Developing robust capitated budgets: A Year of Care tariff approach – lunch and learn – 11 January 2016

1. www.england.nhs.uk
Developing Robust
Capitated Budgets:
A Year of Care Tariff
Approach
Southend LTC Year of Care
Commissioning Early Implementer
Site
Steve Downing, Head of Finance,
NHS Southend CCG
Bill Wood, Business Intelligence Co
leader, NE London CSU
Beverley Matthews, LTC
Programme Lead, NHS England
Monday 11th January 2016
LTC Community of practice

2. www.england.nhs.uk
LTC Framework
Commitment
to Carers
Frailty
Health Ageing
Guide
Fire Service as
an asset
Care Homes
Quick Guides
Care & Support
Planning
Navigating Health
& Social Care
Self Care
Ambitions for
End of Life Care
Our Declaration
Delivery Models
Planning for Change:
• Capitated Budget
• Contracting
• Simulation Modelling
Patient and
Service Selection
Planning for Change:
Workforce
Whole Population
Analysis;
Understanding your
population
LTC Dashboard LTC Toolkit

3. www.england.nhs.uk
Long term conditions resources
Simulation model
Unbundling recovery simulation model

4. www.england.nhs.uk
7
Using behavioural
change to open minds
#A4PCC – Action for Person-Centred Care
Person with
long term
condition
o Make a declaration at
www.engage.england.nhs.uk/survey/ltc-
declaration
o Tell your teams about our work
o Encourage them to make a declaration
o Ask them to feed back thoughts and
ideas
o Use our hashtag – #A4PCC – when you
see work that is relevant to person-
centred care for people with LTCs
o Let us know of any events, activities or
social media opportunities that we can
join forces with you

5. www.england.nhs.uk
Date Topic Led by and details of session Venue
15 January
2016
12pm
How a telephone based coaching model
at large scale can help with admission
avoidance and enhance quality of life for
people with LTC
Magnus Liungman & Chris Bound
Health Navigator Limited
Via WebEx
20 January
12.30pm
Implementing the six Quick Guides to
bring clarity on how best to work with the
care sector. www.nhs.uk/quickguides
Nicola Spencer and Emily Carter
NHS England
Guest speakers:
• Angela Dempsey, - Baker Tilly on the
Quest4care tool
• Dawn Moody – North Staffs on MDT
working and a model implemented in a
CCG
Via WebEx
TBC Self-management in the community and
on the Internet
Peter Moore, The Pain Toolkit Via WebEx
TBC The success and impact of lay health
coaches
Anya De Longh & Jim Phillips Via WebEx
LTC Virtual Learning Community Lunch & Learn webinars:
Sharing and Learning …

6. www.england.nhs.uk
LTC YoC Commissioning - EIS sharing learning...
Date Webinar Led by and details of session
11 January 2016 Southend EIS
Developing robust capitated budgets
Steve Downing,
Head of Finance, Southend CCG
19 January 2016 Leeds EIS
integrated data to support service
redesign decision making
Tricia Cable, LTC YoC Commissioning Programme lead,
Leeds EIS
- The Leeds approach
- How and who...using the integrated data
- Challenges, lessons learned...what next
11 February 2016 Kent EIS
Commissioning Integrated models of
care
Alison Davis, Integration Programme Health and Social Care,
Working on behalf of Kent County Council and South Kent
Coast and Thanet CCG's
- The South Kent model of care (what it looks like)
- Roadmap to delivery
- Contracting models and evaluation.
March 2016 West Hants EIS
Topic TBC
Kate Smith, West Hants CCG
All webinars 12.30pm to 1.30pm unless stated...

7. Developing a
Year of Care Tariff
NHS Southend CCG

8. Aim of process
• To develop a tariff model that reimburses providers for a year of care
(YoC) for patients with Long Term Conditions (LTC)
• Tariff should facilitate efficiencies through improved care of patients
with LTC
• Tariff should move away from episodic care and towards a single
tariff for a whole year of care across a range of health and social
care services.
8

9. Building a Model: Collating Data
• Data from available systems has been taken and collated into a
single data system
• SUS – for Acute Care
• EMIS / System One – for primary Care (prescribing)
• _____ - For social care
• Areas not currently include: CHC, Mental Health, and Non-SUS
Acute
• IG guidelines have ensured that this data is only shared where
consent or appropriate s251 arrangements are in place.
• Original analysis occurred prior to prior s251 ending and has
meant it cannot yet be updated.
9

