Continuing Care Update 27 th January 2010 By Christopher Spark Assistant Director of Procurement

1. Continuing Care Update27th January 2010By Christopher SparkAssistant Director of Procurement

2. Regional Strategy Phase 1 - Tactical activity conducting in depth examination of costs for our most expensive continuing care users. This activity has already delivered cash releasing savings for only 33 patients Phase 2 - Introduce business service modelling by deploying lean supply principles to drive out wastage and better manage demand Phase 3 – Commercial restructuring including market testing for all care groups, one of the primary aims is to adopt consistent commercial structures and commissioning arrangements for the region

3. Phase 1 - Original Aim • Financial pressures on PCT’s continuing to grow • Increasing demand to provide nursing and residential care more cost effectively while retaining a level of service appropriate to each individual’s need • Purchased Healthcare CMG agreed Continuing Care was a priority for procurement intervention • Following a meeting last year with re:source and representatives from a number of East Midlands PCT’s, it was agreed that OLM would review 65 patients as part of a pilot

4. Process – OLM Phase A • Intelligent costing data information service • The deliverable of this phase: • A full cost breakdown separately identifying the care, management and support and non staffing costs • A comparison of the true cost of care to the current fee levels incurred by the PCT and assess the cost effectiveness of those placements. • Report on the outcomes of the review and make recommendations as to the scope for cost and efficiency savings • Provision of the outputs from the investigations in an agreed electronic format and breakdown so that the PCT can use the data in the future

5. Process – OLM Phase B • Negotiation • The OLM service then moves onto negotiation where most value can be added. • The intention is to: • Undertake supplier negotiations for agreed identified cases which lead to new agreed prices for the provision of services • This takes into consideration the needs of individuals

6. Initial Results • £197,000 confirmed cash releasing savings for 33 patients. • Patients whom pose a risk or require further risk assessment have been identified • Certain patients have been identified whom are in residential homes or independent hospitals may be ready to step down into more independent environments such as supported living • A number of service users have been identified as needing to have their care plans reviewed as the needs have either increased or potentially decreased • There is often a duplication of use of the multidisciplinary teams. Sometimes this is provided but not actually used by the individual service user yet is included in the service charge to the PCT • ……Next tranche of cases, 294 high cost placements (annual spend of £30m) has the potential to deliver savings of £1.4m by 2010/11.

7. Key Challenges Data • Costing of care packages • Activity trends IT • No automated processes Processes • Variations in recording care delivery, activity, goals of treatment and outcomes Interaction • Patient User Groups • Local Authorities

8. Observations • Due to the lack of collaboration and high level of spot buying, this had led to inconsistencies across the region, a huge variation in rates, and has resulted in a highly driven provider market • Quality of provision varies considerably and is not proportional to the size of the organisation • There are examples of positive practice within the region • Increased PCT involvement has helped negotiations and relationship building • Venture capitalist backed providers are making up to 40% profit on individual placements

9. Next Steps - Plan “B” and Plan “A” • Plan A – Individual contributions model • Not currently legal – but pilot studies exist • Probably legal by 2013 • Long term plan to support patient choice agenda • Plan B – Approved provider list model • Legal • Good intermediate position • Anticipated implementation 2010/11

10. Plan “B” City Council Social Need Assessment £ contribution ? Suppliers PCT Clinical Need Assessment Funding Decision Yes / No Negotiation Other agencies Approved List Payment Home selection PCT User Provider Other Patients select from a list of approved suppliers

11. AWP Process • Services / Pricing model Can you provide the service shown at the stated rate? Core services“Bolt ons” Older person Older person/mental health Physical Disability Mental Health End of Life Learning Disability Brain injury Physiotherapist Psychiatrist Medication Continence ??? ??? ??? £x £x £x £x £x £x £x £y £y £y £y £y £y £y Answers will be formatted Yes / No

12. High Level – Project Plan Aug Sept Apr Aug Dec Jan 2011 Oct Nov Dec Jan 2010 Feb Mar May Jun Jul Sep Oct Nov 7. Advertise services; 8.Open AWP on BRAVO 1.Evaluate provider market Go Live 2.Set scope and participants 9.Run AWP provider forums 6.Agree actual participants 3.Sign off service specs & QMT 10. Evaluate questionnaires 4.Construct questions & framework of rates for AWP questionnaire 11. Summarise findings 12.Inform Market who successful providers are 5.Design commissioners input process / support web pages

13. Thank you for listening. Any Questions?