Health Service Focus

20.02.17

A collaborative approach to tackling agency

Source: NHE Jan/Feb 17

Jim Forsyth and Jane Goodall from Hertfordshire NHS Procurement explain how a cross-regional approach has allowed six trusts to tackle agency spend.

Lord Carter's review into productivity within hospitals across England unsurprisingly urged NHS trusts to collaborate across a number of different functions, in an attempt to increase transparency and reduce the variations in outcomes.

One particular area he focused on was the need to reduce agency spend across the sector, with continuing adherence to rules set out by NHS Improvement (NHSI). 

When the agency pay caps were introduced in late 2015, by the regulator’s predecessors Monitor and NHS TDA, it was decided in Hertfordshire that a collaborative county-wide strategic approach was required to tackling the challenge. 

Hertfordshire NHS Procurement, which has provided strategic, transactional and material management services to four partner trusts in the county for over a decade, agreed to look at this area. This collaboration was then extended to colleagues in Bedfordshire. 

Jane Goodall, who has held the procurement manager position, specialising in agency staff, has been a key member of the implementation team. 

“The trusts across Herts and Beds, through the workforce partnership group, basically joined together to agree to have a collaborative approach to how they deal with the new agency rules,” she said, adding that because of the experience of Hertfordshire NHS Procurement it was agreed that it was best “sat to not only support trusts in Herts but to extend our remit to cover the Bedford  and Luton & Dunstable trusts as well”. 

Open book approach 

In order to push the collaborative work forward, a memorandum of understanding (MoU) was signed by the partners, with five system-wide objectives: to comply with the NHS rate caps; eradicate the use of non-framework agencies; introduce consistent agency rates across Herts and Beds; enable consistent bank rates; and enable consistent incentives across Herts and Beds. 

“One of the underlying principles was that it was an ‘open book’ approach, and that rates were going to be shared openly. Even if trusts made a decision to do things slightly differently, they would share that intelligence so that everybody knew,” said Goodall. “This also meant that the agencies knew that the intelligence was being shared and the system was operating as one.” 

Discussing the challenges, she added that in the early stages it was just about the practicalities of forming such a collaboration. Senior leadership was seen as a necessity to the success of the scheme, and this was provided when East and North Hertfordshire Trust’s director of workforce and organisational development chaired the Steering Group. 

“We are talking about very senior members of the organisations being represented,” noted Goodall. “That is why it was important to have such a visible director to chair the steering groups. 

“After getting the early buy-in there was a feeling that the traction was going to be good. This was because we had the right people driving it forward. I also think people came on board quickly because it was very topical and they could see the benefits of working collaboratively.” 

Since the caps were introduced, and the consortium’s approach was taken forward, combined savings of more than £4.5m have been delivered across the trusts in the two counties. This has been achieved through joint tender exercises and by following the common processes set out in the MoU, which has delivered a number of benefits including consistent agency and staff bank rates across trusts, and rate cap compliance in line with NHSI requirements. 

Jim Forsyth, head of procurement at Hertfordshire NHS Procurement, said: “Not all procurement departments in the NHS are involved in agency, but we have been for a number of years through Jane. During that time, she has built up some strong relationships with colleagues in HR and the clinical community which allowed us to work with them to put a measure of discipline and control into the process. 

“Working in collaboration across the different functions has been critical to the success of this project. The open book approach helped to build trust, while the expertise and knowledge of Jane and Iain Hills at Hertfordshire NHS Procurement were essential.” 

Discussing one of the key objectives, which focused on eradicating the use of non-framework agencies, Goodall said that Herts hadn’t had a reliance on non-framework agencies, and that was about the control and rigour that already existed with those trusts. 

“It was only one trust that had a small reliance on non-framework,” she said. “But we recognised very early on to make sure there was no reliance on non-framework, otherwise the framework agencies find it very difficult to place workers because they just migrate over to that non-framework for the higher pay.” 

It was important to demonstrate to the framework agencies that we could deliver business to them, noted Forsyth. “If you have a lot of leakage to non-framework it damages the credibility of the trust. 

“It is essential that the marketplace saw that when we committed to deliver business to them we could do,  because of the consistency of the approach across the different trusts and functional areas. It also encourages them to give us the best rates they can, knowing that they are going to get rewarded.” 

The consortium, which consists of East and North Hertfordshire, West Hertfordshire Hospitals, Hertfordshire Partnership University, Hertfordshire Community, Luton and Dunstable University Hospitals Trust and Bedford Hospitals trusts, recently received a highly commended award in the ‘collaboration’ category at the Healthcare Supply Association Awards (pictured above). Also, NHSI has highlighted the organisation’s work for best practice. 

The cross-functional exercise has mostly achieved what it set out to do so far, noted Forsyth, and the main reason for this is that the trusts involved have, at each stage, agreed the objectives and approach, and have remained aligned throughout. 

“We’ve been working and talking to other trusts looking to do what we have done,” he said. “There is not one single element that makes this work – it is the coming together of the senior level commitment, and the operational teams.” 

Goodall argued that subject expertise has been essential in helping to tackle agency costs through a number of sub groups. 

“When we have tackled areas like theatres, we invited the subject experts to join the sub group,” she said. “So you have an overarching steering group that the sub groups, in areas like theatres and cardiology, report to. 

“The agency workers are part of the NHS tapestry, and have been for some time. We have acute shortages of certain categories of work and these agency workers have been around some time. The managers therefore need to have some ownership, hence the sub groups.” 

As well as seeking input from managers, Goodall noted that the consortium has “stood firm” when setting the dates for go-live with the lower rates, “and the managers have come on  board”. 

She added that this has also had a positive impact on bank and filling vacancies. 

“There is a natural link with the reduction in a pay rate to an agency worker, which not only encourages that worker to re-evaluate as to whether they join the bank, but also in terms of permanent recruitment,” Goodall told us. 

“If the gap between agency, bank and substantive rates closes, this drives a shift in the volume of workers who take up permanent posts and/or join the bank. 

“We have seen an increase in bank shift fill and a reduction in vacancies. That work is continuing. We aren’t 100% compliant yet, there are some areas that are tricky and thorny, but we have a plan that we know works.”

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