The new systems of accountability have been introduced in many health systems, including Australia, New Zealand, the United States and the United Kingdom, despite different approaches to organising and financing health care in each country.
The United Kingdom
The United Kingdom was the first European nation to adopt the private sector approach to the publicly funded National Health Service (Griffiths and Hughes 2000). These changes were mandated in the National Health Service and Community Care Act, 1990 and included the separation of the NHS into purchaser and provider roles. The ‘purchasers’, health authorities and fundholding GPs, had the power to purchase services from NHS Trusts. The competing NHS Trust hospitals secured funding by entering into contracts with purchasers. The NHS Trust hospitals were divided into cost centres called clinical directorates in which clinicians were required to work alongside managers to deliver care within agreed budgets. This arrangement, as well as the employment of doctors directly by the NHS trusts, rather than the health authorities created a new level of governance of the health service which extended to the micro-management of the health service by the government, rather than simply the allocation of resources.
The Patient Charter (which has recently been superseded by ‘Your Guide to the NHS’) was an important outcome of this model of management (Griffiths and Hughes 2000). The Patient Charter specified a number of quality targets, such as waiting times for patients. Trusts that did not achieve the targets, or that failed to supply the information about quality were subjected to financial penalties.
The new accountability systems extended to the management of clinicians who were required to negotiate with managers to ensure that they could meet the contractual requirements. Contracts specified the quantity, quality and the cost of the services to be delivered, which, in many cases, only the clinicians had the knowledge to provide this information. This, in turn, led to the growth of ‘evidence-based purchasing’ which was linked to the NHS Research and Development Initiative which emphasises effectiveness and measurable outcomes.
Clinical governance was introduced in the UK as a quality and accountability mechanism designed to improve current and future care delivery (Department of Health 1998). A number of accountability procedures are incorporated under the clinical governance umbrella, including the introduction of personal learning plans,
complaint analysis, significant event analysis, benchmarking and sharing best practice (Campbell, Sheaff et al. 2002). Health trusts have incorporated different approaches to clinical governance. Managers of primary care trusts who were interviewed about the introduction of clinical governance raised important issues around the implementation of new mechanisms of accountability. It involved 'getting the culture right'; the introduction of sustainable infrastructure in terms of organisational values as well as information technology; and avoiding a culture of blame (Campbell, Sheaff et al. 2002). Managers perceived that there was a lack of clarity about the role of quality systems in the implementation of clinical governance. The same managers identified barriers to the implementation of the clinical governance which included a lack of support by practice staff, lack of financial and technological resources to implement the approach and too rapid a pace of change.
Broadbent has traced the impact of the new management styles accountability on GP practice in the UK in the early 1990s (Broadbent and Laughlin 1998). The authors identify three different approaches to the delivery of care which have been directed by contractual outputs. Prior to 1990, general practice was illness based with a curative emphasis and per-capita financing. Accountability was to the patients and the profession. In 1990, as a result of the introduction of the National Health Service and Community Care Act, 1990, contractual arrangements specified a shift to disease prevention and health promotion. Per capita financing was linked to contractual requirements, such as home visits to the over 75’s and consultations that were aimed at reducing the risk of illness. Direct financing was provided for achieving targets for childhood immunisation and conducting child surveillance. Accountability was made more explicit to the professions through medical audit, and to the purchaser, through contractual fulfilment. After 1993, the contracts were revised to change the emphasis on health promotion and increase the importance of population health data collection. The labour government changed these systems of accountability yet again with the introduction of clinical governance. These changes illustrate the power of contracts to influence the emphasis of the delivery of health care and control the levels of information being fed from the purchaser to the provider.
Under proposals in the New NHS Modern, Dependable and subsequently, the NHS Plan, the performance of NHS organizations is ranked in league tables which draw on performance indicators and key target areas (Department of Health 1997; Department of Health 2000). The value of the indicators are being debated on the basis of their robustness, their ability to detect significant differences between organizations, the weightings given to various performance preferences the level to which they reflect 'good practice' (Brown 2002; Klein 2002).
Flynn and colleagues examined the impact of new-managerialism on community health services in the NHS through case studies of three NHS community health services in England (Flynn, Williams et al. 1996). Their study highlights a number of difficulties with the approach in this setting. Firstly, they identify the problem clearly defining community health services, however categorise them as formal health services that are not provided by a GP or in a hospital. In addition, they are seen as ‘network’ organisations which are involved in continuous negotiation with a range of different agencies, providers and voluntary organisations.
Flynn et al highlight some of the common criticisms of the application of ‘quasi markets’ to health service management, including market failure, and the question of whether purchasers have the skills to effectively act as agents for consumers. Market failure describes the imbalance of knowledge between the purchasers of care and the providers of that care; where there are barriers to the introduction of new suppliers; and where evidence of outcomes is unreliable. However, their analysis of three case studies of community health services in the English NHS identified further barriers to the approach.
