing volume increase are based on DHSSPSassumptions

2 Healthc are only, excludes social care

3 Ac counts for growth of whole population (0.7% CAGR for NI, source NISRA) and changes in age profile (0.8 % CAGR for NI, source DHSSPS)

NOTE: Total growth in spend CAGR for comparators is accurate; constituent CAGRs are approximate representations of the aggregation of CAGRs applied at service line and organisation

level and then compounded in each year. Differences in methodolog y mean that figures for different regions are approximat ely but not precisely comparable

SOURCE: Expert interviews; DHSSPS; Welsh and English SHA QIPP plans

1 + 1 + 1 + -1

Residualgrowth1

1.8%

2.7%0.8%

1.8%

2.2%

1.3%0.9%

Low case

Base case

High case

We expect growth in demand for health and social care activity to drive costs up

by ~3.7% p.a., of which ~1.5% p.a. will be caused by demographic factors

(population growing and ageing) and ~2.2% p.a. by residual factors.

At the same time, unit costs are inflating. We expect inflation to increase overall

costs by ~1.9% p.a., as a result of rises in:

Staff pay and grade inflation protected underAgenda for Change

The cost of supplies, especially drugs caused by external market factors

Inflating cost of contracts with external service providers (primarily private

nursing homes and family health service practices such as GPs, dentists,community pharmacists, and ophthalmologists).

If we were to continue providing health and social care in the same way as we do

today, we estimate that we would need ~5.4 billion of funding by 2014/15 to

cope with this combination of growing demand for care and inflating costs.

Given that we expect funding to be below this, we are faced with a substantial

funding gap if we do nothing to change the configuration and delivery of our

services.

22


23/50

Doing nothing is clearly not an option; neither is responding by leaving services

as they are and assuming (in line with popular perceptions) that funding

shortages could be addressed by reducing senior management pay, reducing the

number of managers, or targeting managerial expenses. While such actions mayhave a symbolic value in signalling a culture of cost-consciousness, they will not

solve the funding gap. HSCNI spends ~300 million on administrative staff at

all levels, including ~140 million on managers (~7% and 3% of total annual

spend, respectively). Most of the significant management, administrative and

overhead efficiency savings potential has already been captured through RPA

and the potential for further savings is limited. Instead, fundamental change is

required where most funding is spent the services we deliver.

It is clear that we need to act now both to improve our systems productivity and

to manage down the demand on our services while driving up quality. As we

mentioned in the previous section, we believe fundamental reform will be

necessary to achieve both of these.

3. RESHAPING THE SYSTEM: OPPORTUNITIES TO

IMPROVE BOTH QUALITY AND PRODUCTIVITY

In the previous section, we described the need to improve both the quality and

productivity of our health and social care system. In this section, we set out ways

of doing this, and the potential impact.Improvements in quality and productivity can, and often do, go together. In this

review, we have considered only opportunities that have both a positive effect on

productivity and a positive or neutral effect on quality. Section 6 describes some

further, more radical opportunities to make savings, such as the introduction of

co-payment for services.

In looking for opportunities to improve, we have compared the different parts of

our health and social care system with each other, and compared our whole

system with comparators in England and elsewhere. These comparisons suggest

two main types of opportunities with a neutral or positive effect on quality:

actions that optimise the quantity/ type of care provided, and actions that reduce

the unit cost of that care. We have assessed the 14 main such opportunities,

described below, split into two groups:

Opportunities 1-6a optimise the quantity or type of care

Opportunities 6b-14 reduce unit costs

23


24/50

1. Better management of long-term conditions. We could reduce demand for

additional, sometimes costly treatment by providing more proactive, effective

and co-ordinated community-based care. This would improve quality of life

and health status, prevent complications, extend life expectancy and preventhospital admissions. This would include offering greater support for self-care

and carers.

2. Decommissioning clinically ineffective or non-essential treatments. We

could cease providing treatments that are relatively ineffective (e.g., insertion

of grommets), potentially cosmetic (e.g., aesthetic ear/ nose/ throat surgery),

treatments for which there is a more cost-effective alternative (e.g.,

hysterectomy for menorrhagia) or which have a close risk-benefit ratio (e.g.,

Cochlear implants).

