Integrated Healthcare Ene2012

8/3/2019 Integrated Healthcare Ene2012

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The search for low-cost

integrated healthcareThe Alzira model rom the region o Valencia


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The NHS European Oice has been establishedto represent NHS organisations in England toEU decision-makers. The oice is unded by thestrategic health authorities and is part o the NHSConederation. EU policy and legislation have anincreasing impact on the NHS as a provider andcommissioner o healthcare, as a business and as amajor employer in the EU.

Our work includes:

monitoring EU developments which have an impacton the NHS

informing NHS organisations of EU affairs

promoting the priorities and interests of the NHS toEuropean institutions

advising NHS organisations of EU funding

opportunities.

To find out more about us, and howyou can engage in our work to representthe NHS in Europe, contact:

NHS European OiceRue Marie Thrse, 21, B-1000 BrusselsTel 0032 (0)2 227 6440 Fax 0032 (0)2 227 [email protected] www.nhsconfed.org/europe

The NHS

European Oice

This publication has been manuactured using paper produced under the FSC Chain o Custody. It is printed usingvegetable-based inks and low VOC processes by a printer employing the ISO14001 environmental accreditation.


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Contents

Executive summary 2Introduction 3Background 4The Alzira model 6

The capitation system 8The transer o risk 9Vertical integration aligning the clinical and business models 11Outcomes 13

The uture o the model a third stage? 14Can the model work in the UK? 15

Reerences 17Further inormation 17


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The search for low-cost integrated healthcare02

Executive summary

The challenges acing the Spanish healthcaresystem mirror those currently concerningthe English NHS: an ageing population,rising costs, and increasing demand. Suchchallenges have propelled managers, cliniciansand policy-makers to look urther aeld orinnovative models that deliver ecient andeective healthcare.

The Alzira model, rom the Valencia regiono Spain, is a pioneering approach to theprovision o healthcare through public-privatepartnership and was subject to an NHSConederation study visit in March 2011,designed by leading UK and European policyexperts. Under this model, the privatecontractor receives a xed annual sum perlocal inhabitant (capitation) rom the regionalgovernment or the duration o the contract

and in return must oer ree, universal accessto its range o health services.

Implemented in 1999, the Alzira model wasoriginally designed or secondary care only,but the model was extended to cover primarycare in 2003. Full integration o healthcareprovision hinged on aligning clinical andbusiness directorates and the use o technology

across all services. A shared patient recordbetween GPs and specialists is a key ingrediento the model, which relies on a rigorousmanagement culture that expects compliancewith procedures and guidelines, uses staincentives and has a strong perormancemanagement system.

This paper reviews the model, in particularrom the UK perspective. While many aspectso the model do look attractive, participants onthe study visit elt there were some obstaclesand issues to be taken into account whenconsidering its replicability into the local NHScontext. These obstacles are discussed later inthe paper.

It was clear that without the inclusion andclinical integration o primary care into

the wider system, this model is unlikely tooperate successully. The importance oclinical integration, supported by incentives,inormation systems, clear goals and eectivemanagement, is key.

However, would it be worth adapting some oits underpinning principles and applying themto the UK context?


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The search for low-cost integrated healthcare 03

Like many other health systems, the NHSin England is experiencing unprecedentedunding challenges. These pressures are orcingmanagers, clinicians and policy-makers to lookurther aeld or innovative models that deliverecient and eective healthcare.

This report identies one particular model,

originating rom the region o Valencia, Spain,which purports to be a pioneering approach tothe provision o integrated healthcare throughpublic-private partnership.

The Alzira model, a mixed management model,was the subject o an NHS Conederation studyvisit in March 2011, led by Nigel Edwards, thendirector o policy and acting chie executiveo the NHS Conederation. The purpose o thevisit was to see rst-hand its evolution, the

integration o clinical and business models,its documented outcomes and the political,economic and societal impact on healthcarein Spain. This paper is a report rom that visit,and examines the aims and components o themodel in light o the current challenges acingthe NHS in England.1

The study visit

The study visit to Valencia was jointly organisedby the NHS Conederation and the NHS EuropeanOce, which has well-established links withsenior policy and healthcare colleagues romacross the EU. Participants included seniorhealthcare proessionals, managers and policyexperts rom ten dierent countries acrossEurope, ensuring a mixture o roles, interestsand experiences. The delegation consisted o28 participants, o whom 15 were rom a rangeo NHS organisations.