Purchasers and providers perceived that new-managerialism was more difficult to apply to community health services than acute services because of differences in the nature of service delivery. For instance, community health services focus on ‘care rather than cure’, are more continuous and the end-point of care delivery is less easily identified. In contrast, the model fits more neatly bounded services such as surgery which have a more clearly defined intervention and outcome.
“Contracts between organisations will be attractive to the extent that the good or service is amenable to unambiguous written specification; joint gains from collective action are potentially available; implementation does not create costly haggling; monitoring agreements is not costly; and penalties for non- compliance can be enforced at low cost” (Flynn, Williams et al. 1996).
The introduction of new-managerialism and the resultant focus on contracts as a way of procuring income changed the roles, responsibilities and relationships of all the stakeholders involved in care delivery. Providers required new skills in business planning and marketing strategies in order to address the new contractual requirements of their services. The changed relationships between the purchaser and the providers required major changes in organisational and professional culture. The concept of competition that is implicit in new-managerialism was a problem for community health services. The very nature of community health care means that services need to be located within their community. Inefficiencies were likely to arise from the duplication of services in a single area in order to increase competition. In
contrast, the acute sector lends itself more to competition because of the ability of purchasers to chose from services that are provided in a distinct location, but more likely to be replicated.
The use of contracts as a basis for service purchasing brought with it a new set of prerequisites: the services need to be defined; the quantity and price of the services had to be agreed; the quality of services had to be determined; and the conditions under which either party could withdraw from the contract had to be made explicit. These issues presented a number of barriers within the community health setting. As previously stated, there were difficulties clearly defining and coding community health services. The definitional issues were confounded by the wide range of procedures available, the variety of providers employed in the community setting, the heterogeneous nature of the service users and the difficulty defining a community ‘contact’. As a result, purchasers tended to focus on activity data, even though it was acknowledged by both purchasers and providers that this was a poor indicator of what actually takes place in health service delivery.
The identification of outcomes was linked with the ability to address population needs with health services, leading to the widespread introduction of health needs assessments. However, there were difficulties determining how to link needs with services and then to demonstrate the outcomes of those services. Additionally, it was unclear whose role it was to undertake the health needs assessment. The providers felt that they had access to more appropriate information about health needs due to their hands on role, however the purchasers were resourced to examine population need. One case study site demonstrated the conflict that arises when funding is linked with resources, needs and outcomes: when issues arose about which services to prioritise, they questioned whether to invest in services based on population need, or those that provide an income to the service area.
The lack of comparative data in the community setting created difficulties in the development of contract information. In contrast, the acute sector had been collecting information for a number of years about their services that could be used in contract development.
Service costing was also difficult to determine. Flynn et al define five dimensions that can be included in cost data: settings (location of care delivery); condition (patient’s condition); activity (type of care or procedure); clients (who is being cared for) and care input (who is delivering the care). The only information that was routinely available in community health services was information about care input, resulting in large variations in costs across services, whilst providing little information about the
There were also problems measuring the quality of care. Two elements of care quality were considered important: the specification of the services required, and the impact of services on patient care, or outcomes. This led to two difficulties in the purchasing process. Firstly, it was unclear how to incorporate health care quality into contracts. Secondly, services were unsure how to measure or demonstrate the outcomes of care. The measurement of outcomes was highlighted as a difficulty in all three community health services examined by Flynn et al. The purchaser and providers believed that it should be possible to introduce health outcomes into community health services, however only a few examples had been introduced during the study period. Interestingly, all the organisations were optimistic about the possibility to identify appropriate outcome measures in community health services (such as wound healing rates and length of treatment times), although two acknowledged that they did not have sufficient resources to develop the measures required. The result was the continued reporting on process data, rather than outcomes.
The introduction of new-managerialism itself created excessive demands for information which were difficult to meet due to limited information technology resources, and difficulties defining the components of the information (such as outcomes, services, and contacts). There was debate around who should have access to particular information. For instance, the provider questioned whether the purchaser should have information about resource use, or just activity levels and costs. There was a perception by one case study site that a focus on outcomes in purchasing contracts would inappropriately increase the transparency about all levels of service input that was provided to the purchaser, rather than simply reporting on outputs or throughput.
The problems with the introduction of new-managerialism in the community health sector appear to be dominated by the difficulty defining what the community sector does, who the services are for, and how to measure the outcomes of the care, or as Flynn summarises: these are problems of ‘conceptualisation, information and location’ (p32). All three case studies highlight the difficulties monitoring quality as a purchasing tool, focussing on activity and expenditure instead.
The UK system has undergone a number of changes subsequent to the election of the Labour Government in 1997 which still includes the separation of purchaser and provider. However a more collaborative approach to health care delivery has been introduced through pooled budgets and Joint Investment Plans which are based on 'service agreements' rather than purchasing of clinical services (Department of Health 2000; Department of Health 2002).