3. Preventing illness. We could prevent illness in the long term by promoting

healthy lifestyles for the whole population (e.g., smoking cessation,

breastfeeding, healthy eating, healthy weight, reducing alcohol intake,

immunisation, screening, safer sexual behaviour). This would have a minimal

short-medium-term financial impact but potentially more substantial longer-

term impact.

4. Managing referrals/reducing variation in assessment. We could control

activity levels through a more managed system of practice in areas of

healthcare where a given patient is sometimes referred for more treatment, andsometimes not specifically targeting GP referrals to hospital consultants and

A&E admissions to hospital.

5. Optimising urgent care. We could reduce the number of urgent admissions to

hospital by preventing people needing urgent care in the first place (e.g., falls

prevention support for older people), and by managing them better once they

do need it (e.g., making better use of minor injuries units instead of A&E, or by

improving care in A&E). This opportunity goes beyond the improvement

potential already identified through better management of long-term conditions

(listed as 1, above).

6. Social care improvements include two main types of opportunity:

6a. We could reduce the number of clients receiving care by:

More consistentlyapplying assessment protocols that govern whether or

not a client receives social care

Allowing a few weeks intensive rehabilitation, for instance after a fall or

operation, before assessing the client for ongoing social care instead of

24


25/50

assessing them while they are still acutely unwell and therefore more likely

to appear to require more intensive ongoing care.

6b. We could reduce the unit cost of social care through:

Improved procurement of externally-provided services

Greater operational efficiency of HSCNI-provided services

Greater use of individual budgets, which incentivise the service user to

optimise the care they use by allowing them to choose and procure it, with

support

Delivering more social care in peoples own homes rather than in nursing

and residential homes.

There is also significant scope for cost reduction if we were to match Englishprotocols for user payment and/or co-payment for domiciliary care. This is

described along with other co-payment opportunities in section 6.

7. Shifting to lower cost settings. Some patients could be treated as well, if not

better, outside of hospital and at lower cost. Clinicians in NI and elsewhere

say about a quarter of outpatient appointments are for issues that could be

treated by a GP (with sufficient specialist support).

8. Productivity improvements that would reduce unit costinclude:

Reducing average length of stay (ALOS)in hospital, through more

intensive therapeutic care while in hospital, more efficient hospital

operations, and better out of hospital services to accelerate appropriate

discharge.

Increasing staff productivity by improving working processes (such as

planning and scheduling), management systems (e.g., performance

management), changing staff mindsets (e.g., adopting a culture of always

taking the patient/client perspective, by asking, What is best for

Esther?6

) and raising capabilities (e.g., in process mapping, customerservice). Specific areas we could target include

6 "Esther" is a fictional, ailing, but competent elderly woman with a chronic condition and occasional acute

needs. She was invented by a team of physicians, nurses, and other providers who joined together to

improve patient flow and coordination of care for elderly patients in Hglandet, Sweden. She, or

equivalent fictional patients/ clients, have been used to drive collaboration and improvement in several

regions. Another example is Torbay Care Trusts Mrs Smith, used to drive full integration of frontline

multi-disciplinary teams. Source: Institute for Healthcare Improvement

25


26/50

Acute staff productivity for example reducing the time surgical theatre

teams spend waiting for the patient or variability in practice between

consultants for the same condition

Community-based health and social care staff productivity for

example reducing time spent on admin by introducing better technology

and streamlining processes

GPs productivity for example, reducing the time wasted as a result of

people not attending pre-booked GP appointments or reducing the

down-time between appointments.

9. Optimising prescribing and procurement of pharmacy. We could reduce

the unit cost of drugs prescribed by increasing the use of generic drugs and

therapeutic substitutes, by controlling therapeutic creep7 and through betternegotiation during the procurement of drugs. We could also reduce the quantity

of drugs used by introducing more clinical protocols that set clear guidance on

prescribing amounts (which could also help reduce medication errors).

10. Optimising procurement of other supplies. We could reducethe cost of

supplies other than pharmacy by making our procurement approach more cost-

effective, e.g., reviewing standards for the products used, reducing waste, and

consolidating our spend on fewer product variations and a smaller number of

suppliers to get the best price.