The two-day programme was designed byleading UK and European policy experts.These included: Nigel Edwards, then directoro policy and acting chie executive o the NHS

Introduction

Conederation; Stephen Wright, ExecutiveDirector o the European Centre or HealthAssets and Architecture; and Dr Antonio Durn,Director o Tecnicas de Salud, the leadingSpanish healthcare industry consultancy.

The programme included site visits to twohospitals (Hospital de la Ribera and Hospital deManises). Participants heard rom seniorrepresentatives o regional government, theoperating company which holds the contract,clinical and managerial employees and policy leads.

For more inormation on the visit itsel, or tond out about uture opportunities to learnrom good practice elsewhere in Europe, pleasevisit www.nhsconed.org/europe or [email protected]

As a private sector organisation,this is and will continue to beinvaluable inormation or our use indeveloping an approach to deliveringservices to NHS commissioners.Chairman, UK independent sectorhealthcare company

I ound it a very useul visit. I believeit is vital we exploit the contactswithin Europe.Chief executive, NHS trust

The Alzira model is a good example ointegrated care, cooperation betweenpublic administration and private

entrepreneurship and providinghealthcare at low cost, which all arecurrent questions in Finland.Finance director, joint municipalauthority, Finland


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Figure 1. Map of Valencia region

The region of Valencia

The region o Valencia is located on Spainseastern coast and has a population o aroundve million. The regional health ministry has abudget o approximately 4 billion, around 40per cent o the regions total budget. It employsaround 50,000 people and runs more than

1,000 health acilities.

The demand or local hospital provision,coupled with new legislative powers to involvethe private sector in the delivery o healthcare,compelled the regional government to tenderor a new public hospital that would provide alldistrict hospital services or the population otheir area.

The Spanish national health serviceand its recent evolution

The 1986 General Health Service Act in Spainestablished a national health system with17 autonomous health services. The mainprinciples o the system were:

universal coverage

public inancing through taxation

integration o existing health service networks

political devolution to the autonomousregions

a new model o primary care withmulti-disciplinary teams based inhealth centres.

While the Ministry o Health and Social Policyin Madrid denes the national legislativeramework or the Spanish national healthservice, each region is required to compiledetailed health maps setting out the servicesthat will be provided to its population. Regionshave fexibility to raise additional unds orhealthcare provision through regional taxation.

Since the late 1980s, a combination o limitedbudgetary resources and increased public

demand, along with criticism that the Spanishnational health system lacked eciency,fexibility and clinical engagement, has orcedSpanish health managers and policy-makersto look or new, more ecient management

Background

According to the Spanish 1986 General HealthService Act, each region o Spain is dividedinto health areas (or departments) which areresponsible or the management o acilities,benets and health service programmes withintheir territory. Valencia has 24 such areas.

Prior to 1999, health department 11 in theValencia region also called the Riberadepartment was one o the ew without alocal hospital, despite a political commitmentto build a hospital dating back to 1982.

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CASTELLON DE LA PLANA

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ALICANTE

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Region deMurcia

Aragon

Autonomouscommunity o

ComunidadValencia

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1Alzira

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1 Hospital Universitario

de La Ribera2 Hospital de Torrevieja

3 Hospital de Manises4 Hospital de Vinalop


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services that would provide optimum qualityat the lowest possible cost. The 1991 AbrilMartorell Report named ater the man whoheaded a commission to evaluate and makerecommendations to the health sector reiterated these challenges acing the nationalhealth system and set out alternatives toimprove its maintenance and viability. The

report introduced concepts such as separatingthe nancing, purchasing and provision ohealth services, and sought to establish a newlegislative basis or the involvement o theprivate sector in the delivery o healthcare, aslong as it remained ree and universal.

