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Patient-level Costing Data Will Be Critical in Maintaining Care Quality While Cutting Costs, Say NHS Finance Managers

Wednesday, August 4, 2010

Detailed financial data at individual level will take on crucial role in cutting waste, not clinical care as NHS strives to meet government’s target for cuts

Accurate treatment costs at patient level will become crucial in helping NHS managers identify and cut waste without affecting care,  according to a group of senior NHS financial staff.

Members of Ardentia’s patient level and information costing (PLICS) user group agreed that having access to accurate data on individual patients’ treatment costs should be a priority for trusts, before they embark on cost-cutting programmes. 

The group warned that without access to this information, NHS management is potentially putting care at risk in the quest for the savings recently demanded as part of the Government’s restructuring of the Health Service.

Keith Sherratt, head of Ardentia’s PLICS development team said:  “The pressure on NHS trusts to make significant financial savings is tremendous.  But trusts have to know exactly where those cuts can be made, to avoid impacting on the quality of care they provide.  Financial reporting has to be based on the actual costs incurred, not just within service lines but at individual patient level, so the true costs of treatment can be calculated.”

A key current focus for several user group members is investigating the utilisation of operating theatres in hospitals.  Ardentia will shortly release an updated version of its Theatre Performance Manager module, which links to its core Healthware Data Warehouse to help better manage theatre usage. 

With the running cost of an operating theatre estimated at £4,000 per session, the software module helps to ensure that the costs incurred by specialties that underuse their scheduled operating time should be attributed to only those specialties, and not spread across all specialties using theatres.

“Access to detailed cost breakdowns helps NHS managers to identify areas where efficiency can be improved or savings made, without compromising the quality of care.  Patient-level costing is the only way to get this level of insight, and ensure that waste, not care, is being cut,” added Sherratt.

Ardentia’s PLICS user group members have already implemented patient level costing across several departments within their organisations, enabling investigation into the financial performance of each department, and helping to identify where operational improvements and efficiencies can be made.

This approach is already delivering benefits, according to group members, as it helps to show variances in treatment costs from tariffs, and the reasons behind the differences, enabling realistic discussions between clinicians and managers on where resources could be better allocated to improve clinical efficiency. 

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