Fair playing field needed for IS in NHS payment system – NHSPN

There needs to be a fair playing field for independent providers in future NHS payment systems, the chief executive of the NHS Partners Network has said.

Speaking at the Westminster Health Forum seminar: priorities for improving payment systems and reimbursements in healthcare, David Hare said independent providers contributing services to the NHS want to know that the ‘rules of the game’ will be policed as much as possible to ensure they can compete fairly with other organisations in the system.

Saying there were ‘misaligned incentives’ between acute services and those provided in NHS primary and community care, he called for future payment models to include a pricing strategy that enables providers to take a longer term view and flex their service models to reflect patient need over five to ten-year periods.

‘We have a tariff in [acute services] which incentivises activity inevitably – and then primary and community care which almost on some levels do the opposite – in a world where we are trying to move some more activity into the primary and community care space … and that tension and that conflict is quite real’, said Hare.

Commenting on financial strains on the NHS, Hare said a culture of bailouts and payments coming from ‘different routes’, such as the £2.5bn provider stabilisation fund, was ‘corrosive’ and should not become the norm.

‘We are living in a world with huge financial pressures on the NHS where half of the system, certainly in the public provider sector, is having to receive a set of payments from so many different routes … we have to try and break out of that cycle where money is coming from  so many different routes and it’s unclear where that’s coming from,’ he said.

He added that private providers were finding it difficult to justify long-term investments in the current pricing and operational environment.

Moreover, he warned that efforts by some NHS organisations to repatriate care away from the independent sector back to the NHS was sending out a ‘difficult signal’.

He told delegates: ‘If you want to have a mature partnership with all operators in a local area … actually saying ‘our ambition is to repatriate this’ as opposed to starting from principles around a sensible pricing system, is not a particularly helpful signal to send.’

Independent sector providers have reported a softening in NHS demand over the last 18 months following the removal of waiting times targets and growing pressure on NHS budgets.

However, Hare said it was important to incentivise quality in the payment system as well as encourage investment and risk-taking, which he said the independent sector can do as a mature partner to the NHS in both local and national systems.