1. WestawayGillis Innovators in Healthcare Solutions Development of a Business case in the NHS Mr Kim Sergeant Managing Director

2. WestawayGillis: Innovators in Healthcare Solutions Agenda Context – the NHS today –Focus on PCTs Business cases –Information needs –Good business cases –Common mistakes

3. WestawayGillis: Innovators in Healthcare Solutions Although NHS Trusts remain the main providers of secondary care…they now get their money from PCTs! Department of Health 28 SHAs 308 PCTs & CTs Local Authorities Accountability Contracts Budgets Acute Trusts & Foundation Trusts Own org money only ‘Special payments’ PCTs hold 75% of the NHS budget!

4. WestawayGillis: Innovators in Healthcare Solutions PCTs are responsible for commissioning the majority of care… PCT Board sets overall strategy Executive (PEC) develops policy GMS GPsPMS GPs & PMS Plus “Provider services” employed by PCT e.g. District Nurses, Health Visitors Mental Health Trusts NHS TrustsPrivate SectorTertiary & specialist centres PCT Consortia at different levels PrimaryMental healthSecondarySpecialised Central commissioning

5. WestawayGillis: Innovators in Healthcare Solutions From a Trust perspective things are changing too… Historically Trusts hold contracts with multiple commissioners Commissioning arrangements are often based on historical precedent and do not change frequently Some localities have block contracts, others have case-by-case arrangements Contracts may or may not include cost of drugs

6. WestawayGillis: Innovators in Healthcare Solutions Introduction of Payment by Results – HRGs & the National Tariff The new system of payment will be introduced gradually over five years HRGs and a national tariff will be put in place to enable volume-casemix commissioning This will be developed to capture as much NHS activity as possible, so radically changing PCT commissioning methods Foundation Trusts will use the National Tariff for all procedures from April 2004

7. WestawayGillis: Innovators in Healthcare Solutions Across the NHS there is an increasing need to justify new or increased investment in services or products Key questions to address include: –What is the product / service New drug / indication / technique –The problem / situation this is addressing –The benefits –Where will it be prescribed / utilised –Who will it be prescribed to / used for (specific groups of patients / entry and exit criteria) –Performance in relation to alternative therapies / techniques Efficacy Safety –Where does it fit with national / local priorities

8. WestawayGillis: Innovators in Healthcare Solutions Even if D&T Committee approval is given funding still needs to be found Funding can be found by –Using within current budget replacement / cheaper products stopping doing something else –Approach the Trust for funding –Approach PCT for in-year funding –Approach PCT for future funding

9. WestawayGillis: Innovators in Healthcare Solutions Timing is important for success: the funding process starts in September 2º care directorates look at previous spend –Budgeted figure –Outturn Within directorates each department will review –future requirements –Cost pressures –Review inflationary uplift and any savings that may be needed

10. WestawayGillis: Innovators in Healthcare Solutions There are key stakeholders involved in the process 2º Care Business / directorate manager Management accountant Chief pharmacist / directorate senior pharmacist Clinician Contract manager dealing with commissioners Director of operations 1º Care / PCT Director of Commissioning / Lead commissioner Chief pharmacist Chair of Rx committee Finance Director

11. WestawayGillis: Innovators in Healthcare Solutions Within the trust – priorities have to be established Each directorate flags up budget needs Trust management team Prioritisation process starts Trust meet with PCTs Agreement reached in funding - LDP

12. WestawayGillis: Innovators in Healthcare Solutions Money will generally follow priority areas Anything that can demonstrate a positive impact on –waiting lists –waiting times Star ratings Anything that fits in with the PCT priorities

13. WestawayGillis: Innovators in Healthcare Solutions When presenting a ‘business case’ PCTs have specific information needs Impact on other parts of the system –Primary/secondary care interface –Walk in centres –PGDs (Patient Group Directives) –Nurse/pharmacist prescribing –training Policy/target hooks/performance management –Any impact on NICE/NSFs –“This is the bit that the industry are pretty good at” Costs – in a form that matches up with requirements and reflects NHS budgeting & planning frameworks –Immediate costs –Longer term costs

14. WestawayGillis: Innovators in Healthcare Solutions If the case isn’t clear cut additional information may be requested Effect on referrals –“Likely to become more critical under new contract as GPs already feel over-burdened” Risks and assumptions in realising financial benefits –Are there external factors that might jeopardise benefit realisation Closer look at outcome data –Qalys/NNTs

15. WestawayGillis: Innovators in Healthcare Solutions There are some common mistakes that need to be avoided when making a business case Timing is everything –“If you get something at the wrong time you generally put it in the bin” Budgets and services are parochial –Be careful when trying to sell on a cost saving realised by another department / trust / budget –“Moving funding around is getting better but it is time and energy consuming” –“Projects often founder because there are dependencies or benefits elsewhere in the system” Using language that is too ‘clinical’ –Information needs to be in a format that more ‘generalist’ purchasers can understand

16. WestawayGillis: Innovators in Healthcare Solutions Good business cases are setting the standard Business cases need to be comprehensive Business cases need to be realistic Anything that enables localities to personalise information is key –“draft protocols that can be amended for local use saves us heaps of time” Independent review of evidence is persuasive