This new legislative base was enacted in 1994and 1997, paving the way or the Alzira modeland other orms o sel-managed hospitalsacross Spain to evolve.

TheAbril Martorell Reportintroduced concepts such asseparating the inancing, purchasingand provision o health services, andsought to establish a new legislativebasis or the involvement o theprivate sector in the delivery ohealthcare, as long as it remainedree and universal.


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In looking or improved managmentarrangements, a number o new modelso healthcare emerged in Spain under thedecentralised Spanish health system.2

The Alzira model is a public-private partnershipmodel which takes its name rom the town inValencia where the rst Spanish public hospital

(Hospital de La Ribera), managed under what is

reerred to as an administrative concession,was built in 1999. This pioneering model isbased on our undamental pillars: publicownership; public control; public inancing;and private management.

Developing the model

The development o the Alzira model took placeover two stages. Originally, it was only envisagedthat the model would cover the delivery o careat Hospital de La Ribera, but soon ater the starto the project, or various nancial and otherreasons, the decision was made to extend thecontract to cover primary as well as secondarycare. A resh approach was designed with theoverall health needs o the population in mind,partly to avoid problems with cost shiting

between primary and secondary care.

The new organisational model was initiatedin 2003, with the existing private contractorassuming responsibility or deliveringhealthcare in both primary and secondarysettings. The capitation budget or thepopulation, which was already being used,was extended accordingly, with most o theassociated risks transerred.

The resulting administrative concessioncontract was the rst o its kind, diering romprevious public-private partnerships by takingresponsibility or a populations ull-servicehealthcare provision.

The Hospital de La Ribera is a 300-bed hospital,oering a comprehensive range o services. Thereare 260 single rooms, 22 ICU beds, ten psychiatricbeds and 13 surgery rooms. It also runs 40 publicprimary care health centres.3

The Alzira model

Key principles of the Alzira model

A single, integrated provider withresponsibility or almost all care provided tothe population the diagnosis-related group(DRG) tari is only used to make paymentsor patients treated outside the network.

Integrated working between primary andsecondary care, with primary care doctorsbeing an integral part o the system. Theincentives or primary care doctors and orthe other parts o the system are aligned toensure that work is carried out in the mostappropriate place.

Systematised clinical work linked to strongincentives or clinical sta to ollow thepathways and operating procedures.

A uniied inormation system and good links

to external data. This reduces transaction costsand ensures that clinical decision-making isalways inormed by reerence to the patientsull history and prescriptions. This, and theuse o a common pathway, also reduces therisks o duplication. The system also allowsor detailed management o clinical processesand accountability or individual clinicians.

Proessional management with delegatedresponsibility, including or proit and loss.

Using networks to provide diagnostic supportrather than replicating these in each site.

External perormance management onoutcomes but not on the details o processes,inputs and periodic procurement.

The administrative concessioncontract was the irst o its kind.


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Figure 2. The two stages of the model

Source: Ribera Salud

Alzira model stage I:1999 2003

Granted or ten years,extendable to 15, orthe management othe specialist medicalcare o a health area

Capitation ee:204 + ConsumerPrice Index (1999)

Building o a newhospital: Hospital deLa Ribera

Original privateinvestment o 61m

Alzira model stage II:2003 2018

Granted or 15 years,extendable to 20, orthe management ohospital and primarycare in department 11

Capitation ee: 379 (607 as o 2010)+ percentage yearlyincrease in the healthbudget

Private investmento 68m during theconcession

Benefits of the model at a glance

Ribera Salud, the health management holding company running the Alzira model, has cited theollowing benefts o the model.For patients:

a higher level o privacy and comort, resulting in more personalised treatment

greater accessibility and a quicker response time

a choice o hospital and doctor

technology at the service o the surgeon.

For professionals:

stable employment with an innovative payment system

opportunities or development and or pursuing a proessional career

opportunities or teaching and research

working in an environment with a strong commitment to technology.

For regional government:

pu blic management at a lower than average and relatively predictable cost

investments paid or by the concessionaire during the management period

capitated payment with inancial risk transer

innovation in management technologies and system s

contribution o complementary human resources.


