Health Leaders’ Forum · 2015-08-31 · structure is fit for purpose and develop commissioning...

Commissioning Masterclass

Health Leaders’ Forum

28 August 2015

Overview of the session

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How do you do it? ► What is the process?

► How do you apply the process?

What capabilities are

required?

► What do you do?

► Are you ready?

► How do you get ready?

What is commissioning? ► How is it defined?

► Who is involved?

What is the context? ► Transition from Medicare Locals

► Many unknowns

What is the context?

PHN objectives

► Primary Health Networks (PHN) are being established to: deliver

efficient and innovative models of funding and health service

delivery

► PHNs will need to adjust to larger geographical boundaries and

more diverse populations

► Reduced operational budget in comparison with Medicare Locals.

► Strong stakeholder engagement, especially with general practice,

while effectively managing change and ensuring service continuity.

► Need to become effective commissioners of services to meet the

health needs of their local populations


Key PHN commissioning activities in 2015-16

To build commissioning

capability, PHNs are expected to:

Ensure their organisational

structure is fit for purpose and

develop commissioning

capabilities

1

Conduct a baseline needs

assessment and market

analysis in conjunction with

LHDs and other jurisdictional

organisations (by March 2016)

2

Maintain existing Medicare

Local contracts during 2015/16

3

Review existing service

contracts and delivery for

alignment with prioritised

health needs

4

Develop a procurement plan

based on needs assessment,

market analysis and review of

current service provision (by

May 2016)

5


Current uncertainties

Knowns Unknowns

►Total funding: $842 million over

three years from 2015-16

►Streams of funding: Operational,

Flexible, Programme and

Innovative & incentive

►Funding to reflect: population,

rurality, socio-economic factors

►Performance evaluation

framework to be established

►PHNs to establish Clinical councils

and Community Advisory

Committees

►Individual PHN funding*

►Target outcomes, national

priorities & KPIs

►Degree of local flexibility

►Will DoH broaden the role as

commissioner for other funding

streams?

►What exactly does DoH require

for the Needs Assessment and

Procurement Plan?

►How will the market respond to

commissioning?


What is commissioning?

What is commissioning?


IS : IS NOT JUST:

► “Process of deciding what services or

products are needed, acquiring them

and ensuring that they meet

requirements”

► “Putting in place the right services for

the right people at the right time to

achieve the right outcomes”

► A HOLISTIC approach to designing,

delivering and evaluating services to

effectively and efficiently meet the needs

of a defined population within the

resources available”

► Purchasing

► Procurement

► Buying

► Contracting

► Supply chain

management

► Strategic sourcing

► Category

management

“A hateful word prone to ambiguity!”

Who is involved in commissioning?

Commonwealth

Department of

Health

Queensland

Department of

Health

Primary Health

Networks

Hospital and health

services

Primary health

care advisory

group

Patients

Hospitals GPs Allied health Community

Health

PHN Board

► Clinical

councils

► Community

Advisory

Committee

Funding Relationship Service delivery


NGOs

How do you do it?

Commissioning cycle

Execution

► Defining service

specification

► Setting commercial

principles & pricing

► Procuring services

► Designing contracts

Strategic Planning &

Needs Assessment

► Health Needs

Assessment

► Reviewing current

service provision

► Deciding priorities &

outcomes

► Planning capacity &

managing demand

Design

► Designing services &

funding models

► Understanding supply

► Market development

► Commissioning

strategy

Monitoring and

Evaluation

► Monitoring and

evaluating outcomes

► Managing

performance against

KPI and future needs

1

2

3

4

Patients


Strategic Planning & Needs Assessment


Predictive Modelling

Descriptive Analysis Key Steps

► Organisational alignment

► Needs assessment: access, quality,

outcomes

► Demographic and geographic

analysis

► Historic profiling

► Risk analysis

► Forecasting

► Outcomes setting and prioritisation

► Modelling and managing demand

(e.g. behavioural economics, e-

health)

► Capacity planning (volumes cost)

Design


Key Steps ► Assessing strengths and

weaknesses of current services

► Benchmarking and evaluation

► Identifying opportunities for service

integration

► Market assessment and

development

► Supplier analysis

► Understanding barriers to entry

and exit

► Partnership building

► Capacity/capability building

► Identifying and defining incentives -

financial, other

Execution


Key Considerations

► Develop commercial approach

► Competition vs collaboration

► Co-design

► Outcomes based contracting

► Define commercial principles – pricing, risk allocation, failure regime

► Procurement strategy (two stage, competitive dialogue etc)

► Go to market

► Design contracts

Monitoring & Evaluation


Key Steps

► Performance management and

evaluation

► Sound program logic

► Long term outcomes and

interim indicators

► Indicators as KPIs

► Pay for success?

