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Focus on the Towards Practice based commissioning Directed Enhanced Service (England only)

Originally issued in February 2006

• Appendix 1 - GPC analysis of latest Department of Health policy
• Appendix 2 - Sample practice plan
• Appropriate levels of activity under the TPBC DES - go to there now
• Background
• Enhanced services and PBC
• How the DES works and what it covers
• Introduction
• Role of LMCs
• Taking on commissioning activity greater than the scope of the DES
• What the DES does not cover
• Working jointly with other practices

This guidance note is no longer current as the one-year 'towards practice based commissioning' directed enhanced service came to an end on 31 March 2007. It should therefore be read for reference purposes only.

1 Background
This guidance note should be read in conjunction with the following documents:

• ‘Towards practice based commissioning’ Directed Enhanced Service (TPBC DES) specification (20 February 2006)
• Chapter 9 of the Joint General Practitioners Committee (GPC) -NHS Employers guidance, ‘Revisions to the GMS contract, 2006-07: delivering investment in general practice’ (20 February 2006)
• Department of Health guidance, ‘Practice based commissioning: achieving universal coverage’ (26 January 2006).

The General Practitioners Committee (GPC) is supportive of the principles of practice based commissioning (PBC) and the opportunities it presents to improve services to patients. However, we remain concerned about the potential barriers to the successful implementation of the initiative, one example being inadequate management resources available to support the work involved. The recent Department of Health guidance ‘Practice based commissioning: achieving universal coverage’ we believe has introduced some new disincentives for GPs which may prove to hinder the development of PBC further. A short GPC analysis of the Department of Health guidance can be found at appendix 1 and serves to highlight some of these latest concerns.

Practices should be fully aware of the arrangements pertaining to and implications arising from their involvement in commissioning at any level.

2 Introduction
The ‘Towards practice based commissioning’ (TPBC) Directed Enhanced Service (DES) will be offered to all general medical services (GMS) and personal medical services (PMS) practices from April 2006, for one year only. It is a low level, introductory scheme, principally intended to incentivise practices to start engaging with the primary care trust (PCT) on the approach to service redesign from their practice point of view, in order to inform and prepare them for greater involvement in commissioning at a later date. It ‘… provides a set of incentives around the key areas that will be important to focus on initially’ (paragraph 4) and is not intended to resource any additional management costs associated with operating PBC. Practices should not undertake any level of activity under the DES that the associated funding does not adequately resource.

The level of practice sign-up to the DES – measured first in April 2006 and then January 2007 – will be used to monitor coverage of PBC across England (see analysis of Department of Health guidance).

3 How the DES works and what it covers
3.1 Component 1 (C1): ‘Planning and redesigning patient flows’

• The first component – which amounts to 95p per registered patient based on the practice list size as at 1 April 2006 (see paragraph 9.2 of the joint GPC-NHS Employers guidance) – is payable upon agreement of a plan between the practice and the PCT.
• A template plan has been included with the DES specification, details of which can be found below:
• Practice name and details and if joint plan with other practices;
• Agreed scope of services covered by indicative budget. [Note that the Department of Health guidance ‘Practice based commissioning: achieving universal coverage’ states that PCTs are expected to provide all practices with an indicative budget by April 2006 (see paragraph 28)]. Description of specialties and nature of service (acute/elective) which practice is to redesign in order to improve services to patients and/or the nature of activity/planning to be undertaken by practice to achieve more appropriate hospital usage;
• Method by which quality of the redesigned services will be assured/demonstrated;
• Agreed baseline of referrals and/or admissions by speciality for 2005/06;
• Agreed threshold for meeting the objectives in this DES plan to trigger the award of component 2. [Note that the practice objectives should be ‘reasonable and achievable … [and] relevant to the practice’s existing circumstances’ (see paragraph 14 of the DES specification)];
• Agreed information and monitoring requirements by PCT and practice.
• The DES specification suggests a few further inclusions for the practice plan:
• Details of practice clinical engagement, including identifying a clinical lead;
• How the practice plan links to the PCT’s strategic plan and local priorities;
• Although practices can take up the DES at any time in-year, there is an expectation that they will do so by the end of April 2006 and that plans will be agreed, and C1 payments made, by the end of June 2006.
• Practices can produce a composite DES plan with other practices in the area and still be eligible for payment of C1. However individual practices will still be accountable for achieving the specific objectives set out in the plan. [Note that practices should avoid the temptation to pool C1 payments to fund any additional management costs associated with operating PBC, or to pass individual payments on to the PCT for a similar purpose.]
• C1 funding is intended to resource the practice time needed to develop and implement the DES practice plan. [Note that it is for practices to decide how to utilise these payments.]