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One o the novel aspects o this model is thepayment by capitation system, which appliesto all the hospitals operating under this modelacross the region o Valencia. An annual publicexpenditure budget is assigned by the regionto each area health department, according topopulation and the range o services provided.A comparison o the cost per inhabitant in

the region o Valencia and the areas coveredby the model (in Euros) is shown in Figure 3.This budget does not include the cost o someservices, such as extra hospital pharmaceuticalprescriptions, prostheses, oxygen therapy andmedical transport services.

The principles behind the capitation system are:

the private contractor receives a ixed annual sumper inhabitant or the duration o the contract

the annual ee rises in successive years

in line with the regions public healthbudget increase4

in return, the company runs the healthdepartment and must oer universal accessto its wide range o services

the annual ee has to cover all the expensesneeded to provide the service, includingamortisations, payroll, consumables and utilities

annual cost or the Valencia community

and La Ribera management is ixed (subjectto inlation) and can be orecast withreasonable precision.

Ensuring financial stability

The 2003 revision o the administrativeconcession sought to ensure that prots wereshared between contractor and community.Under this revision, the hospital retained protso up to 7.5 per cent o turnover, with protsexceeding this limit being returned to the localgovernment. This was a means o ensuringnancial sustainability or both parties.

Under the model, i patients are treated inhospitals outside the area, the Hospital de La

Ribera assumes 100 per cent o the cost, basedon the relevant tari. In contrast, public hospitalsin other parts o the Valencia region not usingthis model do not lose money i their patientsgo elsewhere. However, as a disincentive to thehospital or using its capacity to treat patientsrom elsewhere, in such cases the hospital isonly reimbursed 80 per cent o the cost (pricedper diagnosis-related group (DRG)) per patient.

The capitation system

Figure 3. Capitation costs


2006 2007 2008 2009 2010

Cost per inhabitant for the

wider region of Valencia

659.53 731.11 780.96 811.74 824.64

Annual fee paid to thecontractor per inhabitant

494.72 535.39 571.90 597.64 607.14

Difference 25% 27% 27% 26% 26%

The 2003 revision o theadministrative concession soughtto ensure that proits were sharedbetween contractor and community.


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Figure 4. The keys of the model


Alzira model

Public fundingThe system o paymentis based on a per capita

payment. The governmentpays the contractor an annual

fxed and pre-establishedsum or each o the

inhabitants ascribed to it.

Public ownershipThe public nature o the

health service is guaranteed

at all times. The health centrethat has been contracted outis a public hospital built on

public land and belongs to thenetwork o public hospitals.

Private provisionThe contract or providing

the health service is awardedor a pre-established periodto a company that commitsitsel to ensuring the properoperation and management

o the public service.

Public controlThe contractor has to

comply with clauses o thecontract. The government

has the power to control andinspect it, and to establish

regulations and imposesanctions.

The particular public-private partnership inthis administrative concession model operatesas ollows.

The construction phase

At this initial stage, investment needs are

very high, or hospital development atleast. Thereore, the budget o the regionaladministration is relieved o this initial cashoutfow. The private bidder usually optsor a turn-key construction contract. Anydeviations in the construction project arethe responsibility o the bidder (the primarySpecial Purpose Vehicle contractor). Oncethe concession period expires, the hospital isreturned to the regional administration as itwill then be their property.

Investment in equipment

The bidder will undertake investment inall necessary medical and non-medicalequipment. The investment plan has tobe approved by the regional administrationat the initial phase and then again every ve

years. Once the concession period expires, the

equipment also becomes the property othe regional administration.

Cost of providing health services

The cost o providing health services tothe population is lower or the regionaladministration under this concession scheme.For example, in the region o Valencia, the costsper inhabitant, paid by the local authority to

The transer o risk


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the contractor, are reduced by around 25 percent rom the costs per inhabitant prior to theconcession contract. They are also lower thancomparable areas within the region, and acrossSpain more generally.

