Whenever people talk about "red tape" I always wonder whether it is just an excuse for their own inadequacies: "we could not achieve the required outcomes because all of the red tape held us back". Not that I am justifying excessive bureaucracy, I am just questioning whether in some cases "red tape" is not the problem. So here's a suggestion to find out if this is the case.
I suggest that a website should be set up so that every time a public employee thinks that red tape is hindering their delivery of a service, they can go to the website and identify the regulation that is hindering them and give sufficient details to "explain" why they disapprove of it. There would be a committee (or probably, several committees) to go through each month's results and if the committee decides that the regulation is more of a hindrance than a benefit they will put a recommendation to Parliament to change the law. If the committee decide that there is a more important reason for the regulation they should contact the original complainant and explain the decision.
This way we can solve two issues: firstly we can (albeit slowly) remove unnecessary regulation and secondly educate the public why necessary regulation exists.
The only problem with this suggestion is the bureaucracy involved in doing all of this.
Monday, 27 August 2012
Thursday, 23 August 2012
A bankrupt policy
"As mentioned above the business model of the Group is such that the existing operations of the Group will not generate positive cash flows in the short to medium term. In such circumstances the Group is therefore reliant upon debt and/or equity funding to maintain its current operations. In terms of debt funding market conditions are very difficult and therefore equity funding is crucial to the Group. It follows that if the Resolutions are not passed by the Shareholders the Placing and the Subscription will not proceed and in these circumstances the Directors believe it would be likely that the Group would not be able to trade as a going concern which would be likely to result in the insolvency of all or part of the Group and such an outcome would, in the Board’s opinion, result in Shareholders receiving little or no value for their current shareholdings."This is a section from the begging letter that Circle issued to its shareholders in May this year, asking for £46m. It clearly states that they are on their uppers, and that without this money the company would go bankrupt and not only that, but their assets are so few the shareholders will get no return on their previous investment. This is a company that cannot make a profit and handles its money so badly that it has no assets to speak of.
So what does the Department of Health do? It hands them NHS hospitals. First the DH hands them Hinchingbrooke, then Circle are sniffing over George Eliot, and now the Department of Health are asking Circle if they would be interested in South London Healthcare Trust.
A bankrupt company running a bankrupt hospital; a bankrupt policy.
Monday, 20 August 2012
Repetition
Ali Parsa, the chief executive of Circle, has an annoying habit of repeating a statement without explaining the evidence behind the statement. This is a common PR technique: by repeating a statement people believe that it is true, and by not explaining the evidence, listeners (particularly journalists) deduce and extrapolate their own "evidence": it becomes true because journalists make it true.
Nations Healthcare was one of the first companies to be contracted to run an Independent Sector Treatment centre (ISTC) the New Labour government's mechanism to privatise some NHS services. The company was created in 2002 and has its origins in the US. Nations Healthcare was contracted to open its ISTC in Nottingham in December 2007, but it missed this deadline and the facility opened in July 2008, by this time Nations Healthcare had been taken over by Circle. Thus, the Nottingham NHS Treatment Centre should be regarded as always being a Circle facility because it was not opened until after Circle took over Nations.
The IPA management consultancy group have produced a case study of Circle (Sept 2011). In this they say:
Even though the "evidence" is provided by Circle (it would be more believable if they used an independent organisation), this is only one year of productivity gain. The website for the Nottingham NHS Treatment Centre says this:
Nations Healthcare was one of the first companies to be contracted to run an Independent Sector Treatment centre (ISTC) the New Labour government's mechanism to privatise some NHS services. The company was created in 2002 and has its origins in the US. Nations Healthcare was contracted to open its ISTC in Nottingham in December 2007, but it missed this deadline and the facility opened in July 2008, by this time Nations Healthcare had been taken over by Circle. Thus, the Nottingham NHS Treatment Centre should be regarded as always being a Circle facility because it was not opened until after Circle took over Nations.
The IPA management consultancy group have produced a case study of Circle (Sept 2011). In this they say:
"Circle has only been delivering services at the Midlands Centre for three years, Nottingham for two years, and Bath for less than a year, so data on long-term productivity trends is limited. However, evidence gathered by the company shows that in 2009, Nottingham had a 22 per cent productivity gain, and the Midlands centre had a 17 per cent productivity gain. Data is not yet available for Bath.
At the Midlands Centre the employees have been engaged in a turnaround operation, after a period of low performance under the previous owner, which has set a clear direction."This says that the two facilities (Nottingham and the Midlands Centre in Burton) had poor productivity in 2008 and in 2009 there were similar productivity gains (of about 20%). The study lays the blame for the poor productivity of the Midlands Centre on Nations Healthcare. However, 2009 is two years after Circle took over Nations (ie they had been running the facilities for 2008 and 2009) and in the case of the Nottingham ISTC, Nations had never run the facility, so the 22% productivity gain in 2009 was an improvement on the poor running of the centre by Circle in 2008. It seems quite a coincidence that Circle (who ran the Nottingham ISTC badly in 2008) would also take over another facility that was also run badly, and that both facilities improved by a similar amount in 2009. It would be reasonable to conclude that Circle ran both facilities badly in 2008.
Even though the "evidence" is provided by Circle (it would be more believable if they used an independent organisation), this is only one year of productivity gain. The website for the Nottingham NHS Treatment Centre says this:
"This was achieved at the same time as staff redesigned patient pathways to deliver average productivity gains of 18% each year since opening,"This year is 2012 and the facility has been open for 4 years. Is what they are saying seriously possible? Is it possible to increase productivity by 18% every year for four years? If that is the case, a procedure carried out now would cost 45% what it cost in 2008. Or put it another way, for the same money they are performing 94% more procedures than they would in 2008. Is this possible, because if it is, they were either seriously under-performing in 2008, or Circle have found a magic productivity potion!