11. Making better use of our estates. We could reduce estates costs by

minimising the amount of vacant and under-used space in our system; in the

short-term possibly leading to vacating leased space, in the longer term a

review of our estates footprint.

12. Improving management of patient flows to and from other regions. We

could introduce more cost-effective procurement of services provided outside

of Northern Ireland (e.g., eating disorder services) and better management of

two-way reimbursement for patients who cross the border (in either direction)

with the Republic of Ireland for treatment.

13. Renegotiating unit prices or re-procuring services. We could introduce

more cost-effective procurement of services provided by third parties within

Northern Ireland primarily private nursing home care and family health

services practices (GP, dentistry, community pharmacy and ophthalmology).

7 The use of more expensive drugs for conditions that could be treated by a less expensive drug

26


27/50

14. Optimising management and other administrative overhead costs. We

could review the structures and activities of HSC Trust management, the

Health and Social Care Board (HSCB) and the Public Health Authority (PHA),

to reduce any duplication and waste. (Some or all of this opportunity mayalready have been captured through RPA.)

The diagram below shows a high level assessment of the relative potential impact

of these improvement initiatives, drawing on a combination of benchmarking

analysis and a review of changes made in other parts of the UK and other health

and social care systems worldwide.

EXHIBIT 15

Improvement opportunities can be prioritised according toquality and financial impact and ease of implementation

INDICATIVE

SOURCE: Workshop 16 August 2010 (70 participants), NI interviews, experience of similar initiatives in England

High Priority

Medium Priority

Lower Priority

LTC management, early intervention1

Decommissioning2

Prevention3

Referral management, variation in assessment4

Optimise urgent care5

Productivity (staff productivity, inpatient ALOS)8

Prescribing and Procurement of Pharmacy9

Shift to lower cost settings7

Procurement of other supplies10

Estates better use of space11

Patient flows to/ from other regions12

Renegotiate unit price or reprocure services13

Reduce management costs and otheradministrative overheads

14

Quality impact Financial impact Ease of implementation

Low High Low High Low High

Social care6

If we can match the highest performing 25% of English organisations or

equivalent benchmark in each of these 14 areas of opportunity, we will improve

quality and reduce required funding in 2014/5 by ~15% (compared to the do

nothing scenario and excluding transition costs).

However, achieving these improvements will not be easy as will be discussed in

more detail later in this document:

Implementing high quality, efficient services would require and result in

major changes to the way our services are configured (see section 4): this

27


28/50

transformation of the health and social care system in Northern Ireland would

require some supporting policy and legislation changes as well as strong

political and clinical leadership to make the case for public support.

Few healthcare organisations have achieved this level of improvement across

all parts of the system simultaneously.

70% of organisational transformations, across a wide number of different

regions and industries, fail8. Typical reasons include lack of leadership will

and capacity, lack of organisational capabilities and knowledge, poor

accountability and ownership of performance by relevant staff, and

misalignment between organisation-wide aspirations and individual/team

goals and targets. Many of these statements are true of Northern Ireland right

now (see section 5); success would require substantial changes in our cultureand ways of working.

Transition costs (e.g., redeploying or reducing staff, acquiring new

technology, running duplicated services through the transition, refurbishing

buildings) could amount to ~0.3 billion in total over the 4 years 2010/11-

2013/14. (Section 5 provides a breakdown of estimated transition costs.)

It is unclear whether the identified productivity and quality improvement

opportunities will suffice to close future funding gaps. If not, then there are other

actions which can be taken to reduce required funding in future, which do not

fundamentally improve (and may worsen) quality and the systems allocative and

technical efficiency. These include: co-payment by the service user; controlling

staff wage inflation; and restricting access to services. These are discussed in

more detail in section 6 of this document.

4. IMPLICATIONS FOR THE SYSTEM: WHAT A NEW,

HIGHER QUALITY AND MORE EFFICIENT SERVICE

COULD LOOK LIKE

Our vision for health and social care in the future capturing the identifiedopportunities to improve quality and productivity will require, and result in, a

system that looks and feels very different from today.