10. Building a Model: Time Period and Data
• Data from various systems, across two years was
collated into a single dataset
• Years used are 2011/12 and 2012/13.
• Each patient is marked with the specific Long term
conditions that they suffer, based on primary care
registers
• Each patient is also marked with the number of long
term conditions that they suffer.
10

11. Building a Model: Conditions
• Premise based around the notion that patients care needs are
determined by
• the number of LTCs the patient has
• Specific LTCs that the patient suffers
• 14 unique LTCs were looked at in this model
11
Congestive Heart Failure Cancer
COPD Alcoholism
Dementia Depression
Chronic Lung Disease Smoking
Chronic Kidney Disease Asthmatic
Hypertension Coronary Artery Disease
Diabetes “Other”

12. Building a Model: Calculations
12
• Model cycled through each divisions of patients based on the
number of LTCs and identifying patients who had a specific LTC
within this bracket
• For example one division of the model looks at patients who have 3
LTCs, one of which is “Coronary Artery Disease”.
• In each division the overall metrics are calculated for the cost across
two years, this includes the following calculations
- Mean Cost
- Median Cost
- Standard Deviation
- Top 10th Percentile
- Bottom 10th Percentile
- Mean excluding top and bottom 10th percentiles
- Median excluding top and bottom 10th percentiles

13. Building a Model: Summarising Results
13
• With all cycles complete the results were collated and aggregated
into a single table indicating the number of LTCs, and the condition
specified in the division, showing the mean and median annual cost
once top and bottom 10th percentiles were removed.
• Either the mean or median cost can then be used as a proxy tariff.
• There are benefits to using either of these values
• Mean – typically considered ‘true’ average as mathematically more understandable. Includes all
known values in calculation. Better for larger samples
• Median – typically considered more reliable as will ignore outlier values – better for smaller samples
or those suffering from outliers.
• Acute NTPS 2015/16 uses mean as basis for tariff calculation from
Reference cost data.

14. Building a Model: Reviewing Results
14
• Divisions showed a tendency to have a maximum mean cost at 5-6
long term conditions, rather than peaking at the max count of 7(+).
• Example shown for Asthma
• Suspect smaller sample size
leads to bias at this point

15. Building a Model: Reviewing Results (2)
15
• Number of patients in higher counts of LTC were small, such that
Confidence Intervals are very large
• Example below

16. Building a Model: Utilising Model Results
16
• Building the model allows for correlation in costs to be assessed
across specific LTCs and the number of LTCs along-side these.
• Majority of divisions appeared to fit a Logarithmic trends, though
some were more linear or even Exponential.
• Thus these trends have been calculated alongside the actual costs
– manually excluding visible outliers – to build a trend.

17. Building a Model: Utilising Model Results
17
• The next series of charts show the result of this re-modelling

18. Building a Model: Utilising Model Results
18
• Alcohol
- One point excluded due to low sample size (<10)

19. Building a Model: Utilising Model Results
19
• Asthma
- No points excluded

20. Building a Model: Utilising Model Results
20
• Cancer
- No points excluded

21. Building a Model: Utilising Model Results
21
• Chronic Kidney Disease
- One point excluded as visually an outlier

22. Building a Model: Utilising Model Results
22
• Chronic Lung Disease
- two points excluded as low sample size (<10)

23. Building a Model: Utilising Model Results
23
• COPD
- One point as visually outlier

24. Building a Model: Utilising Model Results
24
• Chronic Heart Failure
- One point excluded as visual outlier

25. Building a Model: Utilising Model Results
25
• Coronary Artery Disease
- No points excluded

26. Building a Model: Utilising Model Results
26
• Dementia
- trend indicates exponential curve (red) rather than logarithmic

27. Building a Model: Utilising Model Results
27
• Depression
- One point excluded as visual outlier, another as small sample

28. Building a Model: Utilising Model Results
28
• Diabetes
- One point excluded as visual outlier, another as small sample

29. Building a Model: Utilising Model Results
29
• Hypertension
- One point excluded as visual outlier,

30. Building a Model: Utilising Model Results
30
• Smoking
- One point excluded as visual outlier,

31. Building a Model: Utilising Model Results
31
• Other LTCs
- One point excluded as visual outlier,

32. Building a Model: Utilising Model Results
32
• Full picture (combined model)

33. Building a Model: Converting to a Tariff
33
• Tariff can therefore be based on number of LTCs and presence of
specific LTCs with higher cost determinant at that banding.
• For example:
- Patient with 3 LTCs (Depression, Asthma and Dementia)
- Highest valued LTC is Dementia = £3,080.42 annual modelled cost
- Patient develops 4th LTC of Diabetes
- Dementia remains highest valued LTC within 4 LTC group = £3,800.58
• Results in 77 unique tariff levels.
• How does Tariff compare to actual when applied to historic
data?