Much more likely is that this refers to just one year and the website has either not been updated, or it is deliberately trying to deceive us. Circle love to throw out "statistics" and if these are not challenged, however unbelievable they are, the "statistics" become true.
Sunday, 19 August 2012
Healthcare on a budget
My grandfather moved to Shanghai in 1928 to escape the rising unemployment and industrial unrest in Britain. Like most people at the time he had basic schooling, but he had taken evening classes to train as a plumber. This meant that he was slightly higher than most in the British class system because he was a tradesman. His passport says that his occupation was "plumber" and the contract for his job in Shanghai said that he was "foreman class".
The class system in Shanghai was more complicated than in Britain and was heavily influence by empire. Inevitably the Chinese were at the bottom, but the British were resolutely at the top. The city that the Britons knew as Shanghai was the International Settlement, and formally it was the amalgamation of the British Settlement and the American Concession granted by the Chinese after the Opium Wars (Shanghai also included the French Concession, which was separate to the International Settlement). Nominally, the International Settlement was run by 12 countries (the Shanghai Municipal Council flag had the flags of 12 countries: Great Britain, US, France, Germany, Russia, Denmark, Italy, Portugal, Norway and Sweden, Austria, Spain, and Holland), however, in practical terms, the city was run by British businessmen. Even the Americans recognised this, taking a subservient role to the British, and it was only after liberation by the Americans in 1945 that this changed, perhaps most symbolically by the change on the 31 December 1945 to make cars drive on the right, whereas up until then cars drove on the left, as was the case in Britain.
Within the British community there was a complex class system. For example, at my grandfather's company the senior staff were engineers and university educated, but significantly they were educated in Britain. The important point was that they had been employed from Britain. This was the case with my grandfather, he was skilled with evening classes qualifications, but because he applied to a job advertised in Britain and emigrated to Shanghai, he was regarded as being a rung on the class ladder above a similarly skilled European man who was employed locally.
Shanghai between the world wars was extreme capitalism, the city existed to make money. There were no passport controls, so anyone could move there, and it was well known for gamblers and gangsters. There was also a large population of "white" Russians who emigrated there after the Russian revolution and there was a large Jewish population of stateless refugees who emigrated from Europe in the 30s after the rise of Nazism. However, if you had no employment, you did not eat and life was cheap. For example, during the Winter of 1938 one hundred thousand "exposed corpses" were removed from the streets of the International Settlement (up to 400 a day), these were the bodies of the homeless who had died in the extreme cold and some were the casualties of the 1937 war between the Chinese and Japanese.
The capitalism continued even during the war. In 1941 the Japanese occupied the International Settlement (they had occupied the much larger Chinese city surrounding the settlement since 1937). In 1943, fifteen months later, civilians from the countries at war with the Axis Powers were interned in prison of war camps. There were about 6,000 "British" (a term that included Australians, New Zealanders and South Africans as well as people from the United Kingdom). These were not people "sheltering" from the War, indeed, Shanghai had suffered terrorism (bombs and shootings between rival gangs and attacks from Nationalists and Communists) throughout the thirties. When the Second World War started many of the British (particularly the younger men) tried to join the British military, but were refused. Churchill, realising the importance of Chinese trade on the British exchequer, told the British firms in the city not to allow their employees to leave. This may seem to us, in a modern world where people change jobs frequently, to be an ineffectual decree , but before WWII this was an important statement. My grandfather's contract says specifically that the employee - my grandfather - could not break the contract. He could only leave the job if he was dismissed, retired or was "invalided out of service". No employer would employ someone who had broken their contract of employment with another employer. Indeed, when he was interned, my grandfather obtain a letter from his employer to state that he was no longer working for the company because of internment and not because he had broken the contract.
In the internment camp the Japanese provided little food and what food that turned up had a poor provenance. The internees had intermittent deliveries of Red Cross parcels. These were not provided by the Red Cross, the organisation was simply used to deliver the parcels and to ensure that they only contained permitted items. The parcels came from friends of the internees. The internees were given several weeks notice before they were interned and so they deposited some money with a friend who was not going to be interned (in my grandfather's case, it was a Rumanian employee at the company where he worked, someone who was described as "stateless"). The friend would then put together the parcel and when the Japanese authorities allowed it, the parcels were delivered to the camp by the Red Cross.
The internees were also allowed to buy food when it was available. The British government provided funds which were administered by the Swiss Consul. These funds were euphemistically called "comfort allowances", but were used to pay for basic necessities like food and clothing. My grandfather kept a notebook and it appears that the "comfort" payment he received was $18,000 per month. Inflation was rampant in the camp, so on the 23 November 1944 six eggs cost $192, eight months later, on the 23 July 1945, the same number of eggs cost $3000. It is important top note that these "comfort" payments were loans. The civilian internees clearly had no employment, but were expected to pay for their time in the internment camp, and when they were finally liberated after two and a half years, each one was handed a bill from the British government. My grandfather returned back to work after liberation, and after a couple of months of negotiation, his employer agreed to pay his bill for his "comfort" payments while he was interned.
My father was born in Shanghai in 1932. When the war started my grandfather tried to persuade my grandmother to move with my father to Australia, but she refused to go because my grandfather could not leave his job. So my family, my grandparents and my father, were interned by the Japanese authorities. In early 1945, after two years in the camp, my father fell seriously ill. He had a tumour on his elbow. He was treated as much as was possible in the camp hospital, and also made trips to Shanghai to have x-rays in one of the hospitals there.
