This report is part of the research of the Policy Research Unit in Commissioning and the Health Care System (PRUComm) on new models of contracting in the NHS, commissioned by the Department of Health.
Over the past few years the need to find new ways to integrate services has become an important policy priority in the English NHS. The formation of new organisational configurations in local health economies announced in the Five Year Forward View entails separate organisations working closely together to improve the integration of local services and allow the better use of resources. One way to achieve collaboration across organisational boundaries is through the adoption of new models of contracting, such as alliance contracting, prime provider contracting and outcome based contracting. Despite their relative novelty in the English NHS, these models have a history of use in other sectors such as construction and defence, as well as in the commissioning of public services in the UK and overseas.
This report summarises the findings of a literature review of the available evidence concerning the characteristics of these new contractual models and their implementation in other sectors. The available evidence is considered in order to draw out the lessons which may be learnt to aid the implementation of these models in the English NHS.
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This is the fourth annual review of our research and provides a brief overview of our current research activities.
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The paper investigated how the formal national provisions for pricing in the National Health Service (which are a form of prospective payment, known as ‘Payment by Results’) are operationalized at local level. Transactions costs theory and existing evidence predict that actual practice often does not comply with contractual rules. A national study of pricing between 2011 and 2015 confirms this and indicates that such payment systems may not be appropriate to address the current financial and organizational challenges facing the NHS. As the NHS struggles radically to reconfigure services, it is necessary to reconsider the appropriateness of a wider range of pricing mechanisms to facilitate moving care out of hospitals.
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This three year project aimed to investigate how commissioners negotiated, specified, monitored and managed contractual mechanisms to improve services and allocate financial risk in their local health economies, looking at both acute services and community health care.
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This interim report presents findings from a research into how commissioners negotiate, specify, monitor and manage contractual mechanisms to improve services and allocate financial risk in their local health economies, looking at both acute services and community health care.
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