Growing the model across Valencia

and beyond

While the Hospital de La Ribera was the rstpublic hospital to use this model, over 20 per cent

o the Valencia region is now covered by similar

contracts, with the model also used in an areao Madrid. Within the model, all the hospitalsare managed by the Ribera Salud Group, thehealth management holding, and are shownin Figure 5.

The cost o providing healthservices to the population is lower orthe regional administration underthis concession scheme.

Figure 5. Hospitals of the Ribera Salud Group

* According to the Population Inormation System (SIP)

** Investment planned or the 15 years o the ranchise except Torrejn (initial investment)Source: Ribera Salud

No. of beds Populationallocated *

Investment **

Hospital Universitario de La Ribera 300 250,000 140m

Hospital de Torrevieja 264 180,000 90m

Hospital de Denia 222 160,000 97m

Hospital de Manises 220 200,000 137m

Hospital de Vinalop 212 150,000 146m

Hospital de Torrejn 250 140,000 130m

TOTAL 1,468 1,080,000 740m


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Extending the rst-stage model to coverprimary care alongside secondary care, whiledelivering improved unctions and medicalprocesses, presented a real challenge. Crucial

to this development was the need to embed

a new patient-centred corporate culture across

the model.

The clinical directorate at work

Hospital doctors and many GPs working withinthe Alzira model are employed by the operatingcompany rather than the public sector or civilservice as is usual in Spains public hospitals.They are salaried employees within a clinicaldirectorate, organised by clinical coordinatorswho manage outpatient and inpatient activities,on-call duties, holidays and operating lists. The

coordinators are also responsible or arrangingthe support services necessary to achieve theclinical and non-clinical objectives determinedby each medical director. Together with themedical director, the coordinators representthe doctors interests to the hospital board. TheHospital de La Ribera has a continuing medicaleducation programme, overseen by a medicaltraining commission.

Medical salaries have both xed and variable

components. For hospital doctors, the xedcomponent amounts to 80 per cent and thevariable component to 20 per cent, while orGPs the split is 90 per cent to 10 per cent. Thevariable part o the earnings relates to on-callpayments and incentives, a number o whichconcern access targets. Incentives (which arein the range o 6,000 to 24,000 per year) arenegotiated with the medical coordinator andlinked to specied and quantied goals. Salariesare negotiated between the hospitals medical

board and trade unions. In Spain, public sectorwages or physicians vary according to region.

The private salaries negotiated within the

Alzira model tend to be above the Spanishaverage or public sector health wages, whenboth the xed and variable components aretaken into account.

Facilitating the integration

New working methods were implementedduring the second stage o the administrativeconcession to acilitate the necessary

integration o primary care services. These areoutlined below.

Medical linkA consultant physician is attached to eachhealth centre, working with the same patientsas the GP. This link is designed to implementclinical guidelines with the local GPs, resolvemedical problems in the health centre,and reduce the number o inappropriatehospital reerrals.

Integrated primary care centresThese seek to enlarge the scope o some othe health centres, with onsite x-ray services,accident and emergency departments, andmedical specialist outpatient clinics. The aimis to bring medical services closer to patients.

Integrated medical care pathwaysThese attempt to streamline the managemento health problems, rom prevention through

to palliative care, including acute care,rehabilitation and chronic care.

Vertical integration aligning the

clinical and business modelsThe private salaries negotiatedwithin the Alzira model tend to beabove the Spanish average or publicsector health wages.


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The role of technology

From the outset, the hospitals using theAlzira model identied the innovative use oinormation and communications technology(ICT) as an essential tool or eectiveintegration o services. Hospital de La Riberawas the rst public hospital in Spain with a

ully integrated, computerised medical historysystem, including nursing and medical notes,test results and imaging. The principles shapingthe use o technology were that:

IT should be global, integrating all theactivities o the hospital, and should bedesigned with ull integration in mind, basedon health standards

doctors should be able to access data rom

any location within the health area. By linking

the hospitals IT system to that o the localgovernment health department, doctors canaccess data or patients rom any other healtharea directly rom the hospital

technology should support the medicalcare received by patients, improving itsquality and speed. For example, digitalscreens in the hospitals highlight alldepartmental waiting times

economic and inancial data should be ully

integrated within the healthcare system.

