Customer Insight – Investor Foresight: Market Making in Healthcare

A recent blog by the estimable health economist at the Kings Fund Dr John Appleby on PCTs and managing markets pointed out that in the recent World Class Commissioning external assessments, most PCTs scored poorly on competencies around stimulating the market and market management.  That rings true for my corner of South West London. I’m long enough in the tooth to remember when what we now call commissioning was just “purchasing” replete with shopping trolley analogies.  We’ve come some way since then, but still have a long way to go to get to the stage of being real market makers able to shape services (and more importantly provider behaviour) towards outcomes that do something positive about narrowing health inequalities and improving the health status of individuals.

To do that we need to move beyond commissioning in terms of how we describe what we are really seeking to achieve.  As “purchasing” was overtaken by “commissioning”, so the next iteration of the art should be  “health investing.”   After all £450m is no mean sum to have at our disposal annually. We should be able to do something creative with it to make things better for our 300k+ people who use services in our borough.

Just buying the same old, same old from the local providers won’t change things much.

As John Appleby says: “The fundamental question for PCTs is how, having identified their population’s health care needs and decided on priorities, they use their purchasing position within the economic framework of the NHS to get value for patients. “

There has been a spate of helpful “how to do it” guides for market management from perhaps not-too-disinterested management consultancies.  These are all welcome – we have to start learning somewhere -  but the best way I think is to learn market making by doing it.  Perhaps that makes me a radical empiricist in my approach to market stimulation. I’ve just finished being part of the procurement team for our GP Led Health Centre at Clapham Junction and am now part of a team getting to grips with potential providers keen to help us do something about our scary childhood obesity problem.  Everyone involved is on a rapid and time-hungry learning curve.  Without doubt, sharing this experience within the PCT and with our local authority commissioning partners is building our competency as market makers and market managers in a very practical way.

Obesity and other “lifestyle-related” services was an area identified by external consultants as ripe for market stimulation and open procurement.  Now that we are doing just that, I’ve been amazed by the number of quality providers from inside and outside the NHS who say  – at least on paper, the real test comes in eyeballing the short listed candidate providers – that  they want to work in this new way to address the outcomes we are seeking to achieve.    If we become competent health investors we can have competition for the market and also competition in the market.  That should give us much increased flexibility to address the health and well being needs of our diverse population and provide expanded choice amongst services.

PCTs must be smart health investors.   Like any successful business -  especially one looking to survive and prosper during the economic downturn - we must have good customer insight (intelligence from user experiences, learning from user and public involvement, complaints etc).  But insight is not enough. We must learn to join up this insight with investor foresight (our aspirations and expectations, market intelligence about demand, provider capabilities and potential etc).  Putting these two things together is the only way we will be clear about what journey we are taking and -  crucially –  whether our local population is with us on the same journey.  We cannot simply assume everyone is going to the same place just because we have a strategy document about it.

One way to start getting to grips with being a smart health investor is to use an excellent new tool developed by David Gilbert and colleagues at InHealth Associates for the Department of Health -  the “Engagement Cycle” The first thing I would like to use the Engagement Cycle for in our PCT is to audit what we think we know about user-focused views in our commissioning strategy.

I’d like to be assured on these points: How robust is this intelligence? How are we relying on it in our current plans reflecting the NHS operating framework?  How are we refreshing, extending and communicating our customer insight and translating it into future commissioning plans?  Where is user-focused intelligence helping us to go as a health investor? Is everyone on the same journey?

To have insight, you first have to have the right data from your customers. If you aren’t sure what customer experience information (CEI) is, how to get it and what to do with it, PriceWaterhouseCoopers have provided a helpful guide to CEI in health and social care. Then its a question of rolling up your collective sleeves and getting to grips with learning the health investing business.  I guarantee you will not be bored.