6 Steps to Improving Health and Social Care Outcomes at Lower Costs

By Allan Watton on September 10, 2012

6 Steps to Improving Health and Social Care Outcomes at Lower CostsThe following post focuses on one of the key issues explored in our new white paper on significantly reducing the costs of Adult Social Care Services. Download your free copy here.

As you will know if you have been reading the blog over the last few weeks, improving Adult Social Care at significantly reduced costs is, and has been for quite some time, a key focus of ours. As we covered in The Reality of Adult Social Care Service Quality in 2012, councils are in a typically sticky spot of having to improve service delivery whilst reducing costs. We are finding that when we initially talk with Councils, their pursuance of trying to deliver innovation and significantly better value is not being applauded in the manner is should be. Often, this is because the ideas in the innovation process have been easier to think up, but much harder to implement in practice. This has typically resulted in failure to materially improve matters in any material way. We strongly believe that the careful commissioning of services is the only viable solution.

“Careful” is the key word, because we see far too many local authorities jumping on the commissioning bandwagon in a too-accelerated fashion, as if it is some kind of panacea by default. Whilst commissioning can result in improved service delivery and reduced costs, that is only possible when it is implemented in the correct fashion.

In this article, I want to explore six necessary steps that, in our experience, will genuinely accelerate your success for the commissioning of Adult Social Care services to result in positive outcomes.

1. Prepare a Solid Business Case

Your business case will serve as the foundation for your commissioning agreement. Its strength underpins everything else you do, so you must make absolutely sure that a solid case is put together.

To avoid accusations of self-interest and/or being partisan, it makes sense for the Business Case to be prepared by an independent organisation, and its focus should be on the costs and benefits of the proposed integration and/or third party commissioning arrangements. The key considerations are as follows:

  • Improving health outcomes and reducing long term costs, whilst understanding that upfront investment will be necessary.
  • Identifying measurable outcomes, underpinned by performance and contract management frameworks.
  • Supporting the realisation of operational and financial benefits, by ensuring ownership and measurement of actual benefits achieved.
  • Flexibility in permitting controlled experimentation, innovation, and ongoing continuous improvement.
  • Clear delineation of service elements that will remain in-house or be commissioned to private vendors.

Once a partnership is up and running, your business case will become a tool for benchmarking the provider’s performance against your long-term service improvement and cost reduction targets.

2. Understand “Expert” Responsibilities

If you plan to commission “expert” private sector providers, you should understand their inherent responsibilities. New court rulings have clarified a number of specific duties that “expert” providers must perform, most notably a duty to warn you if any of your expectations or requirements cannot be fulfilled within your specification or financial constraints.

You can find out more about the specific duties here, but the key is in implementing what you learn into any commissioning agreement that you enter into. Your partner must validate:

  1. The outcomes it can achieve,
  2. The outcomes it can’t achieve, and
  3. For the outcomes it can’t achieve, the consequential impact on the services.

With the above information clarified, you will have a better understanding of your partner’s abilities and limitations, which will subsequently define suitable compromises and workarounds.

3. Set Clear Service Expectations at the Outset

You are only likely to achieve desired outcomes if they are clearly quantified at the very beginning. The first step in doing so is to be very clear about the scope of the service – i.e. what is included, and what isn’t. This scope can then be turned into an outcome-based specification, which sets out:

  • Your objectives for each element of each service,
  • The specific outcomes you want to deliver for service users, and
  • The performance indicators that measure the achievement of these outcomes.

Although the Department of Health has published a set of desired outcomes at the national level, they still need to be translated into local specifications, which are often unique to the local population. These specifications can then be communicated to the service provider, so that it can provide feedback based upon its expertise.

Once specifications are agreed, they should be documented so that you and your provider can agree them formally.

4. Use the Right Contract Negotiation Tools

If you are thinking of integrating Adult Social Care with another Council or an NHS Trust, you will likely be using a Section 75 agreement. The starting point for creating the Section 75 agreement, or any commissioning agreement with a private sector partner, should be a set of specification and contractual process maps. These help you and your service provider understand the operational methods that need to be used to deliver and manage the contract.

The purpose of these maps (which will need to be aligned to suit the specific services you will commission/integrate) is to facilitate effective dialogue between operational and legal teams. This is done by creating a diagram of the contract which both groups can understand. Once the diagram’s content has been agreed, changes can be made to a template Section 75 or private sector commissioning agreement. Templates usually contain the majority of the contract terms, so your legal team avoids extensive drafting.

This process of providing a universally understood format for agreeing terms is far more efficient than traditional methods. It is also ensures that your desired outcomes are clearly defined in the Section 75/commissioning agreement itself. Due to this method’s clear simplicity, you can expect negotiation times to be cut drastically and to build a strong relationship foundation aligned to successful achievement of re-shaping Adult Social Care.

5. Put a Performance Management Framework in Place

A commissioning agreement is only as good as its performance management framework. This framework should feature a number of key areas; three of which are:

  1. Measurable Key Performance Indicators (KPIs). A partner’s performance should only be judged by measurable KPIs that align with your desired outcomes, which should be backed by a consistent and clearly defined measuring and reporting mechanism.
  2. A mechanism to deal with non-performance. This should be intended to help your service partner to improve its performance, without undermining key aspects of your contractual relationship. If your provider struggles to improve, you need an appropriate escalation process which helps to resolve issues efficiently and amicably, whilst taking financial ramifications into account.
  3. An exit management process. Should the worst happen, you must have a process by which an agreement can be wound down in an orderly fashion. Continuity of service and a smooth transition to a new provider are key requirements.

6. Manage and Document Changes to the Services

A successful service provider partnership is typically marked by adaption and innovation. As the needs of service users evolve or new technology becomes available, you may need to amend or stop an existing service, or introduce a new one. You therefore need a way to manage this change process.

An effective reshaping process ensures that changes to specifications, operating procedures or contract management processes get documented, so the contract terms and schedules remains aligned with what is happening on the ground. It is vital to do this, because changes in your behaviour or your partner’s behaviour will change how the contract is interpreted, even if the written contract is not updated.

The contract should be reviewed on a six monthly cycle, to sweep up all the major, minor and incremental service delivery changes that happen on a day-to-day basis.

A key benefit of the effective management of changes to the services is that it ensures that you and your provider are always thinking about the service delivery process. This encourages experimentation, piloting and reshaping services for lower costs and better outcomes.

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