My grandfather's notebook lists him getting sicker. On the 12th of April it says that my father's arm was in a sling and on the 18th he had aspirin. On the 2nd my father had an x-ray and his arm was put in plaster (this must have been in a Shanghai hospital), and he was admitted to hospital on the 3rd (possibly the camp hospital). On the 28th of May the entry reads that my father is "sick". On June 27th and July the 4th he had more x-rays, and was admitted to hospital (possibly the camp hospital?) on the 6th of July. On August 8th he was admitted to hospital in Shanghai and on the 9th and 10th he was x-rayed again. On the 19th my grandfather notes that he "spoke to Dr Byson" and then on the 20th he writes a letter to my father in St Lukes Hospital Shanghai (I have the letter). My father appears to have returned to the camp by the end of the month, and then within a couple of weeks he was sent on a hospital ship back to England.
The class system in Shanghai was more complicated than in Britain and was heavily influence by empire. Inevitably the Chinese were at the bottom, but the British were resolutely at the top. The city that the Britons knew as Shanghai was the International Settlement, and formally it was the amalgamation of the British Settlement and the American Concession granted by the Chinese after the Opium Wars (Shanghai also included the French Concession, which was separate to the International Settlement). Nominally, the International Settlement was run by 12 countries (the Shanghai Municipal Council flag had the flags of 12 countries: Great Britain, US, France, Germany, Russia, Denmark, Italy, Portugal, Norway and Sweden, Austria, Spain, and Holland), however, in practical terms, the city was run by British businessmen. Even the Americans recognised this, taking a subservient role to the British, and it was only after liberation by the Americans in 1945 that this changed, perhaps most symbolically by the change on the 31 December 1945 to make cars drive on the right, whereas up until then cars drove on the left, as was the case in Britain.
Within the British community there was a complex class system. For example, at my grandfather's company the senior staff were engineers and university educated, but significantly they were educated in Britain. The important point was that they had been employed from Britain. This was the case with my grandfather, he was skilled with evening classes qualifications, but because he applied to a job advertised in Britain and emigrated to Shanghai, he was regarded as being a rung on the class ladder above a similarly skilled European man who was employed locally.
Shanghai between the world wars was extreme capitalism, the city existed to make money. There were no passport controls, so anyone could move there, and it was well known for gamblers and gangsters. There was also a large population of "white" Russians who emigrated there after the Russian revolution and there was a large Jewish population of stateless refugees who emigrated from Europe in the 30s after the rise of Nazism. However, if you had no employment, you did not eat and life was cheap. For example, during the Winter of 1938 one hundred thousand "exposed corpses" were removed from the streets of the International Settlement (up to 400 a day), these were the bodies of the homeless who had died in the extreme cold and some were the casualties of the 1937 war between the Chinese and Japanese.
The capitalism continued even during the war. In 1941 the Japanese occupied the International Settlement (they had occupied the much larger Chinese city surrounding the settlement since 1937). In 1943, fifteen months later, civilians from the countries at war with the Axis Powers were interned in prison of war camps. There were about 6,000 "British" (a term that included Australians, New Zealanders and South Africans as well as people from the United Kingdom). These were not people "sheltering" from the War, indeed, Shanghai had suffered terrorism (bombs and shootings between rival gangs and attacks from Nationalists and Communists) throughout the thirties. When the Second World War started many of the British (particularly the younger men) tried to join the British military, but were refused. Churchill, realising the importance of Chinese trade on the British exchequer, told the British firms in the city not to allow their employees to leave. This may seem to us, in a modern world where people change jobs frequently, to be an ineffectual decree , but before WWII this was an important statement. My grandfather's contract says specifically that the employee - my grandfather - could not break the contract. He could only leave the job if he was dismissed, retired or was "invalided out of service". No employer would employ someone who had broken their contract of employment with another employer. Indeed, when he was interned, my grandfather obtain a letter from his employer to state that he was no longer working for the company because of internment and not because he had broken the contract.
In the internment camp the Japanese provided little food and what food that turned up had a poor provenance. The internees had intermittent deliveries of Red Cross parcels. These were not provided by the Red Cross, the organisation was simply used to deliver the parcels and to ensure that they only contained permitted items. The parcels came from friends of the internees. The internees were given several weeks notice before they were interned and so they deposited some money with a friend who was not going to be interned (in my grandfather's case, it was a Rumanian employee at the company where he worked, someone who was described as "stateless"). The friend would then put together the parcel and when the Japanese authorities allowed it, the parcels were delivered to the camp by the Red Cross.
The internees were also allowed to buy food when it was available. The British government provided funds which were administered by the Swiss Consul. These funds were euphemistically called "comfort allowances", but were used to pay for basic necessities like food and clothing. My grandfather kept a notebook and it appears that the "comfort" payment he received was $18,000 per month. Inflation was rampant in the camp, so on the 23 November 1944 six eggs cost $192, eight months later, on the 23 July 1945, the same number of eggs cost $3000. It is important top note that these "comfort" payments were loans. The civilian internees clearly had no employment, but were expected to pay for their time in the internment camp, and when they were finally liberated after two and a half years, each one was handed a bill from the British government. My grandfather returned back to work after liberation, and after a couple of months of negotiation, his employer agreed to pay his bill for his "comfort" payments while he was interned.
My father was born in Shanghai in 1932. When the war started my grandfather tried to persuade my grandmother to move with my father to Australia, but she refused to go because my grandfather could not leave his job. So my family, my grandparents and my father, were interned by the Japanese authorities. In early 1945, after two years in the camp, my father fell seriously ill. He had a tumour on his elbow. He was treated as much as was possible in the camp hospital, and also made trips to Shanghai to have x-rays in one of the hospitals there.
