As we know, the NHS is in constant flux and often used as a key campaign topic by political parties. With the snap general election and the process of Brexit being worked through, the NHS can expect to face further change as it balances growing clinical demand, rising costs, a retiring workforce and finite budgets.
At Triducive, we regularly work in partnership with a large group of NHS managers and budget holders and the resounding feedback is that change is needed. The role of CCGs is being questioned and the STP approach, whilst necessary, is facing fierce scrutiny.
The changing customer base for med-tech, biotech and pharmaceutical clients creates both challenges and new opportunities. To maximise these, preparation is paramount.
Whatever the terminology used and the framework decided for both commissioning and delivering healthcare, accountability and affordability will remain important.
As referenced by NHS England in Next steps On The NHS Five Year Forward View1:
1 The quality of NHS care is demonstrably improving, but we’re becoming far more transparent about care gaps and mistakes.1
2 Staff numbers are up, but staff are under greater pressure.1
3 The public are highly satisfied with the NHS, but concerned for its future.1
4 There is now an underlying consensus about how care needs to change to ‘future proof’ the NHS, but the ability to do so risks being overtaken by what CQC has called today’s ‘burning platform’.1, 2
Whilst the detail is emerging slowly, the direction of travel being pursued by the NHS is pretty clear, and it follows some pioneering work across the globe.
This paper brings together Triducive’s learnings from our experience working with Accountable Care models across Europe, and relates this to the emerging Accountable Care Organisations in the UK – which many of our NHS colleagues anticipate to become a key constituent of our NHS.
What is an ACO?
• An ACO is a group of organisations that are given a budget with the fixed objective of delivering specific outcomes for a specific population’s health needs.
• It is essentially a partnership between primary, acute, community, social care and third sector providers who have agreed to take responsibility for providing all care for a given population for a defined (and long) period of time.
• ACOs take many different forms ranging from fully integrated systems to looser alliances and networks.
Where did the ACO concept originate?
• Accountable Care Organisations (ACOs) were introduced in the US as part of the Affordable Care Act in 2010 (better known as Obamacare).3
• Whilst the term Accountable Care was coined in the US, similar models have been rolled out across European health systems for over a decade.
• International experience of ‘accountable care provision’ was mentioned in the Five Year Forward View (October 2014) in relation to the NHS’s new models of care, including Primary and Acute Care Systems and Multispecialty Community Providers.4
• An Accountable Care System (ACS) was defined in Next steps on the NHS Five Year Forward View (March 2017)1 as “an ‘evolved’ version of an STP that is working as a locally integrated health system…in time some ACSs may lead to the establishment of an ACO. This is where the commissioners in that area have a contract with a single organisation for the great majority of health and care services and for population health in the area”.1
Why do we need ACOs?
• The development of ACOs is a response to growing financial and service pressures and has attracted interest as one way of overcoming fragmented responsibility for the commissioning and provision of care in the NHS.
• The goal is to bring providers together to provide more joined up, better coordinated care. This aspiration is important as there is still a provider/commissioner split and perverse incentives (such as gain sharing) operate in the current NHS.
How will the success of ACOs be measured?
• Providers will be held accountable by NHSE for achieving a set of pre-agreed quality outcomes within a given budget or expenditure target.
• Providers will be incentivised to keep people well, rather than help people get better. The focus is on prevention.
• This would replace the system of payment according to the number of patients seen or treated i.e. ‘payment by results’.
• Incentives include:
- Keeping people as healthy as possible (so they reduce the need for using health services).
- Minimising the need for hospital-based care provisions by having more community-based services available to patients.
- Reducing unplanned hospital admissions.
How will ACOs change NHS commissioning?
• For ACOs to work, commissioning itself needs to be integrated and strategic to facilitate the development and implementation of integrated models of care.
• Commissioners need to focus on defining and measuring outcomes, putting in place budgets covering the whole of a population’s care, and using long-term contracts with providers linked to the delivery of these outcomes.
• How the introduction of ACOs will affect CCGs is unknown at present.
• ACOs will require NHS commissioners to work together across larger areas than those typically covered by CCGs today, and will involve pooling budgets with local authorities.
• ACOs could be either an alternative or partner to CCGs. This could lead to a reduction in the number of CCGs, with the potential for replacing them with regional financial controllers/commissioners that will monitor the performance of ACOs against their contracts.
Which areas are doing it?
• In Q1 2017/18, NHS England and NHS Improvement will jointly run a light-touch process to encourage STPs to come forward as potential Accountable Care Systems.
• Likely candidates include: Frimley Health; Greater Manchester; South Yorkshire & Bassetlaw; Northumberland; Nottinghamshire, with an early focus on Greater Nottingham and the southern part of the STP; Blackpool & Fylde Coast, with the potential to spread to other parts of the Lancashire and South Cumbria STP at a later stage; Dorset; Luton, with Milton Keynes and Bedfordshire; West Berkshire. This list will no doubt change over time.
What can we learn from ACO models across Europe and the US?
Whilst all ACOs are structured differently, Triducive’s work across Europe gives us practical insight into what has historically worked in other countries.
Understanding what works and applying those learnings to support our clients and partners to maximise opportunities is part of what we do.
• Those doing it for longer saw higher financial gain – Gesundes Kinzigtal, an ACO in the south of Germany has been going for nearly 12 years. Their experience has found that it takes time to actually translate incentives and investment into change, with initial gains being small.
• Capture data and analyse it effectively – Our experience of working with ACO models across Europe and the US, highlights the need for both capturing and effectively analysing data. Whilst national data about financial performance and quality indicators are published, where the NHS currently fails is its lack of investment in data intelligence and analytics. European systems such as OptiMedis and Ribera Salud tower over UK systems.
