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Study to examine the impact and potential of costing at the patient level

16 October 2012

A new study to assess the impact of reporting costs at the individual patient level has been funded by the NIHR Health Services and Delivery Research (HS&DR) Programme.

Guided by the Department of Health’s Quality, Innovation, Productivity and Prevention (QIPP) programme, NHS organisations are working to improve both the quality and the efficiency of their service provision. For these challenging aims to be achieved it is vital that the relationships between current practice and costs are clearly understood and relevant information is made available to decision-makers.

One approach to providing this information has been through the introduction of Patient Level Information and Costing (PLICS). Adopting a patient level approach gives information on the resources used to diagnose and treat an individual patient.   This new `bottom-up’ costing enables managers to track activity across specialties and settings, following patient pathways.  This might include for instance patients with stroke or chronic respiratory problems who may need a number of episodes of hospital care as well as rehabilitation and community support.  

The detailed information available as a result of using PLICS should highlight any variations in costs between patients receiving the same treatment and give a clearer picture of where changes can be made to use resources more effectively.

This is a new form of accounting in the NHS and its use has not been formally evaluated.  Through researching acute trusts and those commissioning health services, the research team, led by Professor Sue Llewellyn of the University of Manchester, aim to discover what difference using PLICS has made.

Commenting on the project, Professor Llewellyn said: “Effective financial management has always been critical to the NHS, but as financial pressures increase, it will be even more so. PLICS can help ensure that finite resources are being used as efficiently as possible."

The survey will be followed by in-depth research at four sites to find out how PLICS can help in:

  • cost improvement;
  • better resource allocation in association with patient preferences;
  • understanding clinical variation and the relationship between cost and quality; and
  • enabling greater clinical engagement through more ownership of costs and information systems.

Professor Llewellyn added: “We hope to discover whether PLICS can be seen as a best-practice approach and develop recommendations for its future use.”

View more information about this project, commissioned as part of an NIHR HS&DR call for new research to improve financial management in the NHS.

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The NIHR Health Services and Delivery Research (HS&DR) Programme is managed by the NIHR Evaluation, Trials and Studies Coordinating Centre (NETSCC). NETSCC is part of the University of Southampton funded by the NIHR, with specific contributions from the CSO in Scotland and NISCHR in Wales and the HSC R&D Division, Public Health Agency in Northern Ireland.

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