My grandfather's notebook lists him getting sicker. On the 12th of April it says that my father's arm was in a sling and on the 18th he had aspirin. On the 2nd my father had an x-ray and his arm was put in plaster (this must have been in a Shanghai hospital), and he was admitted to hospital on the 3rd (possibly the camp hospital). On the 28th of May the entry reads that my father is "sick". On June 27th and July the 4th he had more x-rays, and was admitted to hospital (possibly the camp hospital?) on the 6th of July. On August 8th he was admitted to hospital in Shanghai and on the 9th and 10th he was x-rayed again. On the 19th my grandfather notes that he "spoke to Dr Byson" and then on the 20th he writes a letter to my father in St Lukes Hospital Shanghai (I have the letter). My father appears to have returned to the camp by the end of the month, and then within a couple of weeks he was sent on a hospital ship back to England.
In my grandfather's notebook there are also notes of the hospital costs. The cost for my father's hospital care for the month of May 1945 was $11,300 (in comparison, the following week gave the cost of one egg at $410), for June it was $14,500 (80% of the monthly "comfort" allowance) and in August it was $200,000. The last payment would presumably cover the cost of the two x-rays and the time my father stayed in St Lukes Hospital. Most poignant was the entry on the 28th August 1945. My father was in great pain and someone in the camp had made a brace to support his arm. This cost two and a quarter million Shanghai dollars. (Unfortunately, I cannot find a comparison figure for eggs, but the hospital bill for August of $200,000 was noted in the following week.) I assume that there must have been a separate loan for this, but there is no paperwork to indicate this.
Reading through this I cannot help but wonder how these medical costs can be managed on a small, fixed budget that has to cover basic needs like food and clothing. My grandfather managed it, but it must have been a strain. I know that my grandfather suffered mental ill health a year later, but this was when my father and grandmother were in England and their letters say that they are unsure that the doctors in England could save his arm (in the event, they did, although my father's arm was disabled for 40 years until eventually it was amputated when he was 51).
This is something that we do not experience now, since we are so used to getting high quality care, free at the point of delivery. Soon, however, when personal Health Budgets are introduced, we will be in the same situation my grandfather was in: a fixed monthly budget, and regardless of the vagaries of ill health, we will have to stick to our budgets or find some other funding source. Personal Health Budgets are a return to the 1940s and it is a Conservative government that will deliver it.
Friday, 17 August 2012
Budgeting
Imagine for a moment that you are in charge of rolling out a scheme where all the patients with long term conditions (LTCs) in the locality are given a budget to pay for their healthcare. How would you calculate how much to give each patient?
Few patients with an LTC will have a single condition, so you will need to calculate how much the treatment for each condition will cost. But even if two patients have the same, single condition, it is unlikely that their treatment will cost the same because one may be more severely affected than the other, or there may be some other factor involved, like age. Once you have a rough idea how you would calculate a budget, hold on to that idea and read on.
Calculating a personal budget is not simple. But it is happening right now for social care.
A week ago I talked to a social worker friend who was the manager who introduced personal social care budgets in her area. Initially she was enthusiastic about them because they offered a way to personalise care: the service users would have more choice about how the care was delivered and would be more involved in the decision-making. This was during the last government when there was money to pay for options like personalisation. Now my friend is scathing. Personal budgets are no longer a vehicle to personalise care. The reason is that for all of their benefits, personal budgets are not resilient to cuts, indeed, they may even make cuts easier to apply, and this results in service users getting worse care.
I asked my friend how the budgets were calculated. She said that each service user is assessed and their needs are collated. They used a points-based system where different needs accrued different numbers of points, and the more severe the need, the more points were allocated. For each service user, the points are summed and then converted to money to create the service user's direct payment.
I asked how this worked. She said "first we take the budget agreed this year by the local authority and top slice by 20%..." I stopped her there: "what's the 20% for?". he went on, "...that's for cuts. Then we divide the remaining budget by the total number of points for all service users and that gives us how much money each point is worth".
There are a couple of points to raise here. The first is that the process is equitable: each service user gets a share of the budget and their share is proportional to their needs. However, note the word proportional: the service user does not get the money they need, just a proportion. This leads us to the most important point. If personal budgets are to allow service users to personalise their care, they would be calculated on the cost of the service users' needs. A points system would not be necessary, since the social workers would simply aggregate the costs of the services the service user needed and that should be their budget. The fact that a points system is used is an acceptance that service user needs cannot be fully funded. Direct payments are dependent upon the budget allocated by politicians, with a lesser dependence on the service users' actual needs. Politicians determine personal budgets, not social workers.
If this is not bad enough, the meagre budget being allocated by local politicians is expected to be reduced by 20% every year. This is a reduction forced upon local authorities by central government in its deficit reduction plan. Personal social care budgets are being cut to reduce the deficit. Clearly the budgets do not cover the costs of the care the service user needs, so I asked the obvious question of where the rest of the money comes from. I got the obvious answer: the service users either pay the difference themselves, or ration their care. The sorts of optional care that were used to "sell" personal budgets to the public (like horse riding lessons for disabled kids) are no longer affordable. Personal budgets have been cut too much to fund them. Indeed, my friend told me that the cuts are biting so deep that personal budgets do not even cover basic needs. It is getting to the point where people are seriously calculating the maximum amount of time it is reasonable to allow someone to remain in a soiled incontinence pad.
The points-based system means that what little money is available is shared equitably, but it also makes it easer for the cuts to be made since removing an entire service would create a political storm.
Now imagine you are a manager allocating personal health budgets. You are in the same situation that social care is in at the moment: the budget, not the patients' needs, determines the direct payment you can make. Does this change how, at the top of the page, you thought that personal budgets would be allocated? I am completely against personal health budgets: they allow the government to make cuts to our healthcare, and as cuts get deeper ()as they will) personal health budgets will legitimise top-up payments by patients. No one voted for this at the last election.
Few patients with an LTC will have a single condition, so you will need to calculate how much the treatment for each condition will cost. But even if two patients have the same, single condition, it is unlikely that their treatment will cost the same because one may be more severely affected than the other, or there may be some other factor involved, like age. Once you have a rough idea how you would calculate a budget, hold on to that idea and read on.
