Payment by Results

Payment by Results - PCT's will:

Aims and Objectives of the Reforms:

Move from an NHS which is a monopoly provider of health services, accountable to the DH
To a greater diversity and plurality of services, more responsive to patients, managed according to transparent, common standards that are inspected and regulated by an independent body that reports nationally and locally

The Jargon:

HRGs - Healthcare Resource Groups. Groups of treatments that are similar clinically and consume similar amounts of healthcare resources
RVUs - Relative Value Units. A system that weights the relative difference in cost between different HRGs.
Weighted Activity - Measure of activity level adjusted for complexity of casemix, by applying the relevant RVU

Objectives of the New Financial System.

A transparent, rules-based system for PCTs to pay providers that:

Rewards efficiency
Supports patient choice and diversity
Encourages patient activity by giving incentives to providers to improve capacity to ensure sustainable waiting time reductions

National Tariff:

A standardised tariff will apply to all providers of service to the NHS
Based upon national average Reference Costs adjusted to take account of increases in pay, price inflation, changes in practice (including NICE guidance) and impact of one off costs

Effects upon Providers and Commissioners.

Providers:

Earn extra resources on a cost per case basis for treating additional patients
Lose resources on a cost per case basis for failing to deliver the volumes commissioned

Commissioners:

Expected to commission further activity from alternative providers where agreed targets are not met

Key Elements: