1. features
Following a successful pilot scheme, service line reporting
is set to grow in influence within the mental health
sector, as Duncan Orme and Philip Sugarman explain.
service line reporting
Service Line Reporting (SLR) has become St Andrew’s Healthcare, the UK’s largest All healthcare organisations will in the
well established within the NHS acute mental health charity, is a leading provider future need to monitor costs and outcomes
healthcare sector. This follows a pilot to the NHS of specialist services across of specific treatments, at this granular level,
programme, run in association with the mental health, learning disability and brain to boost the performance of the service as a
NHS foundation trust regulator, Monitor. injury. Of course specialist in-patient whole. For example, a few instances of
The technique allows an individual services of this kind are run on a ward-by- long-term sickness may be raising the costs
service, ward, or department to understand ward basis, so income and costs are clearly and limiting the clinical performance of a
the level of cash it is generating as EBITDA identified to each ward. particular ward. A second example would
(earnings before interest, tax, depreciation & The charity increasingly delegates be a particular service has been full with
amortisation), rather than only measuring financial responsibility, along with patients, and for some time slow to respond
this for the whole organisation. The service responsibilities for care, cleanliness and the to referrals, leading to a fall in demand, an
also obtains a fine-grained understanding of environment to local service and ward indicator which flags up early the meaning
the individual costs of procedures or levels managers. As in so many other large of a fall in profit.
of care it is undertaking for patients. industries, decentralisation and the Convenient, click-of-a-mouse drill-down
This accounting discipline is a vital empowerment of local managers with information at a service line level allows the
building block for creating financial information are the key step in modernisation. charity to quickly identify and implement
responsibility within any organisation, and Devolution of financial responsibility actions exactly where needed. In these
it is therefore not surprising that Monitor allows the board to focus on strategic examples the charity delivered supportive
has encouraged its adoption. direction, whilst monitoring performance back-to-work programmes for key
Within the acute sector a well- with a balanced scorecard of key indicators individuals, and a targeted marketing
established national tariff, giving a cost per for the charity, drilling down to data for each initiative to let commissioners know that St
case of clinical care, has aided the early service and to each ward only if required. Andrew’s was again able to provide a
implementation of SLR by ensuring that prompt service.
income may be easily attributed to profit/ indicators St Andrew’s experience of performance
cost centres. For mental health providers, The indicators used at St Andrew’s currently improvement, using detailed information
SLR is best established in the independent include financial performance, demand, generated by service line reporting, may also
sector, with individual business units clinical standards, mental health outcome, be seen in other organisations. The recent
reporting their financial results including training, sickness, staff turnover and more, Monitor best practice guide How service-
profit (‘surplus’ in a charity) on a monthly giving a rounded view of performance. The line reporting can improve productivity and
basis. However, NHS block contracts – with charity is further developing reporting tools performance….. describes evidence of
income not closely related to activity – have which allow information to be drilled down improved strategic planning and efficiencies
meant SLR is not well established within to individual patient level. attained using SLR from Germany, New
equivalent NHS providers. Zealand, Norway, the US and Canada. The
24 health service review December 2007
2. ‘Convenient, click-of-a-mouse drill-down information at a service line level
allows the charity to quickly identify and implement actions exactly where needed.’
guide also sets out how acute sector pilots much of this role, with nurses at ward of decentralisation, with devolution of
in the UK have identified opportunities for manager grade covering closely related responsibility for performance.
increased productivity by providing Boards, wards. This brings both savings and
managers and clinicians with information learning between units. Other teams have Duncan Orme – Director of Finance & IT
on the profitability of their services. moved toward general healthcare assistant and Philip Sugarman – CEO and Medical
roles, working flexibly across the allied Director, St Andrew’s Healthcare
lean thinking health professions, bringing more joined up
St Andrew’s has found that SLR enables care to patients, and further improving the FURTHER READING
‘lean thinking’, improving the value of cost base. P Sugarman & J Watkins (2004).
services and eliminating waste. This is ‘Balancing the Scorecard: Key
achieved when decisions are taken by those care pathways Performance Indicators in a Complex
able to identify what really matters to SLR also aids the development of defined Healthcare Setting’. Clinician in
patients and for staff delivering a service. ‘care pathways’ at St. Andrew’s. Individual Management 12, 129-32.
Resources can be more effectively deployed, patients make progress through the P Sugarman (2007) ‘Governance and
with more therapeutic activities, a better pathway, from a higher dependency area on Innovation in mental health’ (editorial)
ward environment, and better models of admission, moving through several wards Psychiatric Bulletin 31: 283-285.
clinical staffing. toward discharge. The costs of each step in
For example, two of our ward managers the pathway of care are transparent within R S Kaplan & D P Norton, The Balanced
have recently reviewed the layout of rooms the charity, which is able to set a meaningful Scorecard (Harvard Business School
used for the management of disturbed tariff. In specialist areas of mental health Press Boston, 1996)
patients, but normally ‘out of use’ for living and learning disability NHS commissioners J K Liker, The Toyota Way – the company
and therapy space. They discovered that a have for some time been moving towards that invented lean production (McGraw-
modest scheme, funded by the ward itself, tariffs based on levels of ward security and Hill, 2004)
has brought these into use more flexibly, patient dependency, with payment by results ‘Trading Places’, Healthcare Finance
improved the ward environment, and raised being more promising for definable (Healthcare Financial Management
the number of patients accommodated, and outpatient treatment programmes. Association, March 2007)
the EBITDA. To conclude, it is clear that the SLR
St Andrew’s has several examples of techniques, which have been developed in the How service-level reporting can improve
these local ‘investments’, led by ward and acute sector, will increasingly be providing the productivity and performance of NHS
service managers, which typically have a value for providers and commissioning foundation trusts (Monitor Independent
payback time of a few months. Some teams arrangements within the mental health, Regulator, December 2006)
have reworked the role of ward manager, learning disability and brain injury sectors. Daniel Jones and Alan Mitchell, Lean
empowering nurses at lower grade to fill SLR works well as part of a wider programme Thinking in the NHS (NHS Confederation)
health service review December 2007 25