Optimising the quantity and type of care required will depend on higher

quality services in the home and community that play a more central role in

peoples care and actively improve health and wellbeing. This will result in

8 Beer and Nohria (2000); Cameron and Quinn (1997); CSC Index; Caldewell (1994); Gross et al (1993);

Kotter and Heskett (1992); Hickings (1988); Fortune 500 interviews; Conference Board Report; press

analysis

28


29/50

reduced activity in hospitals and while introducing: greater integration of

primary and community health and social care; 12-16 hours a day, 7 days a

week access to out-of-hospital and urgent care services; multi-disciplinary

teams; and increasing scale of out-of-hospital care to ensure these standardsof service are possible.

Reducing unit costs will require a step-change in productivity across all

settings, by taking actions such as improving appointment scheduling, making

greater use of a mix of skills, adopting care protocols and reducing length of

stay in hospitals. All of these will also result in higher quality of care. In

addition, we will need to consolidate services so they operate at greater scale

particularly within the acute sector to ensure the minimum levels of activity

required for clinical quality while at the same time maintaining local access

to urgent care services.

These changes will substantially impact current services. As an example, the

diagram below shows how a network of organisations spanning major acute

hospitals through to integrated primary, community and social care centres could

effectively provide care to the population of Northern Ireland.

EXHIBIT 16

Ideally, health and social care will be delivered by a network

of organisations

1 Paediatric Ambulatory Treatment Services

Local hospital Major acute hospitalIntegrated carecentre

Comprehensiveacute services

including Level 3

ICU Neurosurgery,

(cardiology, trauma)

Range of acuteservices including

ICU Urgent medicine and

PATS1

Integrated primary,community and

social care,

possibly including

outpatients andday cases

Description

SERVICE CONFIGURATION OVERALL

ILLUSTRATIVE ANDHIGHLY PRELIMINARY

29


30/50

Over the coming months, Northern Ireland led primarily by health and social

care professionals will need to develop and implement a new model of service

configuration that includes:

Fewer acute hospital sites, reflecting the need to consolidate services for

quality and productivity reasons, as well as the impact that reducing length of

stay and acute activity will have on smaller local hospitals ability to cover

their fixed and semi-fixed costs

Development of local hospitals that provide local access to urgent care

services, complex and urgent medicine, intensive care units (ICU), and

paediatric ambulatory treatment service (PATs)

Integrated care centres that support multi-disciplinary team working across

primary, community and social care, and offer 12-16 hour, 7 day a weekurgent care services, diagnostics, assessments and access to outpatient

services

Ambulance and transportation services that support the new service

configuration

Reconfigured mental health and learning disabilities services that provide

greater care in the community, less in inpatient settings.

The scale of the change that is likely to be needed should not be underestimated.

For example, within out-of-hospital care, the system will need to move from an

individualised GP practice-based system with a high fixed cost base and low

utilisation of assets to a consolidated model which offers efficient, integrated,

and ideally co-located provision. Whichever model of out-of-hospital care that is

implemented in each region whether that be networked provision, hub and

spoke, or fully co-located services changes will be needed across all services.

30


31/50

EXHIBIT 17

Outpatient consultations delivered almost exclusivelyby consultants

Minor procedures often delivered in hospital withunnecessary admissions

Outpatient consultations delivered by a mix of consultants, GPs,nurse practitioners and other health professionals

Day care procedures with minimum time spent in network

Fully integrated teams of primary care, community care andsocial care workers easily available at least 12x7

Primary contracts based on GP performance and staff and spaceutilisation

Monitoring of community and social services activity, with tariffsbased on performance

Duplication of diagnostics due to poor communicationbetween GP and/or consultants

Indicative cost of diagnostics bundled with otherprocedures, resulting in poor equipment utilisationrates

Direct access for GPs, ideally through provision of diagnostics inenhanced primary care centres

Integration of services into one centre with electronic resultsaccessible throughout the integrated care centre (IT enabled)

Tariff based on true cost of diagnostics, requiring a highequipment utilisation rate

Series of uncoordinated visits for LTC treatmentsmanaged by the patient

Inconsistent adherence to protocols/guidelines Admissions into hospital for treatment of poorly

managed LTC conditions

Limited emergency hospital admission thanks to greaterprevention, coordinated care, adherence to guidelines and GPsrelying on easy access to expert advice

Care pathway coordinated by the patients doctors (GP andspecialists)

Single organisations consisting of primary care, community care,social care which operate efficiently and seamlessly

