Paying for Quality in the UK:
New Models
Peter C. Smith
Centre for Health Economics,
University of York, UK
Four elements of the
principal/agent problem
– Objectives
• How close are those of principal and agent?
– Information
• How public, how verifiable, how costly?
– Incentives
• Designed vs accidental
• Numerous design issues
– Managerial capacity
• Designing
• Auditing
• Evaluating
Incentives: some design issues
• which measures of performance to use as a basis for
rewards;
• how targets are to be set;
• over what time period the scheme is to operate;
• how performance measures along several dimensions are
to be combined;
• how much reward is to be dependent on attainment;
• what is the link between improved performance and
reward
• what risk sharing arrangements are used
• audit arrangements
• evaluation arrangements.
Incentives: what are the rewards?
•
•
•
•
•
•
•
Financial (individual)
Financial (organizational)
Professional advancement
An easy time
Freedom of action
Prestige and perceived worth
Intrinsic satisfaction
General practice in England
• All citizens must be registered with a general
practitioner
• Typical practice population 5,500 (but increasing)
• Average three practitioners per practice
• Traditional gatekeeping role in NHS
• 2/3 general practitioners are independent
contractors with the NHS
• Traditional ‘General Medical Services’ contract
developed piecemeal over decades - a mixture of
capitation, salary, fee for service and grants
• GPs are used to working in an incentivized
environment
• New GMS contract now in force.
The New GMS contract
• Developed in negotiation between government
and providers
• Approved by 79.4% in a ballot of GPs, with a
response rate of 70%
• Major emphasis on clinical quality
• Up to 30% of income determined by quality
incentives
• Major reliance on self-reporting (with external
audit).
http://www.nhsconfed.org/gmscontract/
Quality and Outcomes Framework
• Each practice can earn ‘quality points’ according
to reported performance
• 146 performance indicators
• 1,050 points distributed across indicators
according to perceived importance
• Points based on absolute level of attainment (not
adjusted for local difficulty)
• About £75 per point for an average practice, but
increasing if a difficult environment
• Minimum income guarantee (no loss of earnings)
GMS Contract:
Indicators and points at risk
Area of practice
Clinical
Organizational
Additional services
Patient experience
Holistic care (balanced clinical care)
Quality payments (balanced quality)
Access bonus
Maximum
PIs Points
76
550
56
10
4
184
36
100
-
100
30
50
146
1050
GMS Contract: Clinical indicators
Domain
CHD including LVD etc
PIs Points
15
121
Stroke or transient ischaemic attack
Cancer
Hypothyroidism
10
2
2
31
12
8
Diabetes
Hypertension
Mental health
Asthma
18
5
5
7
99
105
41
72
COPD
Epilepsy
Clinical maximum
8
4
76
45
16
550
Hypertension:
indicators, scale and points at risk
Records
Min
Max Points
BP 1. The practice can produce a register of patients
with established hypertension
9
Diagnosis and initial management
BP 2.The percentage of patients with hypertension
whose notes record smoking status at least once
25
90
10
BP 3.The % of patients with hypertension who smoke,
whose notes contain a record that smoking cessation
advice has been offered at least once
25
90
10
BP 4.The % of patients with hypertension in which
there is a record of the blood pressure in the past 9
months
25
90
20
BP 5. The % of patients with hypertension in whom
the last blood pressure (in last 9 months) is 150/90 or
less
25
70
56
Ongoing Management
The patient experience domain
• Routine appointments must be not less than 10
minutes (30 points);
• An ‘approved’ patient survey is undertaken each
year (40 points);
• The practice has ‘reflected on the results and
proposed changes if appropriate’ (15 points);
• The practice has discussed the results as a team
with patient representatives, with ‘some evidence
that [appropriate] changes have been enacted’ (15
points).
Some arithmetic
• For an average practice:
– 5,500 patients;
– 3 practitioners;
– average levels of disadvantage.
• £75 per point
• So practice income at risk = £75 x 1,050 =
£78,750
• Per practitioner = £78,750/3 = £26,250 ($50,000)
• Approximately one third of base income.
• An intention to rise to £120 per point (a further
60%).
GMS contract: the strengths
• Rewarding what matters
– structure, process and outcome
•
•
•
•
•
•
•
Balanced scorecard
Local freedom to decide on priorities
Real rewards
Consistent with national clinical guidelines
Developed by the profession
Rewards teams, not individuals
Commitment to review and update
GMS contract: the risks
• Complexity may dilute its effectiveness
• Unmeasured activity ignored
• Reward structure distortive (too easy, too hard, wrong
balance)
• Discourages practice in challenging environments (cream
skimming, recruitment of GPs in disadvantaged areas)
• Discourages collaborative actions (social care)
• Gaming (e.g. length of consultation)
• Misrepresentation (lack of effective audit)
• Ossification
• Increases managerial costs
• Undermines professional ethic, morale and unremunerated
activity (‘endogenous preferences’).
GMS contract. Why UK? Why now?
• Extra money required to maintain supply of GPs
• Decision to make finance conditional on improved
quality
• Single (or dominant) payer
• GPs with registered populations (denominator of
many of the performance indicators)
• Consensus on what constitutes ‘good’ practice
(widespread national guidelines)
• General acceptance amongst GPs of need to
improve quality
• Improving IT infrastructure (forthcoming
electronic health record)
GMS contract: the priorities?
•
•
•
•
•
Good system of audit
Urgent monitoring, evaluation and review
Addressing most grotesque anomalies
Better measures of quality and risk adjustment.
Design issues:
–
–
–
–
power and size of incentives
difficulty of targets
risk sharing
avoidance of gaming and other adverse outcomes
• Maintaining and enhancing the support of GPs