The United States
The new management techniques have been applied to health care in the United States since the mid 1980's. The Health Care Financing Administration introduced the notion of institutional 'report cards' in 1987 in response to mortality rates of Medicare patients (Wakefield, Hendryx et al. 1996). Report cards have now been adopted by the managed care sector as a way of providing comparative information about the costs and quality of care to the service users (McGillis Hall 2002). Report cards can be mandatory, or be provider initiated.
Provider initiated report cards are seen as a mechanism of public accountability by the health care providing organisations (Kohn, Corrigan et al. 2000). Two types of report cards have emerged; the consumer report card, which is designed to inform the public; and the balanced scorecard, which is aimed at measuring organisational performance and allows benchmarking between organisations (Kaplan and Norton 1993). Balanced scorecards examine performance from four perspectives; the customer, internal, innovation and learning, and financial. Variations on these four themes have been adopted in the Canadian health setting, and in other services (Baker and Pink 1995).
The use of report cards has both highlighted a number of barriers to performance measurement, and has itself come under criticism. The use of report cards has led to the realisation that "disclosure of performance is often based only remotely on unknown relationships between processes and outcomes" (Kazandjian 2002:207). Research has shown that report cards are of more interest to health care organisations than consumers (Bently and Nash 1998). Further, there is evidence of a lack of standardisation of and consensus on report card indicators (Slovensky, Fottler et al. 1998; McGillis Hall 2002). Much of the published literature on report cards describes their use in the acute care setting, thus the indicators employed tend to reflect an acute and medically dominated approach (Gandhi, Francis et al. 2002; McGillis Hall 2002). One study that attempted to apply the report card model in an ambulatory setting found a lack of correlation between the variables of performance that were measured (Gandhi, Francis et al. 2002). A study which examined the use of report cards in the management of diabetes (as a prevalent primary care condition) found that they were unable to detect differences between doctors and questioned the relevance of these indicators for reflecting what was actually done (Hofer, Hayward et al. 1999).
Australia
of hospital funding reflect the rapidly shifting values of the health service, and the perception that changes to the funding mechanisms can be used as a tool for health care reform. The Australian Health Care Agreements (AHCA) superseded the Medicare Agreements in 1998, establishing a range of indicators against which the States and Territories are accountable for the provision of public hospital care (Department of Health and Aged Care 2001). The replacement of the Medicare Agreements was designed to remove perceived barriers to the provision of care and reduce the incentives for cost-shifting between the Commonwealth and States and Territories (Magarry 1999). Performance indicators include hospital activity levels and costs; waiting times and service accessibility; Aboriginal and Torres Strait Islander Health; the integration of care processes; primary care access; quality; medical training and research; mental health and palliative care (Department of Health and Aged Care 2001). The AHCA acknowledge the need to develop appropriate performance indicators on efficiency, quality, appropriateness, accessibility and equity of health services and has prioritised the development of improved information technology infrastructure within the health system (Department of Health and Aged Care 2001).
The AHCA has been attacked on the basis that it is still an approach to funding rather than an instrument to implement health policy and that it does not incorporate primary care (Reid 2002). A recent meeting of the Australian Health Ministers Council highlighted the importance of the continuity of care and interface between different sectors of care which may be incorporated into the 2003 - 2008 AHCA objectives (Reid 2002).
At the state and territory level, new-managerialism has been adopted through the disaggregation of public sector bureaucracies into separate purchasing and providing organisations (Bloom 2000). Two different models of purchaser provider separation have emerged. New South Wales and Queensland have adopted a model of integrated, regional health care through a centralised purchaser and provider, whereas, for example, Victoria, South Australia and the ACT have adopted the more market oriented, output based funding through separation of the purchaser and provider roles (Bloom 2000). The effect of these reforms have been the establishments of contractual agreements between the purchasers and the providers (Bloom 2000:142), commonly termed the ‘purchaser – provider’ model. The result of the purchaser-provider model is the establishment of contractual interfaces between a number of stakeholders, such as parliament and the executive; political and bureaucratic purchasers and public or private providers (Stewart 1999).
Purchaser – provider separation is designed to optimise efficiency by ensuring that all actions and information are explicit and that parties can be held accountable for their actions. Purchaser - provider separation enables the purchaser to obtain more accurate information about the costs of services by subjecting providers to competition, by benchmarking providers against each other, and by forcing providers to specify the exact nature of the goods and services they will provide at a specified price (Stewart 1999). The impact of NPM on health service provision is the privileging of scientific / objective knowledge over narrative or subjective knowledge. The systems that have been established to ensure accountability within health services under NPM reinforce these models.
Despite the fact that management style accountability techniques have been used in the health sector for nearly 20 years in many countries, it appears that accountability technology is still in its infancy. The shifting applications of accountability models reinforce Mulgan's chameleon-like metaphor. The more managers and clinicians try to define and unpack the components of health service delivery, the more complex these components become. Additionally, the changing values of health care delivery