In this opinion piece David Guest explores some of the thinking behind the recent trend to commissioning of health services in Australia.
To market, to market went my brother Jim
When somebody threw a tomato at him
Tomatoes are soft and they don't bruise the skin
But the one killed Jim was wrapped in a tin.
Although the Turnbull government has been returned with a slim majority, it now has the mandate it needs to continue its structural reform of the Australian economy. Informed customers choosing goods and services from providers in an open and competitive market place where innovation is fostered will maximise economic utility and lift productivity. This newly invigorated market place will apply to government services, including health, as well as to private industry.
The Harper Review of Competition Policy was a Coalition 2013 election promise. In receiving the report in 2015 the Federal Treasurer, Scott Morrison, agreed, "Effective competition encourages businesses to pursue efficiencies, rewarding the most innovative and dynamic that provide the best services at the lowest cost. It also benefits households by giving them more and better products and services to choose from at lower prices." The government rejected none of the 56 recommendations, accepting 39, partially accepting 5 and leaving 12 open for further review and consultation.
Recommendation 2 addressed Human Services and noted that;
"Each Australian government should adopt choice and competition principles in the domain of human services.
Guiding principles should include:
- User choice should be placed at the heart of service delivery.
- Governments should retain a stewardship function, separating the interests of policy (including funding), regulation and service delivery.
- Governments commissioning human services should do so carefully, with a clear focus on outcomes.
- A diversity of providers should be encouraged, while taking care not to crowd out community and volunteer services.
- Innovation in service provision should be stimulated, while ensuring minimum standards of quality and access in human services."
Many of the areas examined in the Review are State or joint State/Commonwealth responsibilities. Like its Federal counterpart, the NSW government has also embraced commissioning stating, "Increased competition and innovation in public service provision can deliver significant benefits, and NSW believes that strategic commissioning is the most effective way to realise those benefits (such as achieving better value for money while improving service quality, creating contestability and incentives to innovate, and increasing accountability and transparency)." The NSW Treasury has established a Commissioning and Contestability Unit to further this approach within the public service.
Some have been concerned that the commissioning framework has not been well understood by the public service. Federal and State Departments have been busy in the last 12 months explaining the concepts and debating the ramifications. Proponents emphasise that commissioning is not simply the outsourcing of traditional government services but entails continuous review of the marketplace's needs, services and the quality of those services.
The Treasurer has asked the Productivity Commission to look into which human services should be selected for the new approach. The suggestion that the Commission would identify areas currently covered by Medical Benefits Scheme was the partly the basis for the Labor Party's claim the government was considering privatising Medicare.
Such a claim was premature since the Commission is not due to report until September 2016. Nevertheless, the general thinking from the Productivity Commission can be found in their April 2015 paper, Efficiency in Health. Areas that affect primary health include:
- the reform of the PBS and MBS schemes (the Robinson Review),
- dissemination of evidence-based guidelines for clinicians (e.g. via Health Pathways or Map of Medicine),
- expansion of the roles of health care workers and their reimbursement under the MBS,
- allowing greater involvement of private health insurers in preventitive health and co-ordinated care,
- promoting the more efficient use of electronic health records,
- releasing more data on the performance of individual health care facilities and clinicians.
The Horvath Report restructured the Labor Party's Medicare Locals into Primary Health Networks. These PHNs were geographically aligned with the boundaries of the State governments' Local Health Districts. Being locally based and more attuned to the activities of the LHD, the PHNs are in a better position to evaluate local health problems and solutions than the Health Department in Canberra.
The new model of commissioning has thus fallen to them. The PHN commissioning framework envisages a process of:
- needs assessment
- planning
- designing and contracting services
- creating a supply structure (where needed)
- managing the suppliers' performance and evaluating the outcomes
It then repeats the process in a cycle of continuous improvement.
Mental health commissioning will be one of the first areas for the North Coast Primary Health Network to address. The details have yet to been released but may incorporate many of the principles described above with organisations competing for the contract to manage clients and devolving management to the lowest level of clinical competency. If successful, other services will undergo the commissioning process.
With the drive towards efficiency and value, the Primary Health Network, as a commissioning body, will have come a long way in 20 years from its origins in the Northern Rivers Division of General Practice. It may well have a difficult time balancing its traditional roles of supporter and facilitator in primary care with its new one of commissioner and arbitrator.
There has never been a more exciting time to be an Australian general practitioner or patient or even a Primary Health Network.