Primary care contracts based on per capita criteria Non-itemized community services contracts Variable access to services

Disconnected and / or unintegrated social caredelivery

Within out-of-hospital care, changes will be needed acrossall services

From To

Some current A&E activity is unnecessary, withsuboptimal care and resulting unnecessary

admissions into hospital,

Restricted primary and community care out-of-hoursaccess (requiring travel to alternative acute locations)

Duplication of services such as minor injuries units,GP out-of hours and A&E

Min. 12x7 access to local urgent care services based aroundprimary care easily accessible with the lights on and the doors

open and diagnostics on site

GPs have easy access to expert advice

Urgent care

Diagnostics

Planned care(OP, minorprocedures)

LTC and casemanagement

Primary andcommunitycare

Social care

ILLUSTRATIVE

SERVICE CONFIGURATION OUT OF HOSPITAL

Although these changes are significant, they have been advocated by professional

and managerial leaders in Northern Ireland for many years as a means to improveservices with some innovations already in train, as outlined in section 1.

Whatever final shape our service configuration may take, what is not in doubt is

that changes of this magnitude will be needed in order to meet the current

financial and quality challenges.

Reconfiguring the model of service provision to improve quality and productivity

also affects how much capacity is needed in each type of care. In some areas,

some current capacity will need to be reduced. However, in many areas, the taskis less to reduce current capacity than to avoid the introduction of unnecessary

additional capacity in future years through more productive use of existing

capacity.

In the do-nothing scenario, considerable additional capacity would need to be

added to deal with the increasing levels of demand. Much of our effort will need

to focus on changing the way services are delivered, increasing throughput and

flow of activity so that we can do more with the capacity we have.

31


32/50

EXHIBIT 18

Some savings involve removal of capacity; others making better use ofcurrent capacity to avoid adding more in coming years

0 50 100 150 200

Rengotiate/ reprocure externally-provided services

Reduce administrative overheads

Referral management

Optimise urgent care

Social care activity - later assessment for care

Social care activity - eligibility for care; type of care

Social care unit cost reduction

Shift to lower cost settings

Productivity - inpatient ALOS

Productivity - acute staff

Productivity - GP

Productivity - community-based health/ social staff

Patient flows to/from other regions

Procurement of other supplies

Prescribing and pharmacy procurement

Estates - better use of space

Prevention

Decommissioning

LTC management, early intervention

Reduce theunit cost ofrequired care(technicalefficiency)

Optimisethe caredelivered(allocativeefficiency)

Main improvement levers1

SOURCE: Various

14

13

12

11

10

9

8a

7

4

3

2

1

6a

6b

6c

5

8b

8c8d

1 Social care is one area of application of several improvement levers, but for practical reasons, all social care improvements included in social care levers (6a-c) and omitted from relevant

other levers (e.g., 13)

2 Relative to do-nothing scenario; gross of opportunities captured in 2009/10 or planned for capture in 2010/11; excludes transition costs; assumes 16% population need weighting for NI

relative to England; quartile performance; includes annual residual growth

3 Split between removal and non-addition of capacity/ cost based on activity changes except inpatients (based on change in number of required acute inpatient beds) and primary care drugs

(based on change in spend)

Reduction in 2014/15 required funding2, m

Greater productivity to removeexisting capacity

Greater productivity to avoidadding capacity

Required change to capacity/ cost3

(relative to 2008/09)

0 50 100 150 200

The overall impact on activity of the new model of care described above varies

by the different settings of care:

Less hospital capacity will be needed, e.g., ~350 fewer hospital beds and

~30% fewer hospital outpatient appointments than were required in 2008/09.

This equates to ~1,150 fewer hospital beds and ~40% fewer hospital

outpatient appointments than needed in the do nothing 2014/15 scenario.

Greater capacity will be needed in community-based services, e.g., ~20%

more general practice consultations and ~15% more community healthcarecontacts than were required in 2008/09 (5% and 1% more, respectively, than

needed in the do nothing 2014/15 scenario). The planned increases in

community-based service productivity will contribute to these increases in

capacity.

