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05.08.15

Lord Carter’s productivity review is about culture, not toilet paper

Siva Anandaciva resize 635743650377561913Guest blog by Siva Anandaciva, head of analysis at NHS Providers, gives his thoughts on Lord Carter’s review on operational productivity in the NHS and the required ‘Next Steps’.

In June 2015, Lord Carter published his interim report on operational productivity at NHS providers. If you are short of time, flip straight to page 20 and read the two short paragraphs in the ‘Next Steps’ section. These are the most important part of the report to me, because they highlight the differences between Lord Carter’s work and other approaches to procurement and efficiency benchmarking.

What did the Lord Carter review team do differently?

“I have found two of the key obstacles [to productivity] to be lack of quality data and the absence of metrics to measure relative performance.” – Lord Carter

Firstly, Lord Carter kept his work simple and focused. That is not damning the work with faint praise – when I meet new non-executive directors of NHS providers, they often want an initial route in to more detailed conversations about the efficiency of their organisations. The adjusted treatment index (ATI) created by the Lord Carter team does this.

The ATI is not perfect. It builds on existing reference cost indices and suffers from the same data quality issues, it is purely acute-focused for the moment, it potentially under-represents the cost of complex specialised care and structural factors such as working across multiple hospital sites. I would not want my job to hang on whether my ATI was 104 or 108. But if I was on a board of a hospital, the ATI would be one of the first things I would look at to kickstart conversations internally and with other multi-site specialist trusts, for example, on how we could improve efficiency.

“There are significant efficiencies to be made but there is no magic wand to deliver them.” – Lord Carter

Secondly, Lord Carter sets a realistic timescale and a credible level of expectation for productivity improvements. Undeliverable savings over undeliverable timeframes defeat rather than inspire, and I have seen too many waterfall charts and financial bridges that assume heroic in-year savings.

The review makes clear that (i) it will take several years to realise these potential productivity gains, even with a lot of hard graft by NHS providers, and (ii) the improvements identified in the report are not the magic solution to the £22bn efficiency savings the NHS needs by 2020-21. 

“My personal thoughts are that a regulatory approach will probably fail to capture the imagination and engagement of hospital boards.” – Lord Carter

When launching the NHS Procurement Atlas of Variation to compare the prices hospitals pay for common products, [then health minister] Dan Poulter was quoted as saying “we can celebrate the savviest buyers and shame the worst offenders for all to see”. Lord Carter chose to go in a different direction with his engagement and messaging and this was the final and most important differentiating factor for me.

The Carter metrics were co-developed with a group of 22 NHS providers, and information was shared with the trusts prior to publication so they could sense-check the material as partners. We will never universalise best practice through the tyranny of the benchmarked price of toilet paper, because improvement is something you do with organisations, not to organisations.

I understand the frustration from a central policymaker’s perspective, I really do. If you want NHS providers to further improve productivity then what ‘levers’ can you pull to get them to do it? You can write improvement trajectories into contracts, or make them a condition of accessing central funding support. But as Lord Carter points out, that will utterly fail to inspire the very people on the ground who must find the headspace to deliver these improvements in the face of rising operational pressures.

There is a lingering perception in some quarters that the provider sector is an archipelago of 240 islands that seek complete autonomy and shun collaboration, which look at a benchmark and stand pat if they are on the right side of the line but question the data if they are on the wrong side.

I have seen the opposite over the last 10 years – trust boards and staff that are hungry for new information and who reach out to learn and share good practice with each other to deliver better value for patients. Lord Carter and his team reflected this in their approach. As a result their work has the potential to pay dividends for the provider sector and the public it serves.

Much more on the Carter review, including an interview with Lord Carter, in the July/August 2015 edition of National Health Executive.

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