1. 1 Reference Costs & Wheelchair Services

2. 2 Contents Background –Costing vs. collection –What are reference costs? –Governance –Why do we collect reference costs? Collection process 2013-14 collection information Wheelchair services –Wheelchair currencies –2013-14 wheelchair data –Future wheelchair collection

3. 3 Costing vs. collection The reference costs collection is currently the only nationally mandated cost collection for NHS services. Reference costs collections comprises of two key elements  Costing – is the method whereby providers quantify the cost of running their organisation.  Collection – is information/data national bodies gather to make decisions.

4. 4 What are reference costs? Reference costs are the unit costs to the NHS for providing defined services in a given financial year to NHS patients in England. They are collected and published annually and reconcile to annual accounts. The unit costs are calculated on a full absorption basis, each reported unit cost includes: (a)Direct costs - relating directly to the delivery of patient care, e.g. medical staffing costs; (b)Indirect costs - indirectly related to the delivery of care, but cannot always be specifically identified to individual patients, e.g. catering and linen; and (c)Overhead costs - costs of support services that contribute to the effective running of the organisation, and that cannot be easily attributed to patients, e.g. payroll services.

5. 5 Costs are submitted for each service using a defined currency. Currencies for inpatient are Healthcare resource groups (HRG) which are groupings of similar diagnoses and procedures that use similar resources. What are reference costs? ServiceCurrency Acute There are approx. 2,782 HRG’s with acute services covering inpatient, outpatients. Mental Health 21 care clusters Services not covered by care clusters are costed on a cost for a direct contact with a patient ( either face to face or non-face to face) or for inpatient services on a cost per bed day.. Ambulance Services Services offered, (calls taken, hear and treat or refer, see, treat or refer and see, treat and convey) Community Services Community contacts, costed on a cost for a direct contact with a patient ( or proxy) and can be face to face or non-face to face contacts. Community hospitals are costed on a bedday basis.

6. 6 National governance & advisory arrangements Reference Costs Advisory Group (RCAG) A Community RCAG/Working groups Mental Health RCAG/Working Groups Joint Pricing Group (JPG) (NHSE, Monitor, DH &TDA) BC Acute costing working groups

7. 7 Why do we collect reference costs? National The reference costs return is used, by NHS England and Monitor, to set the national tariff, the price paid by commissioners for NHS services Used for the TDA benchmarking tool, providers are able to benchmark their costs against each other. Accountability to parliament and the public, for example parliamentary questions & FOI’s The return is used to calculate the Reference Costs Index (RCI). This is a measure of relative cost difference between providers – more detail on this later Local The NHS use reference costs; –To report to their executive teams, –To benchmark their data against other similar providers, –For contract negotiations, and –For local price setting where there is no national price

8. 8 Collection process DateMilestone NovemberDraft reference cost guidance published to sector for comment. JanuaryFinal amendments to reference cost guidance February -Reference costs guidance published -Release of draft collection workbooks MarchRelease of reference costs grouper and documentation AprilRelease of Unify2 compliant REFC and SPELLS test workbooks May -Release of final workbooks -Discussion regarding future reference cost changes with sector (i.e. RCAG, Community RCAG etc.) JuneReference costs collection window opens July (end)Reference costs collection window closes August – September Analysis of data SeptemberRelease of draft reference cost index (RCI) on Unify2 October-Publication

9. 9 2013-14 collection information Findings from the 2013-14 data collection: the 2013-14 reference costs cover £58.3bn of NHS expenditure, an increase of £3.2bn (5.8%) from the £55.2bn collected in 2012-13, this represents 55% of £106.5bn total NHS revenue expenditure in 2013-14; around 1.5m lines of data were submitted by 244 NHS providers, and; for admitted patient care services, detailed costs were provided for 2,025 treatments and procedures covering over 16 million finished consultant episodes (FCEs). Reference Costs Overview

10. 10 Wheelchair services In 2012-13 the Department commissioned Deloitte to develop an initial non-mandatory tariff for wheel chair services. Following this, in 2013-14 needs based currencies for non-complex wheelchair services covering assessment, equipment, review and repair and maintenance were introduced. These currencies do not cover specialised complex wheelchair services commissioned by NHS England. In the current 2014-15 reference costs collection data is being collected against these currencies. Reference Costs Overview

11. 11 Wheelchair currencies There are currently 13 currencies, wheelchair services are collected against The following table shows the currencies; Reference Costs Overview

12. 12 2013-14 wheelchair data Reference Costs Overview Adult Wheelchair ServicesChildren Wheelchair Services Activity Total Cost (£) Unit Cost (£)Activity Total Cost (£) Unit Cost (£) Assessment, Low Need54,8604,765,651873,708564,818152 Assessment, Medium Need93,44918,443,57319713,0962,156,415165 Assessment, High Need, Manual16,5833,001,6871814,268942,200221 Assessment, High Need, Powered11,6733,695,8973172,268457,790202 Equipment, Low Need38,5928,295,1582153,163808,830256 Equipment, Medium Need31,28515,178,2754854,5831,766,402385 Equipment, High Need, Manual17,11011,112,6806493,7172,333,972628 Equipment, High Need, Powered9,27813,317,9921,4354,5971,733,225377 Repair And Maintenance, All Needs, Manual157,50711,629,2007419,3831,716,47289 Repair And Maintenance, All Needs, Powered22,4523,377,8211502,709555,097205 Review, All Needs27,3923,278,4371205,192943,206182 Review Substantial Accessory, All Needs11,6591,600,1041372,373302,930128 Specialised Complex Wheelchair Services78,68222,109,0612819,4132,495,285265 570,522119,805,53678,47016,776,644

13. 13 Future wheelchair collection Tariff development for wheelchair services in its infancy. As the currencies develop reference costs will be adapted, to reflect the changes made. Trusts will continue to be required to collect costs and activity for these services.