Calculating a personal budget is not simple. But it is happening right now for social care.
A week ago I talked to a social worker friend who was the manager who introduced personal social care budgets in her area. Initially she was enthusiastic about them because they offered a way to personalise care: the service users would have more choice about how the care was delivered and would be more involved in the decision-making. This was during the last government when there was money to pay for options like personalisation. Now my friend is scathing. Personal budgets are no longer a vehicle to personalise care. The reason is that for all of their benefits, personal budgets are not resilient to cuts, indeed, they may even make cuts easier to apply, and this results in service users getting worse care.
I asked my friend how the budgets were calculated. She said that each service user is assessed and their needs are collated. They used a points-based system where different needs accrued different numbers of points, and the more severe the need, the more points were allocated. For each service user, the points are summed and then converted to money to create the service user's direct payment.
I asked how this worked. She said "first we take the budget agreed this year by the local authority and top slice by 20%..." I stopped her there: "what's the 20% for?". he went on, "...that's for cuts. Then we divide the remaining budget by the total number of points for all service users and that gives us how much money each point is worth".
There are a couple of points to raise here. The first is that the process is equitable: each service user gets a share of the budget and their share is proportional to their needs. However, note the word proportional: the service user does not get the money they need, just a proportion. This leads us to the most important point. If personal budgets are to allow service users to personalise their care, they would be calculated on the cost of the service users' needs. A points system would not be necessary, since the social workers would simply aggregate the costs of the services the service user needed and that should be their budget. The fact that a points system is used is an acceptance that service user needs cannot be fully funded. Direct payments are dependent upon the budget allocated by politicians, with a lesser dependence on the service users' actual needs. Politicians determine personal budgets, not social workers.
If this is not bad enough, the meagre budget being allocated by local politicians is expected to be reduced by 20% every year. This is a reduction forced upon local authorities by central government in its deficit reduction plan. Personal social care budgets are being cut to reduce the deficit. Clearly the budgets do not cover the costs of the care the service user needs, so I asked the obvious question of where the rest of the money comes from. I got the obvious answer: the service users either pay the difference themselves, or ration their care. The sorts of optional care that were used to "sell" personal budgets to the public (like horse riding lessons for disabled kids) are no longer affordable. Personal budgets have been cut too much to fund them. Indeed, my friend told me that the cuts are biting so deep that personal budgets do not even cover basic needs. It is getting to the point where people are seriously calculating the maximum amount of time it is reasonable to allow someone to remain in a soiled incontinence pad.
The points-based system means that what little money is available is shared equitably, but it also makes it easer for the cuts to be made since removing an entire service would create a political storm.
Now imagine you are a manager allocating personal health budgets. You are in the same situation that social care is in at the moment: the budget, not the patients' needs, determines the direct payment you can make. Does this change how, at the top of the page, you thought that personal budgets would be allocated? I am completely against personal health budgets: they allow the government to make cuts to our healthcare, and as cuts get deeper ()as they will) personal health budgets will legitimise top-up payments by patients. No one voted for this at the last election.
Saturday, 4 August 2012
Ranking
How do you rank one hospital trust against another?
It is not easy. For a start there are lots of general criteria you can use, like clinical quality, financial probity and patient experience. It is difficult to combine, say, a financial ranking with a clinical ranking: which is more important, and how do you weight them? Even within such a criteria, there are lots of sub-criteria. For example, in clinical quality you could include things like standardised mortality (HSMR), waiting times and hospital acquired infections (HAIs), but how do you combine them?
Dr Foster attempted to create a ranking in 2009. To do this they used 16 indicators, some of which were numeric values (like the HSMR) and others were logical (a question to which there is a yes or no answer). The numeric values had different scales, so some were percentages, others were whole numbers (for example, the number of HAIs). In some cases large numbers were "good", in other cases large numbers were "bad". All of this meant that Dr Foster had to manipulate these indicators before they could be combined. They scaled the numeric values so that all "good" values were -ve and the more negative the better, and all "bad" values were +ve and the larger were worse. (Their methodology says that high is "bad".) They also had to scale the values so that the highest for one indicator was as high as another indicator (for example a high HSMR may be 120, a high HAI rate maybe 10, so these two values would have to be scaled). Since outliers (exceptionally high or low values) will alter this scaling they had to be excluded and outlier trusts given the new maximum (or minimum) value. Dr Foster also had to find a way to turn a good "yes" and a bad "no" (and vice versa) into a number. There was a lot of manipulations of these indicators.
Even after converting all the indicators into numbers of approximately the same scale, it was still difficult to combine them because you have to determine how important one indicator is compared to another. For example, how important is the mortality rate compared to the HAI rate? So Dr Foster had to use some kind of weighting. The way they did this was through fuzzy logic using Bayesian ranking (look it up). With 16 different indicators, some of which can have a wide range of values, you would expect the final ranking to be unique, but the Dr Foster technique managed to give some hospital trusts the same value (and the same rank). In later years Dr Foster omitted to give the total "safety score" or the rank position, and instead chose to band trusts. This is a much better technique, but it prevents people from identifying the "best" trust, and so, although it is a fairer way to grade trusts, it is not a good way to get Press attention (who love rankings).
