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One of the most important questions asked of the NHS is whether it delivers value for money. The National Audit Office, which scrutinises public spending on behalf of Parliament, defines value for money as “using resources optimally to achieve intended outcomes” and measures it by how far public bodies have been able to spend less, spend well and spend wisely. Economists traditionally define value in more technical terms, but the focus is, as above, on what is gained relative to what is given up.
For the NHS, value for money considerations tend to focus on demonstrating that services are delivered to a sufficient standard with the funding made available. Yet, if value for money is a concept concerned with delivering what is ‘optimal’, and with what we gain relative to what we give up, in theory the standards set should link to the funding allocated.
Standards and value for money
While it may appear obvious in theory, this notion presents a challenge for the NHS and other public services. It suggests that a drop in standards may be reasonable, and still represent good value for money for the tax-payer, in the context of reductions in funding.
In practice, public (and staff) expectations make proposals to lower standards in order to optimise overall value near impossible to consider, and while the NHS has seen its finances under greater pressures since 2010, there has been little suggestion that quality should reduce as a result.
Instead, NHS organisations are expected to deliver the same or better services with fewer resources by improving efficiency and reducing waste. Department of Health/IPSOS Mori public polling indicates a growing belief that the NHS is delivering value for money, with almost three quarters of people now thinking this is the case.
However, the same polling also shows only 40 per cent of people think it possible to increase quality while reducing costs, which is exactly what the NHS has needed to do.
Balancing both objectives
Of course, there is nothing wrong with the public expecting continually improving services and the values underpinning the NHS mean staff will always strive to deliver better care. The consequence though of turning up the financial pressure without releasing it on the quality side means a heavier burden on NHS decision‑makers that need to balance both.
The NHS Confederation has been keen to highlight the link between quality and finance in the NHS and demonstrate how our members need to balance the two to ensure sustainability. There are some decisions in the NHS that only impact on finances and some that only impact on quality, but most impact on both. A good example is setting staff levels, which if set too high could generate a waste of resources or if set too low could compromise quality. To optimise resources and maximise quality, a decision has to be made that gets this balance right and the more you consider the factors involved, the more you realise just how tough a decision like this can be.
Decisions of value
We, along with the Academy of Medical Royal Colleges, spent the last year studying these types of decisions and exploring with NHS decision-makers what factors affect their ability to do this rationally. Our project is called “Decisions of Value” and we have uncovered really useful insight into the ways in which the NHS can deliver value for money.
Unsurprisingly, we found that while the system can often rely on rules and standards to ensure good decision‑making, the most important factors relate to cultures and behaviours.
One significant factor we found was the relationship between finance staff and clinical colleagues, who traditionally have a lead role in ensuring either financial balance or service quality. It is becoming increasingly obvious that a close rapport between those most responsible for delivering care and those most involved in paying for it is essential for delivering value. The savings now required of the NHS demand that clinical staff be more involved in decisions about how resources are distributed.
Despite this, in a survey we conducted with NHS staff nearly three quarters of the clinicians responded felt they were rarely or never involved in financial decisions affecting their whole organisation, and more than half of those on the front-line did not feel involved in financial decisions affecting their service or team.
Service providers and users
Relationships between the service provider and the service user appears also to be crucial. This is not just with regards to clinical decisions, but also in terms of involving patients in the decisions organisations make about how they run or improve their services. The patients we spoke to were adamant they could add benefit to the process of putting resources in the right places, if they were given greater opportunity to do so. In truth, there are many ways in which this happens across the NHS, from use of complaints and other feedback through the public consultation, but the influence of these tools is often not communicated well to patients.
Other themes uncovered in our research were the importance of deeper values‑based behaviour and the need for more information‑driven decision-making, increasingly supportive environments and larger networks of peer support. Together, they illustrate good principles for decision‑making but the scope for them to become the norm in the NHS is dependent on continuing the culture change demanded by the Francis Report, published more than two years ago.
Reference has been made to the impact of this report, the so-called “Francis effect”, and nothing we heard in our research calls this into question. The NHS is certainly mindful of the lessons expressed by Sir Robert Francis QC and people working in the service are determined to demonstrate their motivation to deliver the highest quality of care possible, now and for the future. Yet, most did not need a report to elicit this response and many organisations were working on shifting culture before its recommendations were published.
Culture change cannot be forced, it needs to be nurtured to help people understand each other better. Our research shows how intricate decisions in the NHS can be and how far good decision-making relies on the space afforded to staff to rationally consider all factors. Evidence shows the impact external factors have on their ability to do this and how far they inhibit decision-making, so that it falls back on the old ways of doing things. Standards have their place in the NHS and they need to offer a basis for staff to be confident in the quality of the care they deliver.
Real value though is unlocked by people driven by continuous improvement, motivated by the values and relationships that lie at the heart of what makes the NHS truly world class.
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