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Gain share agreements – a positive step to drive change in the NHS

  • 13th March 2017

Gain share agreements – a positive step to drive change in the NHS

"One can choose to go back toward safety or forward toward growth. Growth must be chosen again and again; fear must be overcome again and again." Abraham Maslow, Psychologist

As you may be aware, earlier this month, when I was working with a GP federation in the Midlands, I managed to secure them a gain share agreement from the local CCG.

For those who don’t know, a gain share approach is a way of sharing risk between a CCG and a provider, where any planned savings are shared at an agreed percentage between each organisation. If the federation can agree this as a principle, it should then be confident that this approach encourages collaboration between the CCG as a commissioner and the federation as a provider, in order to identify savings and then work collaboratively to achieve them.

My sense is, if you get this in place, a federation can then engage its membership on the basis that a small percentage of the savings will be used to pay for the work needed and the remainder invested in new services within the Practices. If you reach the point of providing new services, it then becomes about facilitating new patterns of service provision and new models of service delivery, which drive efficiency that can then be reinvested in further service development.

Clearly the process needs the right balance of incentive tied to clinical quality and improved patient outcomes, to ensure you don’t simply incentivise savings. However, I am confident that this can be achieved through collaboration between Federation and Member Practices, and then between Federation and the CCG. Furthermore, if agreement can be reached to share identified and planned savings 50:50, with additional agreement on how savings can be used, this project can be commenced immediately a contract is agreed. 

Indeed, if you can agree an approach with the CCG where Federation savings can then be invested in new services provided by the Member Practices/Federation, which further develops the federated model, this should be the catalyst most Federations need for securing engagement from the Member Practices and then to securing the future of the Federation.

In my work I have found it straightforward to identify savings, normally by working with Medicines Optimsation teams and reviewing the variation in prescribing habits between Practices. Clearly you will not achieve 100% of the changes suggested; however, I am confident you can achieve a majority and keep the patients on board with you, simply because everyone is aware of the need for efficiency in the NHS and reinvestment of any efficiency gains in the NHS itself.

If you were to build upon this, over the next 12 months the Federation and the CCG would then be able to reinvest their share of the savings into new projects. This has the added benefit of the further cost effectiveness of delivering these services in General Practice rather than referring them to Secondary Care.

For those interested in knowing more please make contact. No two gain share agreements I have been involved with are the same, nor are the services into which the savings have been reinvested. What they do have in common, though, is the ability to first transfer the care from in hospital to out of hospital care and then, through the federations, transform the delivery – normally onto a hub and spoke basis to avoid unnecessary duplication in service provision.

As I have highlighted a number of times, the key in developing an MCP or PACS is that there are numerous basic services (if you want a list please email me) that can easily be shifted from in hospital to out of hospital delivery. By generating efficiency through a gain share and then investing it in to this type of service, you can start to drive a change in the way Practices engage and work at scale.

In most parts of the country the local GP federation badly needs a catalyst; a gain share agreement is one way to provide that catalyst. The reinvestment in services further underpins that by building a platform for changing the way practices work together, through hub and spoke, underpinned by inter practice referral.

The goal of achieving one, high quality and standardised approach without unwarranted variation, is deliverable through these projects, which provides a platform for the larger and more complex system-wide changes required.

If you are thinking of developing an at scale provider organisation, or about delivering any form of change, or you would like to know more about any of the business cases we have for service provision, and would like more information on how BW Medical Accountants can support you, or to arrange to speak to one of our experts please contact enquiry@bw-medical.co.uk or call 0191 653 1022.

Additionally, if you should have questions for us please email rachael.mackay@bw-medical.co.uk and we will do our best to answer these within the blog.

Who writes this?

Scott Mckenzie

Scott Mckenzie

NHS Management Consultant / Working at Scale
Find out more about Scott
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