It is very difficult to combine different values to get a ranking. However Eoin Clarke has attempted to do this in a hamfisted way: he has produced his rank of the 143 Foundation Trusts according to their risk of "bankruptcy and dissolution". It is nonsense and I left a comment to explain why his methodology is nonsense although he's chosen not to publish the comment, so instead I will explain it here. Monitor uses a a finance rating of 1 to 5 and a red-amber-green (RAG) for governance. It uses two different scoring schemes precisely because it is difficult to compare finance and governance, yet Clarke does exactly that. He converts both the finance numeric, and governance RAG ratings, into scores between 0 to 10 and then adds them together. This means that he gives finance and governance equal weighting: does that make any sense? For example, breaching the 4 hour A&E target, or making more private income than the private patient income cap, are both regarded by Monitor as "breaches of authorisation" and will result in a lower governance rating. But are these breaches as bad as ending the year with a £50k deficit? Or ending the year with a £5m deficit? Apples and oranges. Clarke does not take into account the way that Monitor has created their ratings. For example, a trust could make a surplus and meet its cost improvement plan (CIP), but if it has a historical debt (regardless of how quickly it is paying off this debt) it cannot get a 5 finance rating.
One of the trusts that Clarke lists in his worst 30 trusts is a trust I know well. This trust generates a surplus every year and has done so since 2007. It meets its CIP every year. It is in the top 15 of trusts according to the Reference Cost Index (ie it is an efficient trust). But since this trust took out a DH loan in 2005, it cannot have a 5 finance rating and the maximum it can get is a 3 (which is has, and Clarke's scoring regards this as middling). The trust has also missed its 4 hour A&E target (not regularly, but once is enough) and hence the governance rating is not Green. Using Clarke's ranking this trust is in danger of bankruptcy and dissolution, but it is the strongest trust in its local health economy, and is nowhere close to bankruptcy.
Clarke's ranking is pretty much meaningless, so ignore it.
It is not easy. For a start there are lots of general criteria you can use, like clinical quality, financial probity and patient experience. It is difficult to combine, say, a financial ranking with a clinical ranking: which is more important, and how do you weight them? Even within such a criteria, there are lots of sub-criteria. For example, in clinical quality you could include things like standardised mortality (HSMR), waiting times and hospital acquired infections (HAIs), but how do you combine them?
Dr Foster attempted to create a ranking in 2009. To do this they used 16 indicators, some of which were numeric values (like the HSMR) and others were logical (a question to which there is a yes or no answer). The numeric values had different scales, so some were percentages, others were whole numbers (for example, the number of HAIs). In some cases large numbers were "good", in other cases large numbers were "bad". All of this meant that Dr Foster had to manipulate these indicators before they could be combined. They scaled the numeric values so that all "good" values were -ve and the more negative the better, and all "bad" values were +ve and the larger were worse. (Their methodology says that high is "bad".) They also had to scale the values so that the highest for one indicator was as high as another indicator (for example a high HSMR may be 120, a high HAI rate maybe 10, so these two values would have to be scaled). Since outliers (exceptionally high or low values) will alter this scaling they had to be excluded and outlier trusts given the new maximum (or minimum) value. Dr Foster also had to find a way to turn a good "yes" and a bad "no" (and vice versa) into a number. There was a lot of manipulations of these indicators.
Even after converting all the indicators into numbers of approximately the same scale, it was still difficult to combine them because you have to determine how important one indicator is compared to another. For example, how important is the mortality rate compared to the HAI rate? So Dr Foster had to use some kind of weighting. The way they did this was through fuzzy logic using Bayesian ranking (look it up). With 16 different indicators, some of which can have a wide range of values, you would expect the final ranking to be unique, but the Dr Foster technique managed to give some hospital trusts the same value (and the same rank). In later years Dr Foster omitted to give the total "safety score" or the rank position, and instead chose to band trusts. This is a much better technique, but it prevents people from identifying the "best" trust, and so, although it is a fairer way to grade trusts, it is not a good way to get Press attention (who love rankings).
It is very difficult to combine different values to get a ranking. However Eoin Clarke has attempted to do this in a hamfisted way: he has produced his rank of the 143 Foundation Trusts according to their risk of "bankruptcy and dissolution". It is nonsense and I left a comment to explain why his methodology is nonsense although he's chosen not to publish the comment, so instead I will explain it here. Monitor uses a a finance rating of 1 to 5 and a red-amber-green (RAG) for governance. It uses two different scoring schemes precisely because it is difficult to compare finance and governance, yet Clarke does exactly that. He converts both the finance numeric, and governance RAG ratings, into scores between 0 to 10 and then adds them together. This means that he gives finance and governance equal weighting: does that make any sense? For example, breaching the 4 hour A&E target, or making more private income than the private patient income cap, are both regarded by Monitor as "breaches of authorisation" and will result in a lower governance rating. But are these breaches as bad as ending the year with a £50k deficit? Or ending the year with a £5m deficit? Apples and oranges. Clarke does not take into account the way that Monitor has created their ratings. For example, a trust could make a surplus and meet its cost improvement plan (CIP), but if it has a historical debt (regardless of how quickly it is paying off this debt) it cannot get a 5 finance rating.
One of the trusts that Clarke lists in his worst 30 trusts is a trust I know well. This trust generates a surplus every year and has done so since 2007. It meets its CIP every year. It is in the top 15 of trusts according to the Reference Cost Index (ie it is an efficient trust). But since this trust took out a DH loan in 2005, it cannot have a 5 finance rating and the maximum it can get is a 3 (which is has, and Clarke's scoring regards this as middling). The trust has also missed its 4 hour A&E target (not regularly, but once is enough) and hence the governance rating is not Green. Using Clarke's ranking this trust is in danger of bankruptcy and dissolution, but it is the strongest trust in its local health economy, and is nowhere close to bankruptcy.
Clarke's ranking is pretty much meaningless, so ignore it.
Friday, 3 August 2012
Could this be the explanation?
Circle Health have been on a public relations offensive in the last few weeks, and this culminated in the appearance on the 1st August of their Chief Executive, Ali Parsa, on both Radio 4's Today programme, but also on BBC2's Newsnight.
