Contracting for integrated care – what happens once the ink is dry? A few weeks ago, in our publication Commissioning and contracting for integrated care we described a number of alternative contracting models currently being implemented that encourage and allow providers to work together, within a single budget and/or to an agreed set of outcomes.
In the discussions I had producing this report and afterwards, there was a lot of interest in these contracting models among commissioners, providers and policy-makers. At a national level, theNHS five year forward view clearly describes several different provider models. New integrated provider models are being defined and rolled out, and contracting tools are seen as the vehicle to make these models happen. However, the contract is often seen as an end in itself rather than a tool for encouraging new ways of working.
In addition to signing on the dotted line, we highlight a number of factors that should be taken into consideration when building new contracting models:
The contracts we describe all shift more financial and clinical risk onto providers. Many promising models in England and abroad have failed in the past because providers have not had the foresight, skills or information to manage this risk. See our paper on accountable care organisations for more on this issue.
We have recently heard that the prime contractor for musculoskeletal services in Bedfordshire (one of the case studies in the report) has been unable to agree the terms of a sub-contract with one of its main local acute providers. This highlights my point – the contract in itself cannot make integration happen, it is just the starting point for establishing a new way of working, one that removes some of the pre-existing financial and organisational barriers.
At the moment, it seems that commissioners and providers are focusing on the structures of contracts rather than on how they will actually work in practice. The contract should remove some of the traditional barriers to integration and establish a clear set of outcome measures, but it will not in itself provide a blueprint for how providers work together to make decisions and deliver care for patients on a daily basis.
Providers within new contractual models must establish an appropriate governance structure. Through this they can work together to develop and agree delivery models and pathways that will meet the outcomes stipulated in the contract.
New contractual models are inherently risky, particularly as providers take on large budgets and shift money around the system. They are largely untested, despite the promises of cost savings and quality improvement. In more complex partnerships that involve financial risk and complex flows of money, providers will need to keep their eyes open, giving careful consideration to how this risk is managed in order to protect the interests of all partners.
The commissioners and providers involved in developing these new contractual solutions feel like the whole world is watching – waiting to see some flicker of success before following suit, or waiting for failure so they can say ‘I told you so’.
The conditions are as good as they have ever been for these new models to flourish. The national context is much more permissive and flexible – allowing for longer-term contracts and more flexible payment models. Commissioners have a number of different template models available, and support from a range of different sources. Once the ink is dry, the main thing standing in the way of providers working together in a meaningful way is their own capacity and willingness to do so. The King's Fund
In the discussions I had producing this report and afterwards, there was a lot of interest in these contracting models among commissioners, providers and policy-makers. At a national level, theNHS five year forward view clearly describes several different provider models. New integrated provider models are being defined and rolled out, and contracting tools are seen as the vehicle to make these models happen. However, the contract is often seen as an end in itself rather than a tool for encouraging new ways of working.
In addition to signing on the dotted line, we highlight a number of factors that should be taken into consideration when building new contracting models:
- collaboration and engagement across the local health system
- establishing appropriate outcome measures
- reducing fragmentation across different payment streams
- focusing on building trust and relationships.
The contracts we describe all shift more financial and clinical risk onto providers. Many promising models in England and abroad have failed in the past because providers have not had the foresight, skills or information to manage this risk. See our paper on accountable care organisations for more on this issue.
We have recently heard that the prime contractor for musculoskeletal services in Bedfordshire (one of the case studies in the report) has been unable to agree the terms of a sub-contract with one of its main local acute providers. This highlights my point – the contract in itself cannot make integration happen, it is just the starting point for establishing a new way of working, one that removes some of the pre-existing financial and organisational barriers.
At the moment, it seems that commissioners and providers are focusing on the structures of contracts rather than on how they will actually work in practice. The contract should remove some of the traditional barriers to integration and establish a clear set of outcome measures, but it will not in itself provide a blueprint for how providers work together to make decisions and deliver care for patients on a daily basis.
Providers within new contractual models must establish an appropriate governance structure. Through this they can work together to develop and agree delivery models and pathways that will meet the outcomes stipulated in the contract.
New contractual models are inherently risky, particularly as providers take on large budgets and shift money around the system. They are largely untested, despite the promises of cost savings and quality improvement. In more complex partnerships that involve financial risk and complex flows of money, providers will need to keep their eyes open, giving careful consideration to how this risk is managed in order to protect the interests of all partners.
The commissioners and providers involved in developing these new contractual solutions feel like the whole world is watching – waiting to see some flicker of success before following suit, or waiting for failure so they can say ‘I told you so’.
The conditions are as good as they have ever been for these new models to flourish. The national context is much more permissive and flexible – allowing for longer-term contracts and more flexible payment models. Commissioners have a number of different template models available, and support from a range of different sources. Once the ink is dry, the main thing standing in the way of providers working together in a meaningful way is their own capacity and willingness to do so. The King's Fund
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