3.2 Component 2 (C2): ‘Demonstrating success’

• The second component – which amounts to a further 95p per registered patient based on the practice list size as at 1 April 2007 (see paragraph 9.4 of the joint GPC-NHS Employers guidance) – will be payable upon achievement of the objectives set in the plan.
• If implementation of the plan frees up resources from the indicative budget and these are equal to or greater than the equivalent of C2, then the practice will be able to access as a minimum the equivalent of C2 from these resources, but will not receive a C2 payment in addition. [Note that the arrangements relating to access to freed up resources that are greater than the equivalent of C2 is not covered by the DES; see paragraph 4.1 below].
• Where the freed up resources are less than the equivalent of C2 and the practice has achieved its objectives, the difference will be met by the PCT. [Note that the arrangements relating to access to these freed up resources is not covered by the DES; see paragraph 4.1 below].
• C2 payments will be paid to practices, where possible, by the end of April 2007 and at the latest, by the end of June 2007. [Note that this will be laid out in the Statement of Financial Entitlements 2006/07 and the DES Directions]. Practices are only eligible for C2 however if they have completed C1.
• C2 (or equivalent) is intended to go towards practice activity designed at continuing achievement against the DES objectives, which are to be delivered during 2006-07.

3.3 PCT support for practices
The DES sets out various areas where practices should receive support from the PCT, they include:

• A minimum package of information relating to practices’ use of health services as detailed in paragraph 12 of the DES specification. [Note that the Department of Health guidance ‘Practice based commissioning: achieving universal coverage’ states that such information should be provided by the PCT on a monthly basis (see paragraphs 21-27)]. Where practices believe that the data provided is inaccurate, PCTs are expected to work with the practice to ensure the data’s accuracy;
• A summary of the PCT’s strategic and local priorities so that practices can be aware of these when developing their plans (see paragraph 12 of the DES specification);
• Clinical reviews of appropriateness of provider activity and emergency admissions (see paragraph 18 of the DES specification).
• The delivery of national priorities (see paragraph 18 of the DES specification).

3.4 Wider context of PBC proper

• The TPBC DES is intended to promote engagement in PBC and not, by way of its minimum pricing, to be an obstacle to the development of PBC locally. Hence the continuation of existing local arrangements for engagement with PBC are not precluded by it, nor are the establishment of alternative or additional schemes following introduction of the DES (see paragraph 7 of the specification).
• Where existing local arrangements have not been resourced as a minimum to the level of the DES, from April 2006 practices will be entitled to seek that the equivalent funding is provided for their continued activity (see paragraph 7 of the specification).
• Already agreed resource for commissioning activity that exceeds the level of the DES funding should be honoured (see paragraph 7 of the specification).
• Where PCTs and practices agree additional workload to that covered by the DES, additional resource to the DES should be made available (see paragraphs 4 and 9 of the specification).

4 What the DES does not cover
The specification does not cover all areas concerning involvement in the TPBC DES; these relate to issues on which it is not the place of the DES specification to dictate. As a result, practices and PCTs will need to refer to the Department of Health guidance ‘Practice based commissioning: achieving universal coverage’ and agree some local arrangements to complete the national scheme outlined in the DES specification.

4.1 Access to and use of freed-up resources
We would advise practices to obtain precise and clear written agreement in advance – ideally in the DES practice plan – to cover the scenarios below (see also section 9 of the sample plan at appendix 2 ).