• Capturing organisational insights helps to drive change – Many successful global models have captured organisational (local) insight data as well as national data. With demand amongst most NHS England teams being mainly for data on national dashboards, capturing organisational insights that will help drive change and innovation, must not be overlooked.
• Changing behaviour is the real challenge – Financials and data aside, ACO models across the globe all show that the real challenge – like with all healthcare transformations – is changing the behaviour of people (management, clinical staff and patients). This is often the hardest and last element to change.
What are the opportunities for Pharma?
Pharmaceutical companies have a critical and unique role to play in ACOs, where the value-based environment will call for a greater emphasis on pharmaceutical management. However, the changes required by ACOs will go ‘beyond the pill’.
Below are 10 top tips to maximise the opportunities that ACOs bring.
10 Top Tips
Communicate a simple and coherent message – Understand the needs of the new customer base and what is important to them. Communication should not solely be about being understood but rather avoiding being mis-understood. There is an opportunity to align brand messages simply and a deep, confident understanding of the audience will help. Ensure the right tone of voice and use of language – don’t over promise or provide messages that may be perceived as generic and similar to the competition. Ensure there is a compelling reason to believe your proposition. Align your brand messages across clinical and non-clinical audiences and be clear on the call to action.
Differentiate – Meaningful clinical and budget impact differential is difficult for pharmaceuticals to achieve quickly. The role of branding has its place, but differentiating HOW you engage with ACOs will help drive local access. Being expert, relevant and appropriate can be a huge differentiator compared to competitors who place a superficial emphasis on ACOs – become the partner of choice in your given therapy area.
Understand ACO Resource Allocation – Typically, ACOs will see the costs of care as falling into three categories: consumables, location costs and people costs. It is broadly accepted that the consumables budgets (including drug budgets) are the easiest to address as they are easier to quantify and do not have political impacts such as staffing reductions or the closure of unnecessary hospital facilities. The challenge therefore is to define the optimum patient journey that ensures all appropriate steps are taken and implemented effectively, whilst reducing unnecessary staff or location costs objectively and defensibly.
The most robust way for this to be achieved is through ‘bottom up’ analysis at a local level. Whilst commissioners and service development leads aspire to address every service in this way, resource limitations mean new service models are more commonly developed through ‘top down’ analysis based on tariff costs. There are pros and cons to both approaches, but understanding how you can help ACOs take a more ‘bottom up’ approach may help put the cost of your medicine in context and provide a compelling ‘reason to believe’.
Help ACOs meet quality metrics as well as reducing costs – Whilst reducing costs will remain the top priority for many payers, ACOs will be more incentivised by quality because their financial rewards will depend on their ability to meet certain quality metrics. Pharmaceuticals can play an important role in both reducing costs and improving quality for ACOs. For some conditions, Pharma has the opportunity to significantly reduce costs through outpatient medical management and the reduction of hospital admissions.
Keep up-to-date – ACOs are new to the NHS landscape and will continue to evolve rapidly and in unpredictable ways. Fostering key contacts within pivotal organisations in pilot areas will help you understand how you can benefit your brand in this new and often fragmented environment. Ensure your customer-facing teams are trained to competently and confidently understand the needs of their customer and how they align to commercial brand strategy. Prioritise training for your customer-facing teams. Make training a ‘journey’ rather than just an ‘intermittent destination’ and consider using various training models to achieve this.
Think local – ACOs will be responsible for larger areas than before, which may impact commissioning boundaries. Understanding these new localities and their needs will be fundamental to your brand’s success.
Position your organisation for partnership opportunities – Extensive joint working initiatives may be ambitious in the short-term. With many ACOs in very early stages of development, it may be unclear how a partnership would be structured. But positioning your organisation as a credible partner that understands the early needs of the ACO is vital for future joint working.
Coordinate and build new value propositions for your brands that ACOs will accept – Realign your narrative to meet the needs of emerging ACOs. Make sure you understand their outcomes metrics – which will most likely have a heavier focus on key themes such as prevention and improving quality. Consider that payer communications should align well with healthcare professional communications since they will be accountable to the same organisation.
Don’t align your commercial models just yet – ACOs are the ‘new kids on the block’ and are currently forming in multiple different guises, so wait until the dust settles before any major commercial restructures. That said, industry’s engagement with these new entities will test traditional commercial models and ultimately could have broader effects on access to medicine.
Be prepared for change – Brexit and the snap election in June has the potential to change the future political landscape, so keep innovations to pilot phase – but explore in earnest to aid your knowledge and confidence to move forward.
At Triducive we work with an extensive network of payers across the UK and Europe, so we have an in-depth knowledge of their needs. As a health & payer communications consultancy with over 50 years combined experience working with payers, we are skilled at aligning marketing activity with payer needs to ensure our clients maximise the opportunities facing their brand.
As a consequence, Triducive offers a range of proven tools and solutions that enable our clients to effectively engage with the changing NHS to ensure that new technologies are adopted and available to patients.
To further discuss the issues in this paper or to organise a meeting with Triducive to talk about your wider payer communications challenges, contact us on: +44 (0)7947 130 425 or email email@example.com
1. Next steps on the NHS Five Year Forward View (March 2017) https://www.england.nhs.uk/wp-content/uploads/2017/03/NEXT-STEPS-ON-THE-NHS-FIVE-YEAR-FORWARD-VIEW.pdf Accessed May 2017
2. The term used by the CQC chief inspector of hospitals in The State of Care in NHS Acute Hospitals 2014-2016, CQC 2017
3. Affordable Care Act 2010 https://www.healthcare.gov/where-can-i-read-the-affordable-care-act/ Accessed May 2017
4. Five Year Forward View (October 2014) https://www.england.nhs.uk/wp-content/uploads/2014/10/5yfv-web.pdf Accessed May 2017
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