32


33/50

EXHIBIT 19

Required capacity will change - differently for each type of careRequired capacity

Acute beds

5,0481,1656,213807

5,406

Managed

2014/15

Impact of

improvement

opportunities

Do nothing

2014/15

Impact of

demographics,

residual growth

2008/09

Community

healthcare

contacts

Generalpractice

consultations

12.50.611.91.510.3

4.70.14.70.64.1

53.112.665.711.6

54.1

Staff

21% 5%

15% 0%

-2% -19%

-7% -19%

2008/09 to

managed2014/15

Do nothing

to managed2014/15

These changes to capacity will have particular implications for workforce.

Overall, our very preliminary estimates are a net reduction of ~1,000 staff

relative to 2008/09 levels a reduction that is likely to be more than adequately

covered by 2014/15 through natural attrition and retirement. However, this

headline figure masks the scale of the workforce change required. If we

continued to provide services as we do now (the do nothing scenario), we

would need an additional 10,000 or more staff by 2014/15. To avoid this, we

need to help our workforce operate in very different ways, and shift the

workforce skills mix towards delivering more care out of hospital. Fewer staff

will be needed in hospitals and residential facilities, while more staff in some

professions may be needed in the community.

Over the coming months, a substantial amount of work will be required to derive

the specific, local implications of our new vision for health and social care,

including the optimal location of capacity and the detail of our estates and

workforce strategies.

33


34/50

5. WHAT IT WILL TAKE TO TRANSFORM

Implementing the structural and other changes described above will be

challenging. To succeed, a number of enablers must be put in place: political,

professional and managerial leadership across the system; capability and capacity

to implement the changes; the right supporting infrastructure and systems; and

compelling communication of the case for change and our vision for the future.

We describe each in more detail below.

Leadership

We need to ensure:

Strong political, professional and managerial leadership across the system

Local leadership of required changes by professionals, managers, and local

political and community leaders.

Unless there is alignment across a broad group of leaders on the need to change

and the approach to take, we will not be able to implement improvements at

scale in the required timeframe.

It will therefore be vital to get together a group of leaders who will work

together to champion the reforms, pioneer and support innovation, speed up

decision making and ensure that actions across the system are coherent and

aligned. Such leaders are likely to be, at system level: Ministers, HSCB, PHA,

DHSPSS, HSC Trusts, senior health and social care professionals, Patient and

Client Council, Trade Unions, staff and professional representative bodies; and

at local level, local professional, managerial and community leaders, and MLAs.

It will also be important that leaders from all professional groups are at the heart

of designing improved models of care. They must be given a clear remit and

responsibilities to lead implementation in their organisations and communities,

and will need the training, data and managerial support to do so.

Capability and capacity

We must put in place:

Sufficient leadership capacity and capability both professional and

managerial, especially for programme management and delivery of

improvement initiatives

Mechanisms to make the most of scarce skills and resources (including

central support and ways to share learning and innovation between

organisations)

34


35/50

A workforce pipeline and talent management process that is aligned to the

strategy.

The level of capacity and capability that exists to drive change in our system

varies greatly across organisations and localities. We will need to identify and

nurture the high calibre leaders we have, and put in place programmes to

develop the implementation skills of HSC Trusts, LCGs and other professionals,

and the commissioning skills and capabilities of the HSCB/ PHA and LCGs.

We cannot afford to wait for innovation and clinical/ professional breakthroughs

to trickle slowly through the system, or to have organisations attempting to

reinvent the wheel. We therefore plan to assess opportunities via test-bed

pilots that can be rapidly rolled out to other Trusts once completed.

Finally, we must not wait until reconfiguration of services is complete beforeturning attention to workforce issues. We will need to make proactive and

immediate changes to our workforce pipeline and deployment of staff to reflect

the future delivery of services for instance by influencing graduates to apply

for roles that will be of growing importance in future, and by developing training

that reflects new roles and/or helps individuals to switch between roles.

Supporting infrastructure and systems

Implementing changes to the system on this scale will require:

A robust transformation programme architectureand an effective on-

going performance management system. We need to establish clear lines of

accountability for delivery, and incentives for individuals, teams and

organisations that are aligned to our strategy. For example, we will need to

introduce incentives for staff and partners (e.g., midwives, nurses, social care

professionals, GPs, consultants) to improve productivity across the system

not just in their own part of it.