• The event of resources freed up through activity under the DES being less than or equal to the equivalent value of C2 and the practice not having achieved its objectives
• Practices should be able to access these monies and reinvest them in the same way as they would have been able to do upon achieving their objectives i.e. for practice activity designed at continuing achievement against the TPBC DES objectives. At the very least, practices should be able to access a significant proportion of these resources, in line with paragraph 47 of the Department of Health guidance ‘Practice based commissioning: achieving universal coverage’ which recommends a 70:30 practice:PCT split.
• The event of resources freed up through activity under the DES being greater than the equivalent of C2, whether or not the practice has achieved its objectives
• Practices should be able to access a significant proportion of these resources, in line with paragraph 47 of the Department of Health guidance ‘Practice based commissioning: achieving universal coverage’ which recommends a 70:30 practice:PCT split. As for how these resources should be used, the GPC would advise that they go either towards practice activity designed at continuing achievement against the TPBC DES objectives – which is a stipulated use of C2 DES monies – or reinvestment in ‘services for the benefit of patients locally’ (see paragraph 44 of the Department of Health guidance).
• Timing of PCTs releasing freed up resources to practices
• We would expect these payments to be made to practices in line with the arrangements relating to C2 payments, so where possible by the end of April 2007 and at the latest, by the end of June 2007.

4.2 Indicative budget
The scope of services to be included in indicative budgets and how to calculate the practice budget is covered in the Department of Health guidance ‘Practice based commissioning: achieving universal coverage’.

As noted earlier in this document, the Department’s guidance states that by April 2006, PCTs are expected to provide practices with an indicative budget and we would recommend that practices start discussing this with their PCT at the earliest opportunity. The Department’s guidance also set a minimum scope for the indicative budget which covers all services under Payment by Results (PbR) in 2006/07 and prescribing (see paragraph 32). PbR in 2006/07 will be extended to cover electives, non-electives, A&E and outpatients in all hospitals; it will not cover critical care or mental health. Exclusions from the indicative budget include core GMS/PMS services, specialised services, services commissioned regionally and nationally and national screening programmes (see paragraphs 34-35). Under both the TPBC DES and separate, greater PBC activity, practices do not have to actively manage/commission the full scope of services included in their budget, however, any activity they do undertake and subsequent freed up resources they make will be measured against the total indicative budget. This thereby allows flexibility of involvement, though no flexibility of budgetary responsibility. As a result, it may be more difficult for those practices who take on a low level of activity to fre up resources than those who decide to take on a greater level of activity.

This should not put practices off from doing the TPBC DES since payment of C2 resources is guaranteed if they achieve their DES plan objectives. It should also be noted that DES resources are protected from PCT overspends as where practices achieve their objectives they will receive as a minimum, resources to the equivalent value of 95p/patient for both components 1 and 2.

That said, nothing in the DES specification dictates that the associated budget must cover the minimum scope of services as outlined in the Department of Health guidance above. Practices may therefore wish to discuss with the PCT the possibility of agreeing an indicative budget which covers just the range of services included in the DES plan.

Either way, it is important for at least one budget to be in place for practices to be able to effectively monitor their achievement against the objectives, the level of freed up resources made/not made and to inform the possibilities for service redesign.

For more detail on the budget setting process, refer to paragraphs 28-37 of the Department’s guidance.

5 Appropriate levels of activity under the TPBC DES
The sample plan in appendix 2 provides practices with examples which they may wish to include in their own DES plans. The plan also reflects recommendations made in this guidance note that are not covered by the DES specification, for example in relation to arrangements around freed up resources. The GPC’s sample plan goes into a level of detail above that which the template plan requires; however the intention is that it covers a range of situations that may arise from practices’ discussions with PCTs. It therefore follows that practices’ DES plans do not need to be as detailed as the GPC’s sample plan, though practices may still wish to use it as a model from which to develop their own, practice-specific plans.

For the most part, the DES will enable GP practices to choose a few clinical areas on which to reflect upon and monitor referral patterns, conduct peer-review within the practice where necessary and carry-out some audit and analysis in order to ensure more rational referral behaviour across the practice. It is unlikely to facilitate major service redesign, which would require a far higher level of clinical engagement and workload than the available resources (ie C1) will enable. Practices should however be prepared to consider using alternatives to hospital services, if such services are acceptable to the patient being referred and are available locally. In this way practices can demonstrate support for service redesign.

Practices should work within the resources available and not exceed them; work under the DES should only amount to what is possible for 95p/patient. For example, for an average practice of c. 5,800 patients and 3 full-time GPs and at current market rates, component 1 would fund about 1 locum session (of half a day) every fortnight. [Note that this does not take into account any practice managerial or secretarial time].

