The Pre-Budget Report put some numbers on the scale of efficiency savings that the NHS will be expected to find over the next few years. Another reason for the NHS to get a grip on its data, says Daloni Carlisle.
The Pre-Budget Report in December 2009 threw a number of challenges to the NHS in general and to its chief executives, directors of finance and IT managers in particular.
Squirreled away beneath the hoo-ha over whether the National Programme for IT in the NHS was to be axed or trimmed by £600m or £500m, the PBR called for interim savings of £10 billion a year by 2012-13 through value for money initiatives.
These will include improving the way the NHS buys services for patients and adjusting the price it pays for them and an emphasis on delivering more efficient, integrated and people-centred community and mental health services that will include developing common prices to reduce variation.
In other words, the tariff is to be reduced in the acute sector and is set to make an entrance in community and mental health care. Woe betide any provider unit operating above tariff.
For those in the business intelligence game, this is another marker that the NHS needs to get to grips with its data. If trusts are going to juggle the demands of raising quality and productivity while managing on a reduced budget, they had better know (a) where the money is going and (b) what impact is made by redesigning services.
This, say enthusiasts, is what BI can provide for a budget of tens rather than hundreds of thousands of pounds and with a quick return on that investment.
BI is not a big ticket item. It involves implementing a data warehouse to pull in as much information as possible from as many sources as possible and adding some tools to make sense of it.
Adrian Downing, healthcare director at Concentra, says: “The real power of BI is the ability to pull together information from finance, HR and clinical systems into one place. That has not been available before.”
Some trusts, such as North Bristol NHS Trust, have developed their own warehouse and their own dashboards and reporting tools. Others have turned to consultants.
Paul Henderson, managing director of 21C, says the landscape has changed radically over the last couple of years. “Microsoft tools such as SQL, SharePoint and CRM allow you to get your numbers under control and turn them into intelligence.”
Quite literally, he says, we are now in a position where a chief executive can take his or her lap top on holiday and, at the click of mouse, look at the status of the hospital and see in real time how many patients are expected to breach the four hour wait in A&E unless something is done rapidly.
“We have moved from using NHS data analysts as cut and paste meisters to having them develop systems that enable managers to drill into data in a matter of clicks,” says Henderson.
The debate over patient level costing
Others emphasise BI’s ability to help trusts understand where they are spending money - and how they might make efficiency savings by developing patient level costing.
David Beeson, development director at Ardentia, says this is essentially a way of making financial data relevant to activity.
Trusts are already making significant progress in service line reporting, which gives them the ability to identify the financial performance of each department and identify potential operational improvements and efficiencies, he says.
Patient level costing goes beyond service line reporting by apportioning costs to patients. It enables clinicians to identify individual patients or groups of patients whose costs may differ from the norm.
Beeson explains: “The fundamental aim of doing it is to see whether you are treating patients effectively and cost effectively.” It can be a powerful tool, enabling clinicians to engage with the finance agenda.
Fiona Boyle, finance manager at Southampton University Hospitals Trust and a member of Ardentia’s patient level and information costing user group, says: “By basing financial reporting upon actual costs incurred, what we will see is a virtuous circle.
“Cost reapportionment will lead to more accurate cost models, and an improved understanding for finance staff, clinical managers and the executive board of the activity against income. This in turn will help improve funding policy in conjunction with commissioners.”
But patient level costing is not the only game in town and, indeed, some argue that it may not be either possible or relevant to work at this level.
Downing is among them. “You can start to understand where your main costs are and where your main activities are taking place, but being able to understand at a patient level is very difficult,” he says.
He argues that too much focus on costing may lead trusts to get too hung up on financial detail and lose sight of the big picture. “In the main, all you should be looking at and trying to manage is the risk of outliers,” he says.
So, for example, he sees BI being used to identify a surgeon who takes ten minutes to do an operation that takes his colleagues an hour. “The hospital needs to look at the outcomes to see what is going on and whether this is a new money saving technique or something going wrong.”
A good example is a project Downing worked on last year while he was director of operations for Nuffield Health Hospitals. It involved developing - with Concentra - a surgical costing tool that included data on 1,500 procedures and all the cost components of each of them. This was overlaid with a Monte Carlo Simulation to examine the variables.
This not only allowed the hospital group to take into account different specialist’s preference for differently priced prostheses when identifying outliers, but also enabled managers to examine the potential financial impact of saving bed days be offering additional physiotherapy. “You can start to make some real fundamental decisions on fairly low level data,” says Downing.
Moving beyond institutions
So far, BI has been limited to single institutions. But in future this will not be enough. Consider mental health, where treatment pathways are not single episodes in a hospital but may involve care from the GP and in the community. This implies sharing information.
Beeson says mental health trusts are at the leading edge in thinking about how to price care along these pathways. He says: “Mental health is a really exciting area at the moment. For a long time they have been lagging on the IT front but now they are setting the pace. This will become the model elsewhere as more money is spent on chronic care.”
Certainly The NHS Information Centre has recognised this. It recently developed a strategy to integrate health and social care data from a variety of sources and announced a partnership with SAS to develop a business analytics solution.
Brian Derry, executive director of information services at the NHS IC, adds: “Patient care is delivered through different parts of the NHS working together in innovative ways. To fully understand the effectiveness and efficiency of the NHS in providing high quality services we need to draw the data from different organisations, manage it correctly and analyse it.
“We hope that by using SAS to integrate data held in these disparate systems, we will derive better insights and understanding, which will inform better local decision-making and help improve services for patients.”
Whatever your take on the quality and productivity agenda, BI may have something to offer.