Investment in technology to improve our ability to:

Generate useful data on performance on both quality and productivity

across NI

Support new delivery models (e.g., a single electronic health record that

would allow multi-disciplinary teams to work together seamlessly;

telemedicine equipment to allow patients/clients to monitor their

conditions at home with support from teams of professionals).

An estimated 0.3 billion transition funding over the 4 years 2010/11 to

2013/14. We have begun to estimate the costs of implementing the changes

35


36/50

described in chapters 3 and 4 (e.g., workforce transition, acquiring new

technology). The exhibit below illustrates the breakdown and phasing of

these cost estimates.

EXHIBIT 20

Total one-offtransition costs

Main transition costs could amount to severalhundred million pounds

Note: Assumes 16% population weighting for NI relative to England; includes annual residual growth1 Healthcare for London work scaled up to reflect larger footprint / population served and inclusion of social care; assuming mixture of new build, refurbishment and reuse. Note excludes

ongoing capital investments

Assumption made

Each new primary care partnership and associated integrated carecentre would require ~2.5m refurbishment1

No net reduction in total workforce above natural attrition Acute staff impacted by shift of activity into home/ community

must be either made redundant (and replaced by community-

based staff) at a cost of average 08/09 wage of 44k and one

month payment for each of 15.64 years of service, split 60:30 over

years 1 and 2 or retrained at similar cost

Unit productivity savings and switches to care have half a year lagin achievement due to time to shift staff/ activity and/or close

wards/ sites

Telemedicine; hardware (e.g., laptops); etc (One-off) introduction of new IT systems Very rough estimate of ~0.5% of total spend in 2011/12-2012/13

and half that in 2010/11

Increased need for effective communications teams both internallyand externally

Estimated based on experience at 2% of yearly savingsopportunity; front-loaded to recognise time to implement and

capture savings

2012/13

30

30

20

2

10

92

2014/15

0

0

0

1

2013/14

15

0

2

5

22

2010/11

5

10

1

1

17

45

2011/12

65

5

20

2

10

147~280min total

ILLUSTRATIVE ONLY FURTHER

WORK NEEDED TO CALCULATE

TRANSITION COSTS

CapitalInvestment

Workforcetransition

DoubleRunning

Acquisition ofnew technology

Communica-tions

Project mgt andexternalsupport

m, rounded to nearest 5m

Communication and engagement

We need to communicate the case for change and the vision for future services

effectively, and involve stakeholders in making change happen. We will need to

begin this process soon, to engage communities, patients, clients9, professionals

and all staff in shaping and supporting system-wide changes such as individual

budgets and home-based care before implementation, as well as effectively

engaging opinion formers (e.g., the press, unions) in the rationale and direction ofchange. We will also need to establish a robust clinical and professional rationale

for changes very clearly early on, if we are to successfully engage health and

social care professionals themselves in driving the changes.

Finally, we must think carefully about who tells this change story to partners,

staff, managers and local professional leaders across the system, and how.

Without a coherent narrative to explain why and how the system needs to change,

9 Fulfilling, but not limited to just fulfilling, our legal Personal and Public Involvement (PPI) responsibilities

36


37/50

staff and partners will find it difficult to remain focused on providing consistently

high quality, efficient service delivery, or to plan effectively during the changes.

The absence of any one of these enablers will reduce our ability to deliver the

identified improvement opportunities thereby increasing the funding the system

will require.

Any delay in putting these enablers in place, or any decisions which do not

acknowledge or permit strategic change, will reduce our ability to generate the

savings we believe are possible. We estimate that for each month of delay, the

feasible reduction in 2014/15 required funding will reduce by at least ~5 million.

(See below exhibits)

EXHIBIT 21

Enablers will take some time to put fully in place Of particular concernin Northern Ireland

SOURCE: HSCB Director interviews

Broader enabler Likely to be led by

Access to required transition funding including capex DFP3

Months required toput fully in place

NI-wide best practice care protocols HSCNI, Professional orgs18

Technology-enabled:

Performance information (NI-wide, consistent for quality and productivity)

Productivity (e.g., referral management, distance medicine, self-care)

HSCNI, DFP

24

24

Effective on-going performance management system with incentives for

individuals, teams and organisations aligned to strategy

HSCNI18

Robust transformation programme architecture with clear, single point

accountabilities for each programme area; sufficient capacity and capability;

good information

HSCNI6-12

Effective communication of required changes HSCNI, DHSSPS2

Workforce pipeline aligned to strategy DHSSPS, Edu orgs12-24

Sufficient leadership and managerial capacity and capability (includingcentral support, learning from other organisations)

HSCNI, DFP12

Effective local professional, managerial and political leadership of required

changes

HSCNI, DHSSPS3-6

HSCNI, DHSSPS6-9Effective senior professional, managerial and political (Minister and broader

political body) leadership of required changes

37


38/50

EXHIBIT 22

If implementation begins nowIf implementation is prevented frombeginning by 6 months

~5m permonth of

delay2

SOURCE: Various, see previous analyses

1 Relative to do-nothing scenario; net of opportunities captured in 2009/10 or planned for capture in 2010/11 all of which are assumed to be not dependent on legal

process; excludes transition costs; assumes 16% population need weighting for NI relative to England; quartile performance; includes annual residual growth

2 For first 6 months; per-month cost of delay will be greater for delays more than 6 months

Reduction in required funding1, billion

0.4

0.2

0

2014/15

0.59

2011/12

0.6

Decisions which do not permit strategic change will reducethe improvement that can be delivered within 4 years

0.6

0.4

0.2

0

2014/152011/12

0.56

We will need to work with other departments and stakeholders to enable the

changes we need to make. Specifically, we believe we must:

Work to secure political support from Ministers and MLAs.

Work with professional bodies and senior professionals to engage local

professionals in owning and implementing the required changes, across the

HSC Trusts and family health services such as General Practice

Begin to communicate with staff and staff bodies about the case and vision

for change

Work with the Patient and Client Council to engage and involve community

leaders, patients and clients in the case and vision for change

Work with DFP to invest in required technology

Work with DHSSPS Workforce to develop a detailed workforce plan,

engaging all relevant stakeholders in this, through the HSC Partnership Board

38


39/50

Work with DFP to review remuneration scales of senior roles so as to access

the required talent.

Establish a programme management and transformation communication

office within HSCNI.

6. THE PACE OF DELIVERY

By increasing quality and productivity as described in the preceding sections, and

contingent on the necessary enablers being in place, we believe it is feasible for

DHSSPS to reduce its 2014/15 required funding by 0.6 billion relative to the

5.4 billion do-nothing scenario. If more than this 0.6 billion is needed, a

further ~0.1-0.3 billion could be achieved through the introduction of co-

payment and further savings through a freeze in staff pay costs. Any furthersavings will involve reducing quality by restricting access to services risking

the integrity of the health and social care system.

This is illustrated in the exhibit below:

EXHIBIT 23

0.8

0.3

0.1

0.1

0.1

0.6

1.1

0.2

0.2

Total 2014/15 impact TBC

Restrict access to services

Total 2014/15 impact

Fixed and indirect costs

Deliverable after 2014/15

Captured 2009/10 and 2010/11

Total possible productivitysavings, as at 2008/09

Reduce the unit cost of required care

TBC

Optimise the quantity and

type of care provided

TBC

0.3

Control staff cost inflation

Copayment by service user

Total deliverable by 2014/15

TBC

To address the funding gap, HSCNI will need to increase productivity, andpossibly also introduce co-payments, control pay and restrict access2014/15, billion, potential impact on funds available for services, net of associated incremental re-provisioning costs but not

of transition costs, assuming performance of best 25% of English organisations or equivalent

SOURCE: HSCNI analysis using 16% population need weighting for NI relative to England, and including annual residual growth

Produc-tivity andqualityincreases

Other qualityneutral

Other qualityreducing

Range

39


40/50

Savings achievable through quality and productivity improvement

The 0.6 billion reduction in required funding is estimated as follows:

Evidence from three different assessments both local and international -suggests ~3% improvement p.a. would be a stretching but feasible pace of

change for HSCNI:

1. About half of the total quality and productivity improvement opportunity

will be subject to legal process. This will delay implementation and the

capture of savings by 6-36 months, depending on the specific opportunity,

and the point at which related savings can begin to ramp up (see below

exhibit). Taking this into account, a reduction in required funding

reshaping the system: implications for northern ireland’s health and social care services of...

Documents