On both programmes Parsa gave the same message, much of it plain wrong. He said that Hinchingbrooke will "have balanced books this year" when the first quarter's results showed that they made a £2.3m loss which was £652k more than they had planned. He then said that Germany spends the same as the UK on healthcare, and this is largely on private providers like his company, yet Parsa claimed that the German providers had greater patient satisfaction than the NHS. His claim was unsubstantiated and does not fit in with the facts: Germany spends much more (12% of a much larger GDP than our 10% of GDP) than the UK on healthcare and Germany report access to healthcare issues almost as worse as the US (and five times worse than the UK) and the Commonwealth Fund ranked Germany two places below the UK in patient satisfaction. Parsa topped-off his tirade with the Conservative accusation that GPs are private providers (which they are not for many reasons). The BBC (in the form of Justin Webb of Today and Kirsty Wark of Newsnight), left the worst claims of Parsa to go unchallenged, through ignorance rather than bias.
So why isn't Ali Parsa taking a long August vacation, why is he in the media at a time when most people are watching the Olympics? The reason may well be the following graph: the share price of Circle Holdings over the last 12 months (screen shot from Interactive Investor):
Over the last year the share price of Circle Holdings has fallen from around 200p a year ago (at the time of a large share offering and the listing of CIRC on the AIM stock market) to a value of about 80p now (it even fell as low as 44p for a few days).
This is not the graph of a company with a bright future: investors are showing their lack of confidence in the company. Mix into this the results from 2011 where Circle Holdings made a loss of £13.6m (EBITDA) and the announcement from the government that they will no longer pay Independent Sector Treatment Centres (ISTCs, like Circle's treatment centre in Nottingham, the only part of their business to make a profit) above the NHS rate (and hence this is a cut in payment of about 20%), and you have a company that should be panicking.
On the first of August Parsa was in firefighting mode. His media appearances were to reassure investors, to try and get the share price out of the slump it has been in for two months. The following graph shows the effect of Parsa's efforts:
He added 5p to the price (82.5p) before it fell back to 80p: the share price is still in a slump.
Parsa clearly has a lot more work to do to get the share price back up to its high of 200p, so expect a lot more media appearances in the next few months.
UPDATE:
In a piece on Open Democracy Richard Whittell of Corporate Watch says:
UPDATE2:
Further searches came up with the following from Reuters confirming Whittell's statement:
On both programmes Parsa gave the same message, much of it plain wrong. He said that Hinchingbrooke will "have balanced books this year" when the first quarter's results showed that they made a £2.3m loss which was £652k more than they had planned. He then said that Germany spends the same as the UK on healthcare, and this is largely on private providers like his company, yet Parsa claimed that the German providers had greater patient satisfaction than the NHS. His claim was unsubstantiated and does not fit in with the facts: Germany spends much more (12% of a much larger GDP than our 10% of GDP) than the UK on healthcare and Germany report access to healthcare issues almost as worse as the US (and five times worse than the UK) and the Commonwealth Fund ranked Germany two places below the UK in patient satisfaction. Parsa topped-off his tirade with the Conservative accusation that GPs are private providers (which they are not for many reasons). The BBC (in the form of Justin Webb of Today and Kirsty Wark of Newsnight), left the worst claims of Parsa to go unchallenged, through ignorance rather than bias.
So why isn't Ali Parsa taking a long August vacation, why is he in the media at a time when most people are watching the Olympics? The reason may well be the following graph: the share price of Circle Holdings over the last 12 months (screen shot from Interactive Investor):
This is not the graph of a company with a bright future: investors are showing their lack of confidence in the company. Mix into this the results from 2011 where Circle Holdings made a loss of £13.6m (EBITDA) and the announcement from the government that they will no longer pay Independent Sector Treatment Centres (ISTCs, like Circle's treatment centre in Nottingham, the only part of their business to make a profit) above the NHS rate (and hence this is a cut in payment of about 20%), and you have a company that should be panicking.
On the first of August Parsa was in firefighting mode. His media appearances were to reassure investors, to try and get the share price out of the slump it has been in for two months. The following graph shows the effect of Parsa's efforts:
He added 5p to the price (82.5p) before it fell back to 80p: the share price is still in a slump.
Parsa clearly has a lot more work to do to get the share price back up to its high of 200p, so expect a lot more media appearances in the next few months.
UPDATE:
In a piece on Open Democracy Richard Whittell of Corporate Watch says:
"Earlier this week [31 May] Circle Health went to investors to raise money, partly to help pay off £14 million it had borrowed from hedge fund James Caird Asset Management, at a staggering interest rate of 25 per cent."Could this be the reason for the sharp drop in Circle share price at the beginning of June?
UPDATE2:
Further searches came up with the following from Reuters confirming Whittell's statement:
Circle Holdings PLC Announces Cash Placing And Subscription To Raise GBP47.5 Million
Tuesday, 29 May 2012 02:04am EDT
Circle Holdings PLC announced that it intends to raise GBP46 million (net of expenses) by way of a placing of 65,714,286 Placing Shares and a subscription of 2,142,857 Subscription Shares at a price of 70 pence per New Ordinary Share with institutional investors. The Placing and the Subscription are conditional, inter alia, upon Shareholder consent. The Company has received Irrevocable Undertakings to vote in favour of the Resolutions from Shareholders representing in excess of 75% of the Existing Issued Share Capital. The Group intends to use the proceeds of the Placing and the Subscription as follows; repay in full the outstanding GBP14.1 million loan from JCAM which will mature in February 2013 and is subject to interest at the rate of 25% per annum; meet its current working capital requirements at CircleBath and Hinchingbrooke; complete the commissioning of CircleReading and its subsequent operating cash flow requirements; continue to support the Group's central operations; and provide working capital to implement the Group's strategy of bidding to take over the management of further NHS Trusts as and when they are put out to tender. Application will be made to the London Stock Exchange for the New Ordinary Shares to be admitted to trading on AIM. It is expected that Admission will become effective on June 19, 2012, and that dealings in the New Ordinary Shares will commence at 8.00 a.m. on June 19, 2012.