A ree access policy was implementedto attract patients to the Hospital deLa Ribera, given that managementmust pay when patients in the healthdepartment are treated elsewhere.

The patients perspective

Although the patient ollows the contract, under the Alzira model they are ree to go elsewhere toreceive healthcare. Its hospitals are thereore incentivised to maintain high standards in order toinspire loyalty in patients and also place a large ocus on disease prevention and health promotion.A ree access policy was implemented to attract patients to the Hospital de La Ribera, given thatmanagement must pay when patients in the health department are treated elsewhere.

What the policy offered

ree access to medical specialties, without initially at least any gatekeeping unction by primarycare, in order to achieve patient loyalty

a choice o medical specialists and hospitals

a wide range o outpatient and elective surgery time slots rom 08:00 to 21:00 (most Spanishpublic hospitals do not provide clinical services ater 15:00)

short waiting times (less than two weeks) in its outpatient department, less than 90 days wait orelective surgery, and an eicient accident and emergency department.

This policy also attracted patients rom other health departments with longer waiting lists, with thecost o their care being charged to the respective local government, subject to the 80 per cent cap.Ater seven years o ree access to specialist care, the system was changed to restore the role o GPsas gatekeepers to hospital care, although perhaps surprisingly there has been no major changein demand levels.


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According to the terms o the administrativeconcession, the hospitals using the Alziramodel have to meet a series o targets set bythe Valencia government and listed in annualmanagement agreements. These targets covera wide range o quality and saety objectives,including: process indicators (or example,waiting times and clinical activity); clinical

outcomes (including immunisation andmortality rates); and patient experience (suchas satisaction and involvement in care, and thenumber o complaints handled on time).

Making a difference

When compared to the non-Ribera Salud hospitalsin the Valencia region, the results achieved by

those using the Alzira model are impressive, ascan be seen in Figure 6.

The model is also viewed avourably by patientsand sta. Satisaction surveys indicate thatit has been eective at retaining patients,a key prerequisite o the model. Similarly,absenteeism among sta at the La Riberahospital is less than 2.5 per cent, well belowthe national and regional average.

Outcomes

Figure 6. Activity results, Ribera Salud hospitals vs. other hospitals in Valencia region


Example indicators Ribera Salud hospitals Valencia region hospitals

External consultation delay 25 days 51 days

Average surgery delay 34 days 6090 days

CAT delay 12 days 90120 days

MRI delay 15 days 90120 days

Readmission within three days (per 1,000

discharges)

4.05 6.1

Patients satisaction (0 to 10) 9.1 7.2

Electronic case history use (hospital) 100% 20%

Major day surgery 56% 43%

Outpatient surgery rate 79% 52%

Caesarean rate 22% 25%

Average hospital stay 4.5 days 5.8 days

Minor emergency 9% 20%

Emergency waiting time Less than 60 minutes 131 minutes

Emergency response time 4 hours No measure

Satisaction surveys indicate thatit has been eective at retainingpatients and absenteeism amongsta is well below the national andregional average.


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The challenges acing the Spanish healthcaresystem largely mirror those currently concerningthe English NHS: an ageing population, rising costs,and increasing demand. Issues that will aect theevolution o the model are examined below.

Leading through the political uncertainty

By passing responsibility or healthcare delivery toautonomous regions, the Spanish governmentarmed the link between local political decision-making and the Spanish health service. The Alziramodel originated in a region notable or theelectoral success o the conservative Popular Party,which has long supported a more diverse provisiono public services. Other political parties havepublicly opposed such changes in provision and theAlzira model itsel, although it is unclear what wouldhappen i there was a change o local government,

given the duration o the administrativeconcessions contract. It should also be noted thatthe severe economic situation acing Spain and itshealth service could lead to unding cuts ollowingthe recent election o a new government.

A revision to the contract model

Given Spains ageing population, one possiblechange to the model involves the integration o

social care into the capitation sum, which wouldpresumably alter the unding model signicantly.This evolution o integration could representanother pioneering model or unding the healthand social care services o the 21st century.