34. Applying the Model: Comparison
34
Actual Cost 2011 Actual Cost 2012
Modelled Tariff for
Year of Care
Bottom 10th
Percentile £ 883k £ 762k £ 4,713k
1 LTCs £ 229k £ 192k £ 1,059k
2 LTCs £ 354k £ 308k £ 1,923k
3 LTCs £ 192k £ 169k £ 1,106k
4 LTCs £ 71k £ 63k £ 398k
5 LTCs £ 27k £ 24k £ 165k
6 LTCs £ 6k £ 4k £ 41k
7 LTCs £ 4k £ 2k £ 21k
Central 80% £ 7,574k £ 6,551k £ 4,197k
1 LTCs £ 3,080k £ 2,910k £ 1,292k
2 LTCs £ 2,318k £ 1,939k £ 1,426k
3 LTCs £ 1,226k £ 1,072k £ 883k
4 LTCs £ 571k £ 407k £ 374k
5 LTCs £ 219k £ 132k £ 144k
6 LTCs £ 134k £ 73k £ 59k
7 LTCs £ 27k £ 17k £ 20k
Top 10th
Percentile £ 7,428k £ 6,532k £ 996k
1 LTCs £ 4,173k £ 3,749k £ 360k
2 LTCs £ 1,788k £ 1,468k £ 308k
3 LTCs £ 957k £ 811k £ 197k
4 LTCs £ 382k £ 338k £ 76k
5 LTCs £ 90k £ 125k £ 36k
6 LTCs £ 17k £ 36k £ 8k
7 LTCs £ 21k £ 5k £ 10k
Grand Total £ 15,885k £ 13,845k £ 9,906k
• Table (right) shows the impact
of applying the model to the
baseline data
• Total effect is underfunding of
£3.9m from 2012 actuals (28%)
• Model overfunds bottom 10th
Percentile by over 500% (2012)
• Model underfunds top 10th
Percentile by 85% (2012)
• Model underfunds central 80%
by 36% (2012)

35. Applying the Model: Comparison
35
• Table (right) shows over/under
funding ratio
• Looking at central 80%, 1 LTC
position has largest under
funding.
• Linked to shape of trend line
used – which will start below
first point.
Over/Under Funding
(%)
Bottom 10th
Precentile 519%
1 LTCs 453%
2 LTCs 525%
3 LTCs 554%
4 LTCs 534%
5 LTCs 589%
6 LTCs 935%
7 LTCs 736%
Central 80% -36%
1 LTCs -56%
2 LTCs -26%
3 LTCs -18%
4 LTCs -8%
5 LTCs 9%
6 LTCs -20%
7 LTCs 14%
Top 10th Percentile -85%
1 LTCs -90%
2 LTCs -79%
3 LTCs -76%
4 LTCs -78%
5 LTCs -71%
6 LTCs -77%
7 LTCs 73%
Grand Total -28%

36. Next Steps for revising model:
36
• Update data to 2014/15 or later
• Remove patients who died within 12 months from end of data set period. Subject to
use of PHMF (Public Health Mortality File)
• Re-assess or adjust use of logarithmic trend lining, which may account for significant
underfunding of patients with 1 LTC.
• Explore potential to add in further patient factors (age, gender etc.)
• Apply modelling process to another area and compare against results seen in
Southend CCG.

37. Issues and Barriers
• Data sharing agreements
- IG issues
- Logistics in getting sign up
• Data sharing and linking data
- Coding issues and using key indicators (NHS number)
- Solution to link data and pseudonymisation
• Organisational sign up
- Ensuring all partners who you want to receive data from have a data
sharing agreement to provide information to your designated data
processor.
37

38. Other considerations and lessons learnt
• Vehicle/project to use tariff
- Tariff is a means for payment not the solution to commissioning
- Conduit to develop different commissioning models and pathways.
• Commissioning at patient level
- Commissioning at cohort of patients and pathways and not services.
38

39. Want to know more?
If you would like to discuss any element
of this presentation, please contact our
Essex POD team on:
Tel: 01268 594490
Email: William.wood1@nhs.net
www.nelcsu.nhs.uk