The National
Tariff
Ric Marshall
Director of Pricing
www.monitor.gov.uk
2012 Act splits price setting role between
NHS England and Monitor
NHSE leads on:
Monitor leads on:
Close working
and agreement
 Scope and
design of
currencies
 Variation rules to
National Tariff
currencies
 Pricing
methodology
 Regulated prices
 Local
modifications
 Rules for local
pricing and nontariff pricing
NHS England
Defines the Currencies
These are the units of
healthcare – using expert input
Monitor
Sets the prices
Costs set using reference
costs from providers
Formal Consultation with the Sector
Section 118 Notice
Consultation set out within the
2012 H&SC Act
Monitor’s Price Setting Role
Our price setting role has potential to bring significant benefits to patients
Tariff setting not just a method for allocating funds:
 Signalling financial implications of decisions can influence behaviours
of commissioners and providers…
 …and, in turn, improve quality of outcomes for patients at the
same or lower cost
2014/15 National Tariff
Not all prices use a National set price….
• Local determined prices are:
– Local modifications – increases in national prices for services that
are uneconomic for structural reasons, which must be approved by
Monitor
– Local variations – adjustments to national prices or currencies that
are agreed by providers and commissioners, and must be published
– Local prices – locally negotiated prices for services that do not
have national prices, including some services with national
currencies
• Must adhere to the rules set out in the 2014/15 National Tariff
• Prices for ambulance services contracted by commissioning
organisations will follow these rules
Patient Level Costing
Costing
Review
• Monitor has commissioned a review of patient level
costing in a range of settings
• For Publication Summer 2014
Costing
Road Map
• The Roadmap sets out Monitors vision of the future
of costing policy
• For Publication Summer 2014
• Seeking engagement from providers on the
Roadmap
Engagement
• Ongoing engagement on improving costing policy
Period
Reviewing Urgent and Emergency Care
• Monitor is currently reviewing models of payment for urgent and
emergency care
• Early Findings:
– High levels of fixed and semi-fixed costs regardless of demand because of
required capacity – reducing demand doesn’t reduce costs
– Variety of cost structures across the components of urgent and emergency
care
• Emerging Themes for Reform
– Better coordination across providers to improve outcomes
– Earlier intervention to reduce demand for emergency care
– Recognition of the need to maintain a level of coverage and the fixed costs
associated
– Local discretion to design models that are responsive to the needs of local
populations
– Improving quality of data
The Pricing Timeline
Policy
Forward
Look
Case
management
Costing
Tariff
development
Payment
system
Early 2014
Costing
Guidance for
2014
Spring 2014
Draft longterm strategy
for payment
design
Summer 2014
Final longterm strategy
2015/16
National Tariff
Methodology
Discussion
paper
Tariff
Engagement
Documents
Publication of
2012/13
PLICS pilot
Costing
Direction of
Travel
Start of
pricing case
management
and local
determined
prices
Autumn 2014
National
Tariff
Document
Statutory
Consultation
National
Tariff
Document
for 2015/16