The composition of funders

While the levels o government payment or thelevels o healthcare provision are clearly laid

down, there are challenges or the holdingcompany responsible or managing this model.Recent changes to the legal ramework o theCajas de Ahorro (local banks) have restrictedthe nancial support Spains social banks canprovide, and pushed Ribera Salud to look orpotential new partners.

Using patients as the driver

Given the importance o patient loyalty tothis model, it is important that local citizensunderstand its evolution. Ribera Salud says itwill be ensuring the local population is keptinormed as the model adapts, including onits changing processes, the health outcomes

it achieves, and the associated costs involved.This places signicant emphasis on ullyinvolving patients in governance anddecision-making processes, and educatingthem to take responsibility or their own care.

Virtual, not just vertical, integration

Ribera Salud have been looking or some timeat ways o making the organisation more virtualand less structural, by capitalising on theirinnovative use o ICT. They aim to oer acomplete service portolio in situ to patients inconjunction with other non-concession suppliers.

Moving from staff mix to skill mix

A new proessional leadership approach,building on and reshaping Ribera Saludscorporate culture, would re-evaluate the skillmix across clinical and non-clinical sta, with

an emphasis on clinical governance. There willalso be more ocus on sharing risks with themedical sta, through incentive schemes andthe purchasing o services.

The uture o the model

a third stage?

Given the importance o patientloyalty to this model, it isimportant that local citizensunderstand its evolution. Thisplaces signiicant emphasis on ullyinvolving patients in governanceand decision-making processes,and educating them to takeresponsibility or their own care.


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Nigel Edwards, who led the study visit, hasprovided his policy insight into whether themodel could work in the UK. He argues thatwhile many aspects o the model certainly lookattractive when viewed rom a UK perspective,there are some obstacles and issues to be takeninto account. These are discussed below.

A different approach forcommissioners

The Alzira model requires commissioners totake quite a dierent approach to their role.In this model, the commissioner connesthe contract to the specication o outcomemeasures and only a small number oprocess measures. The ormal powers o thecommissioner to direct the provider in detailare much more limited than is the case inthe UK. This might be an issue in the NHS,where the habit o using the contract to directproviders on not just what to do but how to doit, is ingrained.

Potential for regulatory capture

Study visit participants were concerned that

to a certain extent the representatives o theValencia community administration were veryclose to the concession holders, which couldreduce the eectiveness o the oversight theywere providing (regulatory capture). We alsohad the strong impression that the detail othe contractual relationship was rather morenegotiable than UK public administration maybe comortable with. This has some positiveaspects, and the concession holders clearlyhad a lot o fexibility in being able to adapt

their services. The way that UK public-privatepartnership contract law works tends to requireall small changes to be made as contractvariations the Spanish model seems less rigid.

Nature of the UK General MedicalServices contract

Because Spanish GPs are employees, it hasbeen much easier to incorporate them intoan integrated clinical model. In the UK model,the act is that some tasks which the wider

delivery system might undertake are embeddedin the Quality and Outcomes Framework orare part o core general practice. This meanseither a dicult, i not impossible, negotiationor eectively paying twice or this type o care:once to the practice and again to the new service.

Challenging the provider landscape

A urther eature that might be a problem in an

NHS setting is the extent to which the model islikely to squeeze out all other providers. Socialenterprises, charitable providers and otherniche services could easily nd themselvesatally squeezed by this model. In a UKsetting, the model would probably need to bechallenged to oer a range o suppliers or anumber o areas where choice is important. Forexample, the budget holding organisation couldbe mandated to oer a range o competingservices in areas where dierent styles o

service are required or where perormance ispoor and higher levels o choice are required.

Can the model work in the UK?

Without the inclusion o primarycare and its clinical, managerial andcultural integration into the widersystem, this model is unlikely tooperate successully. The inormationsystems are central to this modeland it is diicult to see how it couldoperate without them.


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Study visit insights

The conclusion rom our visit is very clear:without the inclusion o primary care and itsclinical, managerial and cultural integrationinto the wider system, this model is unlikely tooperate successully. The inormation systemsare central to this model and it is dicult to see

how it could operate without them.

