Patient level costing in the NHS: driving collaboration or being driven by competition?

Arrival: 12pm Seminar: 12.45pm - 1.45pm.

Tea, coffee and sandwiches provided (please register if you want these, and to guarantee a seat!)

Research Team

Sue Llewellyn, Professor at Alliance Manchester Business School

Christos Begkos, Lecturer in Accounting, AMBS

Sheila Ellwood, Professor of Financial Reporting, Bristol University

Naomi Chambers, Professor of Healthcare Management, AMBS

Abstract

The NHS is tax-funded, has a finite budget and faces increasing demand. Costing is essential to put resources to best use and avoid waste. For example, if a patient care procedure is as safe, less expensive and clinical outcomes are as good in community services, compared to a hospital; this is compelling evidence for community treatment. Patient level costs are most appropriate for such decisions. We investigated the use of the recently introduced, NHS patient level information and costing systems (PLICS) through a survey and four hospital case studies. The most significant PLICS use is hospitals reducing costs to meet financial targets whilst trying to maintain good care. Clinicians, generally, welcome having patient level costs to help decide how best to carry out care procedures, use theatre capacity, how many diagnostic tests to do, whether to treat patients as day cases or in hospital and how long they should stay. PLICS was rarely used to make resource allocation decisions involving collaboration between hospitals and community services, partly because 74% of hospitals consider their PLICS data commercially sensitive and only 5% share it with commissioners but also community services lack PLICS data. Hospitals tend to have separate data collection systems for clinical outcomes and cost, so, generally, PLICS could not be used to relate costs to clinical outcomes. Under the current regulatory regime, the NHS is subject to competitive forces but also pressures for collaboration, we conclude PLICS use is, primarily, to manage individual Trust financial performance in a competitive environment.

Further information about the PLICS project

About Sue Llewellyn

Professor Sue Llewellyn joined Alliance Manchester Business School in 2007, having previously held Chairs at the Universities of Leicester and Edinburgh. Visiting posts have been at: Queens University, Kingston, Canada; the University of Adelaide, Australia; the University of Linköping, Sweden; The University of Macquarrie, Australia; the University of Ferrara, Italy; the University of Otago and the University of Wellington, New Zealand; and Auckland University of Technology, New Zealand. Her work is mainly qualitative in nature; research interests lie in: public sector management, particularly in the professional-managerial interface in health; costing and budgeting as organizational practices; management control; accountability and responsibility; organizational agents and agency; and research methodologies.

About Christos Begkos

Dr Christos Begkos joined Alliance Manchester Business School as a Lecturer in Management Accounting in 2015. Previous to this, he worked as a Research Associate, after studying for his PhD at the Business School. He obtained an MSc in Economics & Finance from the University of Warwick, and a BSc in Business Administration from the University of Macedonia. His research interests are in the areas of management accounting, public sector accountability, healthcare costing, strategy and mixed-methods research.

About Sheila Ellwood

Professor Sheila Ellwood currently holds a Chair in Financial Reporting at Bristol University. Her research examines how managerial freedoms created through the trend to decentralise public service organisations are required to be tempered through ‘better’ accounting. Her research impacts on both national policy and local financial management, specifically on: financial reporting policy in the public sector; the policy on audit of local public bodies and in the costing/ pricing of healthcare. Her work has led to appointments as a Non Executive Director (2000-2005) and a Treasury Panel member (2009-11) and from July 2015. Her REF case: ‘Enhancing financial management and accountability in market-orientated public services in England’ was highly rated. She is Deputy Editor of Public Money & Management.

About Naomi Chambers

Naomi Chambers is professor of healthcare management at Alliance Manchester Business School (AMBS) at the University of Manchester. Her wide range of teaching, advisory and research interests include health care commissioning, board governance and effectiveness in the public and charitable sectors, leadership development in the NHS, health policy and management in Europe, primary care, emergency planning, ehealth and clinical costing. Naomi has previously been director of executive education at AMBS (2006/7), head of the health management group at AMBS (2008-2013) and President of the European Health Management Association (2007-2010).

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