Any commissioning activity above and beyond the agreed scope of the TPBC DES should be properly resourced in addition to the DES monies. In order to achieve the long-term vision of effective service redesign and expansion of the range of services available in the community, significant and dedicated clinician engagement will be required. PCTs’ failure to recognise the very real costs involved in commissioning will undermine the value and potential success of PBC.

6 Taking on commissioning activity greater than the scope of the DES
Paragraph 17 of the Department of Health guidance ‘Practice based commissioning: achieving universal coverage’ states that PBC is still voluntary for practices (see paragraph 17). Provision of the TPBC DES is also optional for practices. Furthermore, where practices do undertake the DES, there is no obligation on them to take on greater, commissioning activity in addition to what is agreed in the DES plan.

Where practices do wish to take on a wider range of commissioning activity than the DES funding allows, then they should discuss this and the resources available in order to do so, with their PCT. Upon reaching agreement with the PCT on this approach, practices may consider producing a practice plan and also an ‘enhanced commissioning activity’ plan, which builds upon the objectives that have been set in the DES plan.

7 Working jointly with other practices
As stated earlier in this document, practices can produce a joint DES plan with other practices in the area. PCTs are able to make agreements with groups of practices or consortia, rather than just with individual practices however each practice will still be accountable for achieving the set objectives in order to trigger payment of component 2. Practices which choose to pool some or all of their C1 incentive payments should draw up an inter-practice agreement defining the joint working and financial arrangements and agree a mechanism for receiving the C1 incentive payments with the PCT.

8 Enhanced services and PBC
The TPBC DES is not a specification for the provision of patient services, nor for enhanced GMS care and therefore, strictly speaking, should not be classed as an enhanced service. However, a DES offers the most appropriate payment mechanism for the following reasons: PCTs are legally obliged to commission DESs and pay for them at the nationally-set pricing; DES specifications (and payments) are laid down in statute (in the DES Directions) and practices can chose whether or not they wish to provide them. All the new 2006-07 DESs will be funded from monies over and above the 2006/07 enhanced service floor (which has been frozen at 2005/06 levels) and therefore there should be no confusion as to the correct use of use of floor monies. Furthermore, the joint GPC-NHS Employers guidance says the following:

“5.23 The established criteria according to which a service can be funded from the enhanced services floor, for example that it directly provides patient services, remains unchanged…”

9 Role of local medical committees (LMCs)
There are several areas where LMCs’ involvement in local negotiations on the TPBC DES would be of great value to their GP constituents. Depending on the local medical committee’s (LMC’s) capacity, they might include working towards ensuring the following:

• PCTs offer the TPBC DES to all practices in the area, whether PMS or GMS (see paragraph 6 of the DES specification)
• The level of activity outlined in practice plans is reasonable in light of the resource available and relatively consistent across the PCT area
• Practices’ objectives are reasonable and relatively consistent across the PCT area (see paragraph 14, 2nd bullet point of the DES specification)
• PCTs apply a fair, transparent and consistent budget setting process and practices are provided with an indicative budget by the end of March 2006
• Agreement is reached across the PCT area on the division of freed up resources and in line with the Department of Health’s recommendation that practices can redirect 70% as a minimum
• The relevant information relating to practices’ use of health services is supplied to practices in a consistent and clear format
• Where this data is inaccurate, PCTs are willing to work with practices to resolve this (see paragraph 12, 1st bullet point of the DES specification)
• PCTs develop a system for carrying out clinical reviews of appropriateness of provider activity and emergency admissions (see paragraph 18, 1st bullet point of the DES specification)
• Existing PBC agreements are not undermined or unpicked, especially where they offer a higher funding level than the DES (see paragraph 7 of the DES specification)
• Where alternative schemes to the DES would better suit the local situation, that meaningful discussion between PCTs and practices takes place accordingly
• PCTs give due consideration to funding practice commissioning activity above and beyond the scope of the TPBC DES (see paragraphs 4 and 9 of the DES specification)
• PCTs make clear their strategic and local priorities in order to aid practices in putting together their DES plans (see paragraph 12, 3rd bullet point of the DES specification)
• Spend on the TPBC DES is not counted against the 2006-07 enhanced services floor.

The GPC’s Commissioning and Service Development subcommittee will be producing further guidance on PBC in due course.