► Multi-source data (patients,

Net Promoter Score, staff)

► Regulation of quality

► Monitoring market health

► Financial viability

► New entrants

► Competition

Organisational

Local

National

National performance

framework

PHN evaluation

program logic

Case Study

Case Studies: Newquay Pathfinder


Strategic

alignment

Pilot program providing integrated

frailty pathways to help:

► Improve independence of older

persons

► Avoid hospital & improve quality of

life

► Enable providers to coordinate

and improve effectiveness

► Reduce activity and spend across

health and social care systems

“ People, Place, Purpose”

Strategic Planning


Strategic

alignment

1

Key Steps

► Outcomes setting

► International best

practice

► Cohort identification:

► Primary Care Risk

stratification tool

► Threshold setting &

exclusions

► Clinical review

► Community consultation

1

Design


2

Strategic

alignment

Primary Care

Trust Hospital

Age UK

Multi disciplinary teams

Volunteers, case co-ordinators, GPs, social

workers, matrons and community nurses

Patients

Advisors

Commissioning

Structure

Execution

Key features of the commercial agreement:

3

Dividend shared

Contracting

parties

Working capital

Funded from

existing budgets


Monitoring and Evaluation

23% improvement in quality of life

87% of practitioners found their work meaningful and

87% of practitioners said integration is working

10% of local people

now providing community/peer support

30-40% reduction in non elective admissions

5% reduction in cost for adult social care

4


What capabilities do you need?

EY Maturity matrix

Strategy & planning

Governance & control

Patient & outcome focus

Financial sustainability

People & capability

IM & Technology

Forming

Developing

Mature

Model


PHN Commissioner Capabilities

Strategy & Planning ► Organisational alignment - form and functions

► Conceptual thinking & market awareness

Governance & Control ► Organisational understanding of commissioning

► Clear accountabilities

Patient & Outcome Focus ► Knowledge of patient preferences

► Connection to community and clinical expertise

Information & Technology ► Data access + analysis (needs, performance)

► Real time monitoring

Financial Sustainability ► Cost and demand modelling, commercial

approaches, incentives

People ► New functions and culture

► Specialist skills - analytics, commercial, legal


Provider Capabilities


Strategy & Planning ► Business model and new functions

► Knowledge of competitive environment

Governance & Control ► Leadership focused on change management

► Informed and supportive Boards

Patient & Outcome Focus ► Commissioner priorities and provider impact

► Patient choices and satisfaction

Information & Technology ► Service quality, case management

► Continuous improvement and innovation

Financial Sustainability ► Full cost of services and effective pricing

► Attracting investment

People ► Staff culture and capabilities

► Value of collaboration

Capability development framework

A mix of strategies are available to PHNs and providers to build

commissioning capability in 2015-16 while preparing for the longer-term

Retain

Procure

Co-source Develop

Redeploy

Recruit

Commission Building and accessing capability

Source New


What do you need to do next?


EY Specialist Workshops ► EY provides formal learning

Proof of Concept initiative ► Active learning

Commissioning

Development Plan ► Gap analysis

► Plan for developing capability

Rapid Skills & Capability

Assessment ► Define required skills and resources

Key Contacts

Key Contacts


Alex Martin, Director

Tel +612 8295 6395

Mobile +61 424 715640

Email [email protected]

Lucille Chalmers, Manager

Tel +613 30113571

Mobile +61 488 303 406


Stephen McKernan QSO, Partner

Mobile +64 21 222 1962


Amanda Evans, Partner

Tel + 61 2 9248 5181


Adrian Clutterbuck, Director

Tel +617 3011 3573

Mobile +61 428 531 492


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organization, please visit www.ey.com/au

© 2015 Ernst & Young Australia.

Liability limited by a scheme approved under Professional

Standards Legislation

All Rights Reserved.

S1427090

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Disclaimer

This presentation may be used by the NSW Government for

the purpose of discussing the Outcomes based contract

project only pursuant to the terms of our engagement. We

disclaim all responsibility to any other party for any loss or

liability that the other party may suffer or incur arising from or

relating to or in any way connected with the contents of our

report, the provision of our report to the other party or the

reliance upon our report by the other party.

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Health Leaders’ Forum · 2015-08-31 · structure is fit for purpose and develop commissioning...

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