Wednesday, 1 August 2012
Footpaths Across the Grass
Unfortunately I cannot find it, but a few years ago I read an article about a local council who were annoyed that people ignored the "Keep Off the Grass" signs in one of their parks. The council looked at what people were doing and found that the people who walked on the grass were simply cutting off a corner when walking from one part of the park to another. The existing paths were to parts of the park where people did not want to go. So the council simply created a path where people wanted to walk. This solution meant that the grass was not walked upon and there were no unsightly bare-earth paths.
This is an important lesson. If you make rules that no one wants to follow you should not be surprised when no one follows them. Equally so, you should not be surprised that it costs you so much trying to make people follow those rules (like employing extra park keepers to shout "Oi! Keep off the grass!")
This story came to mind yesterday at a meeting at my local CCG where a member of the committee I was on asked why a cancer patient was not getting treatment and who was it that would take up the patient's case to ensure that the treatment was delivered. That question was followed by a lengthy discussion from officials about how the complaints and advocacy system should work and how it should work in the future with Local Healthwatch. They gave no reason why this system didn't work for this patient, and although they didn't say it, I got the impression that they felt the patient was at fault for not using the system the way it was designed to be used.
The problem is that the system is not working for this patient because the various providers (the GP and the local acute hospital) and the local PALS service are not working how they should be. The concern is that the new structures will not work how they are supposed to work, and this is more to do with the system not being designed around how the organisations actually work and how patients use them. It would be far better to observe how these organisations communicate and to improve that, rather than changing completely how they work together.
(My opinion is that GPs should be empowered to act as advocates in such a situation and have the responsibility for ensuring that the care is delivered. GPs are patients first point of contact with the NHS.)
Put the path where people want to walk rather than telling people to walk where they don't want to go.
This is an important lesson. If you make rules that no one wants to follow you should not be surprised when no one follows them. Equally so, you should not be surprised that it costs you so much trying to make people follow those rules (like employing extra park keepers to shout "Oi! Keep off the grass!")
This story came to mind yesterday at a meeting at my local CCG where a member of the committee I was on asked why a cancer patient was not getting treatment and who was it that would take up the patient's case to ensure that the treatment was delivered. That question was followed by a lengthy discussion from officials about how the complaints and advocacy system should work and how it should work in the future with Local Healthwatch. They gave no reason why this system didn't work for this patient, and although they didn't say it, I got the impression that they felt the patient was at fault for not using the system the way it was designed to be used.
The problem is that the system is not working for this patient because the various providers (the GP and the local acute hospital) and the local PALS service are not working how they should be. The concern is that the new structures will not work how they are supposed to work, and this is more to do with the system not being designed around how the organisations actually work and how patients use them. It would be far better to observe how these organisations communicate and to improve that, rather than changing completely how they work together.
(My opinion is that GPs should be empowered to act as advocates in such a situation and have the responsibility for ensuring that the care is delivered. GPs are patients first point of contact with the NHS.)
Put the path where people want to walk rather than telling people to walk where they don't want to go.
Hinchingbrooke double fail
The Hinchingbrooke Health Care NHS Trust Chief Executive's & Franchise Representative's Report (franchise representative represents Circle) has the following quote:
However, a rate of £1,250/3 per hour is pretty steep*, and you would expect that when you pay someone this large amount of money the recipient would come up with something more enthusiastic than "you are at the frontier of the way healthcare is going to be provided in the future". For that amount of money (£1,250/3 = £420 per hour) I would expect "get your asses down here right now, this place is brilliant!"
So not only is Hinchingbrooke duping the public, they are not getting value for money, either. Double fail.
[* oops arithmetic error corrected as per comments]
Mark Simmonds MP for Boston and Skegness visited the trust on 6 July and was able to attend a meeting about the positive changes that have been implemented in our Emergency Department this week. He had this to say: "In this hospital you can change the way the NHS works, in my view for the better, you are at the frontier of the way healthcare is going to be provided in the future. I hope patients and the local community recognise the positive changes that have been made and provide sufficient support and recommend it to their family and friends."Hinchingbrooke is in Cambridgeshire, Boston and Skegness is in Lincolnshire, so this is not a quote from a local MP. One has to wonder why Hinchingbrooke is inviting seemingly random MPs to inspect their hospital. Do you think his invitation has to do with Simmonds' Register of Members Financial Interest:
Strategic adviser to Circle Healthcare (social enterprise), 42 Welbeck Street, London W1.Simmonds was reluctant to declare that he was paid £12,000 a quarter (£50,000 a year) by Circle, and earlier this year had to apologise to parliament for deceiving them like this. Can someone explain to me why Hinchingbrooke, who are franchised to Circle, are quoting an MP who is paid by Circle? This is hardly an independent view, the public are being fed a biassed statement.
March 2011, £12,500 quarterly fee received. Hours: 10 hrs per month. (Registered 3 May 2011)
June 2011, £12,500 quarterly fee received. Hours: 10 hrs per month.
Late entry to which the rectification procedure was applied on 6 March 2012. See paragraph 108 of the Guide to the Rules.
(Registered 3 October 2011)
However, a rate of £1,250/3 per hour is pretty steep*, and you would expect that when you pay someone this large amount of money the recipient would come up with something more enthusiastic than "you are at the frontier of the way healthcare is going to be provided in the future". For that amount of money (£1,250/3 = £420 per hour) I would expect "get your asses down here right now, this place is brilliant!"
So not only is Hinchingbrooke duping the public, they are not getting value for money, either. Double fail.
[* oops arithmetic error corrected as per comments]
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