Programme Budgeting – Testing The Approach in Scotland

Appendix B: PBMA - experience from England

1. In 2002, the Department of Health in England initiated the National Programme Budget Project. The aim of the project is to develop a source of information, which can be used by all bodies, to give a greater understanding of where the money is going and the return on the investment in the NHS. The project aims to provide an answer to these questions by mapping all PCT and SHA expenditure, including that on primary care services, to 23 programmes of care. These programmes reflect ICD10 categories, plus two non clinical groups^[18] and an 'other' category. The focus on clinical conditions is intended to forge a closer and more obvious link between the object of expenditure and the patient care it delivers.

2. There are three drivers of programme budgeting:

• a way of monitoring where NHS resources are currently invested
• a way of assisting in evaluating the effectiveness of the current pattern of resource deployment
• a tool to support and improve the process for identifying the most effective way of commissioning NHS services for the future.

3. The Programme Budgeting project provides a retrospective appraisal of NHS resources broken down into 'programmes', with a view to influencing and tracking future expenditure in those same programmes to achieve the greatest health improvement per £ spent in the NHS.

4. At national level, all PCTs in England have collected data for the past 6 years using the 23 categories. PCTs are also required to 'use the budgeting information to review the relationship of expenditure to outcomes in their highest spending categories (usually mental health, CVD and cancer) and identify opportunities for improved value for money'. PCTs are grouped into clusters which allows them to make comparisons between themselves and others which have similar characteristics. There is an online PB benchmarking tool^[19].

5. The data have been used by researchers from the Centre for Heath Economics at the University of York to analyse the link between spend and outcomes. The latest paper^[20] found that in several care programmes - cancer, circulation problems, respiratory problems, gastro-intestinal problems, trauma burns and injury, and diabetes - expenditure had the anticipated negative effect on the disease-specific mortality rate.

6. Furthermore, the NHS Institute for Innovation and Improvement has supported road testing of the PBMA approach in 3 English regions. The road testing involved three different programmes of care in 3 different areas - diabetes in Hull, CAMHS in Newcastle and mental health in Norfolk. Each pilot was predicated on the assumption that any additional investment would require the identification within the budget of a corresponding resource releasing disinvestment.

7. The Norfolk pilot for example did identify areas for disinvestment, including £194,000 released through changes to prescribing practices which would be used to fund a holistic mental well being service and to develop a young persons' one stop shop.

8. The subsequent evaluation of the 3 programmes looked at:

• Acceptability
• Data availability
• Practical value
• Generalisability

9. The experience reported in the three sites varied, but a number of conclusions were identified:

• there are a lot of data available for use in PBMA, yet costing of options for potential investment, disinvestment, estimating options and identifying options for disinvestment in services were still challenging
• PBMA has the potential to change patterns of service, providing this is linked to the commissioning / service design process
• There is enthusiasm to make PBMA part of the commissioning process.

10. A number of recommendations were subsequently made surrounding aim and scope, engaging stakeholder groups, determining the programme budget, valuing costs and benefits of potential service changes, evaluating these changes, validity checking and making final decisions.