This presentation was made by Tom LING, Rand Europe, at the 5th Meeting of the joint OECD DELSA/GOV Network on Fiscal Sustainability of Health Systems held on 4-5 February 2016 at the OECD Conference Centre in Paris.

1. Commissioning for sustainable
healthcare
Tom Ling, RAND Europe
Paris, OECD, 4th February 2016

2. 2
The following issues will be addressed:
1. How (good) commissioning is seen in England and what is
expected of it
2. How commissioning contributes to sustainable healthcare systems
3. Examples of how this works in England and where strengths and
weaknesses lie

3. 3
What is commissioning, what is
hoped for it?
Commissioning:
• Changes the transaction between members of the public with needs and the
agencies responsible for meeting those needs
• Has much in common with: ‘purchasing’, ‘procurement’, ‘contracting’, ‘strategic
purchasing’ and ‘competitive tendering’
• Typically involves the retention of a monopoly of public financing
• OECD helpfully distinguish between passive and strategic
The hope in England is that Commissioning will:
• Create a champion for personalised or (otherwise) high standards of care
• Create competition and innovation to meet needs more effectively and efficiently
• Temper the risk of (self-serving) providers delivering poor quality or even abusive
care
• Facilitate long-term planning and more preventive work to improve outcomes for
given level of expenditure

4. 4
The commissioning system in England
Source: House of Commons Library

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Commissioning system in England

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Not pursued throughout the UK
– (Many) people in Scotland believe they get better care by encouraging
collaboration among providers, by focusing on maintaining and
improving standards, and supporting quality improvement activities
– Scotland and Wales abandoned the purchaser provider split in 2004
and 2009 respectively (and Isle of Wight never adopted competitive
model)
– Northern Ireland has a ‘half-way-house’

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Most (English) versions of
commissioning cycle look something like
this:

8. 8
Where commissioning in England fits in
sustainable healthcare systems
New
thinking,
services and
technologies
Evidence and
guidelines
Sustainable
health care
Efficient &
effective use
of resources
Commissioning and
funding health services
and service efficiency
Applying evidence,
guidelines, managing
and implementing
Innovation and improvement
pipeline
RISING DEMAND RISING COSTS

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Perceived weaknesses in UK
commissioning architecture
New
thinking,
services and
technologies
Evidence and
guidelines
Sustainable
health care
Efficient &
effective use
of resources
Commissioning and
funding health services
and service efficiency
Applying evidence,
guidelines, managing
and implementing
Innovation and improvement
pipeline
Funding cycles and logics often fit poorly with delivery and prioritisation

10. 10
Sustainable healthcare systems: where
commissioning fits
New
thinking,
services and
technologies
Evidence and
guidelines
Sustainable
health care
Efficient &
effective use
of resources
Commissioning and
funding health services
and service efficiency
Applying evidence,
guidelines, managing
and implementing
Innovation and improvement
pipeline
Funding cycles and logics often fit poorly with delivery and prioritisation

11. 11
Sustainable healthcare systems: where
commissioning fits
New
thinking,
services and
technologies
Evidence and
guidelines
Sustainable
health care
Efficient &
effective use
of resources
Commissioning and
funding health services
and service efficiency
Applying evidence,
guidelines, managing
and implementing
Innovation and improvement
pipeline
Funding cycles and logics often fit poorly with delivery and prioritisation

12. 12
UK commissioning today – searching for solutions
– but weakly developed commissioning for
innovation and improvement
New care
models,
services and
technologies
Evidence and
guidelines
Sustainable
health care
Efficient &
effective use
of resources
Commissioning and
funding health services
and service efficiency
Applying evidence,
guidelines, managing
and implementing
Innovation and improvement
pipeline
New models of care, integrated care organisations, IPCs
all CCGs to implement NICE guidelines, etc.

13. 13
UK commissioning today – searching for solutions
– but weakly developed commissioning for
innovation and improvement
New care
models,
services and
technologies
Evidence and
guidelines
Sustainable
health care
Efficient &
effective use
of resources
Commissioning and
funding health services
and service efficiency
Applying evidence,
guidelines, managing
and implementing
Innovation and improvement
pipeline
New models of care, integrated care organisations, IPCs
all CCGs to implement NICE guidelines, etc.

14. 14
UK commissioning today – searching for solutions
– but weakly developed commissioning for
innovation and improvement
New service
models,
devices and
medicines
Evidence
and
guidelines
Sustainable
health care
Efficient &
effective
use of
resources
Commissioning and
funding health services
and service efficiency
Applying evidence,
guidelines, managing
and implementing
Innovation and improvement
pipeline
New models of care, integrated care organisations, IPCs
all CCGs to implement NICE guidelines, etc.

15. 15
UK commissioning today – searching for solutions
– but weakly developed commissioning for
innovation and improvement
Search
frictions
Misaligned
incentives
Sub-optimal
commissioning
Principal agent
problems and
risk aversion
Commissioning and
funding health services
and service efficiency
Applying evidence,
guidelines, managing
and implementing
Innovation and improvement
pipeline
New models of care, integrated care organisations, IPCs
all CCGs to implement NICE guidelines, etc.

16. 16
Looking forward…Kings Fund say a
commissioning strategy should include:
• a compelling vision for the future, underpinned with clear strategic
objectives reflected in an explicit statement of desired outcomes and
key performance indicators
• a clear statement of the organisation’s purpose and approach that
takes appropriate account of the external context
• a perspective which balances national and local priorities
• evidence that the strategy has been shaped by the ‘intelligence’
made available to the governing body
• demonstrable links to the needs of users, patients and communities
• a longer term view (with at least three to five year planning horizon)
including a long-term financial model and risk analysis.
http://www.kingsfund.org.uk/sites/files/kf/Good-governance-for-Clinical-Commissioning-
Groups-Introductory-Guide-December2011.pdf

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Kings Fund outline is helpful but misses
how commissioning sits within the
wider architecture of sustainable
healthcare• Market intelligence
– to understand supply and demand
• Market structuring
– to shape market behaviour
• Market intervention
– to deliver the kind of services needed by the community
• Providing signals and incentives for long term innovation and
improvement including investing for future benefit and to achieve
savings for others and in addition…
• It requires clear and consistent messages, fairness in competition,
and relationship-building with provider

18. 18
The example of Integrated Personal
Commissioning

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Achieving a long term shift in provision

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Alongside a long-term shift in demand

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Commissioning in England –
strengthen further alignment with other
drivers?
Source: House of Commons Library

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THANK YOU