The lower cost o operation between theconcessions and the other areas o Valencia(and Spain) is striking and it seems reasonableto suppose that some o this comes romintegration and the emphasis that capitationputs on cost-eective management and earlyintervention or some conditions, and moreconservative treatment or others.

The use o inormation, better organisationand more rigorous management o care andsta must also play a role. As with systemso this sort in the USA (health managementorganisations) there may also be a conounderthat this approach to practising medicine,and the culture o accountability and use opathways, may attract certain types o sta whoalso contribute to improved perormance. Thereis also a possibility that the usage in Alzira waslower beore the hospital was built due to the

impact o distance on access, and that some othis habit o lower hospital use has persisted.

Disentangling these eects is dicult andmeans there are risks that these benets maybe hard to replicate without great care appliedto the ramework. The lack o a legacy o alarge, expensive and unsuitable estate is alsoundoubtedly a signicant advantage.

Experience shows that many claims that

services are integrated are based only onstructural measures. They do not consider theimportance o integrating systems, processesand culture, and oten clinical care andthe internal arrangements o organisationsclaiming to be integrated are silo-based andragmented, with ew behaviours evidencingintegration. The Alzira model did not seemto have this problem at rst sight, althoughurther investigation is needed to conrm this.

The outcome measures quoted are impressivebut only cover a narrow aspect o the perormanceo the system. A more rigorous investigation isneeded across a wider range o indicators.

It would be worth some o the principles thatunderpin this model being adapted to the UKcontext. The importance o clinical integration,supported by incentives, inormation systems,clear goals and eective management, is key.Structural integration has undoubtedly been

important in supporting the model but it is onlyone part o a complex mix o measures whichhave developed over time. Time is key; theseare dicult models to create and signicantchange management projects.

Nigel Edwards was the director of policy andacting chief executive of the NHS Confederationat the time of the study visit.

The importance o clinicalintegration, supported by incentives,inormation systems, clear goals andeective management, is key.


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1. The programme or the visit and the presentations given can be accessed on the NHS EuropeanOice website www.nhsconed.org/europe

2. There are ive dierent models o sel-governed hospitals in Spain, including the Alzira-styleadministrative concession. These include public healthcare companies (public law entities), publichealthcare oundations (state-owned), oundation hospitals and consortiums. More inormationon these can be ound in the recent European Observatory on Health Systems and Policiespublication, Governing public hospitals, edited by Richard B. Saltman, Antonio Durn and Hans F.

W. Dubois.3. Hospital de La Ribera: www.hospital-ribera.com/english/index.htm

4. In the original irst phase (hospital-only) o the model, indexation was by Consumer Price Index(CPI). This presumably let the contractor too vulnerable to excessive healthcare cost rises. In thesecond phase, indexation was connected instead to the annual increase in the Valencia Regionshealth budget.

Further inormation

NHS Conederation (2006), Building integrated care: Lessons from the UK and elsewhere.

NHS Conederation (2010), Where next for health and social care integration?

NHS Partners Network (2011),A positive partnership the independent sector and the NHS.

NHS Conederation (2011), Remote control: The patient-practitioner relationship in a digital age.

All are available at www.nhsconed.org/publications

Reerences


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This paper examines a pioneering approach tothe provision o integrated healthcare throughpublic-private partnership; the Alzira model rom theregion o Valencia, Spain. The model was the subject oan NHS Conederation study visit in March 2011 to seerst-hand its evolution, integration o clinical andbusiness models, documented outcomes, and political,economic and societal impact on healthcare in Spain.

This paper is a report rom that visit, and examines theaims and components o the model in light o thecurrent challenges acing the NHS in England.

The search for low-cost

integrated healthcare

Rue Marie Thrse, 21, B-1000 BrusselsTel 0032 (0)2 227 6440 Fax 0032 (0)2 227 6441

[email protected]/europe

Further copies or alternative formats can be requested from:Tel 0870 444 5841 Email [email protected]

or visit www.nhsconed.org/publications The NHS Conederation 2011.

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