interviews

Benchmarking what good looks like

Lord Carter of Coles discusses the findings of his recent review, the work of NHS Improvement (NHSI) and the importance of benchmarking. David Stevenson reports.

“Good people, given good data, usually do good things”, according to Lord Carter of Coles. So the question, he asks, is what does good look like? 

Speaking at The Commissioning Show, co-located with Health+Care, the procurement tsar gave a brief run-through of his recent review, which suggests that acute hospitals could save up to £5bn a year by 2019-20 through efficiency measures (covered in the March/April issue of NHE).

One of his recommendations was that NHSI should develop the much talked about in the media ‘Model Hospital’ and the underlying metrics, to identify what good looks like, so that there is one source of data, benchmarks and good practice. 

He cites, for instance, that patient-level information and costing systems (PLICS) are important for consistent costing and creating common metrics, including the adjusted treatment cost (ATC) and total cost per weighted average unit (WAU). 

“Every hospital is different, everybody has different needs, we know that,” said Lord Carter. “But what you see when you unpack the data is that many things are the same. One of the great things about the NHS is that we have a lot of data; one of the problems is that we haven’t used it very well yet. But it is there.” 

He noted that his report found, as we are all now aware, “significant unwarranted variation” across all of the main resource areas. 

“The major problem of delayed discharges, everyone knows about it,” he said. “But what we’ve failed to do is anything about it. You do get the sense that it is one of those issues: it is like the famous dog watching television, everybody can see it but nobody gets it. 

“That’s the problem. Many hospitals we went into we thought it was a cost problem, but what we actually found was that it was a revenue problem.” 

Patient-level cost collection 

As NHE went to press, NHSI published its ‘Findings from the 2014-15 PLICS’ report, which found that progress had been made on this data; however, there are still quality issues and more “prescriptive standards” and a wider, mandatory PLICS collection from all providers is required. 

NHSI added that service-wide adoption of PLICS and a centralised collection and analysis of the cost data are important tools in helping to drive the efficient use of resources for patient care. It is also essential that the centralised PLICS information is shared with providers and the wider NHS in a user-friendly and efficient way, something which Lord Carter advocates, to support benchmarking of costs and service review. 

Within the report, it was noted that NHS England found an 80% difference in the cost at which some high-cost devices are sold to different hospitals, and the Carter Review made similar observations in its analysis of orthopaedic devices. 

The regulator said it will conduct a voluntary PLICS collection for 2015-16, and “this year’s voluntary collection and subsequent benchmarking, costing improvement work and other uses will benefit from the widest possible participation from providers. We therefore strongly encourage all acute providers to participate in this collection of PLICS data”. 

Alyson Brett, CEO of NHS Commercial Solutions, a provider of choice for procurement and commercial services to the NHS and wider public sector, said that there are opportunities to improve via benchmarking, and it is always a hot topic. 

“It [benchmarking] is also a key theme in the Carter Report, you can’t avoid it,” she said. “Our view is that by benchmarking with European and international partners we use it to improve, not prove a case. It is more than just a comparison about price or the length of inpatient stay. The feeling in the procurement community also is that the Carter Report is a great platform.” 

Pursuing quality and value 

Lord Carter added that one of the great themes in the NHS is: “We have some people doing wonderful work, but we have some complete idiots at the other end. In the middle we have a group who can do better. What we have failed to do consistently, over time, is take the best practice. 

“But don’t you think it is fair that as we battle for quality, we battle for value? The good news is that we know how to do it.” 

Brett noted that productivity and efficiency is a much better platform for procurement to help support the NHS in delivering savings and efficiencies. However, she does question whether the culture exists in the NHS to deliver the Carter Review and its recommendations. 

But Lord Carter says that NHSI is a “really important” development as it is trying to work out an operating model which is based firmly in the belief that people need support to deliver change. 

He added that the responsibility of implementing his review is transferring from the Department of Health (DH) to NHSI. As we reported on NHE’s website in June, Jeremy Marlow, who currently has responsibility for the Carter Review at the DH, will be joining NHSI on secondment to lead a new directorate. He will be the new executive director of Operational Productivity.

Next steps 

With the provider deficit on course to hit £550m this year, although NHSI is trying to mitigate this to £250m, Lord Carter said that NHS trusts must make sure all their resources are working as best as they can and are driving efficiencies – including plans to consolidate back-office and pathology services (more on page 8). The data implications of this work will, however, be something to consider going forward the National Data Guardian, Dame Fiona Caldicott told NHE. 

In support of the plans, Brett said that looking “at back office and shared services we, in procurement, believe that is the only sustainable way for services to be provided in the future”. 

Although Lord Carter’s work has focused on the acute sector so far, he did say that the remit will be expanded: “We’re going to move on to mental health and community providers, but at the moment it is about the £70bn spent on acute providers.”

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