Healthcare delivery
The importance of correct coding for NHS payments
In light of the call for a return to activity-based payment mechanisms, Trusts must focus on one crucial area: accurately coded data. Adrian Jones explores how correct coding will be key to maximising NHS income, ensuring proper payments under future activity-based models, and facilitating crucial reforms in line with the 10-Year Health Plan.
Lord Darzi’s Independent Investigation into the National Health Service in England generated plenty of headlines, and has since been followed by the launch of the 10-Year Health Plan. The eminent surgeon and former Labour health minister concluded that the NHS “is in serious trouble”; although he also argued the service has “strong vital signs” and can recover with the right “repair.” One area for “repair” that should have received more attention than it has is the payment mechanisms the NHS uses. Lord Darzi points out that “over the past decade there has been a significant shift away from activity-based mechanisms,” such as Payment by Results, in favour of block contracting. His report suggests this may have hit productivity. With block contracts, providers are funded for their efforts rather than their outputs,” he writes. “It is perhaps not a coincidence that the drop in clinical productivity metrics for the urgent and emergency pathway is nearly double that for outpatients and elective surgery, since it remains on block contracts,” (while non-elective care hasn’t).
Aligning policy and financial flows and incentives Lord Darzi is not the only NHS leader interested in financial flows and incentives. Health and social care secretary, Wes Streeting, seems to be aware of the issues. In post-Budget comments, he told the BBC: “We have got to improve productivity – and ask some hard questions about where money goes in the system.” In an earlier article for the Health Service
Journal, he mused that: “Some would like a return to more activity-based ‘payment by results’ tariff, and the idea of extending this to preventative care interventions has been floated.”
Accurate coded data Before we consider what changes the policy makers tasked with responding to the
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investigation might consider, it’s worth noting that any payment mechanism requires good data. In healthcare, that means accurately coded data. Prior to COVID-19, Acute Trust drivers for
accurate clinical coding were to ensure their activity, income, and performance indicators - such as mortality rates - were correctly reported. In particular, these relied on the accurate recording and coding of patients’ chronic conditions and comorbidities. During the pandemic, when more money went
into the service and more of it was distributed through block contracts, there was less focus on the link between coding and income. However, this has become important once again with the reintroduction of activity-based payments to incentivise hospitals to reduce waiting lists. What many Trusts have found is that the
depth and accuracy of their coding has declined. Indeed, some are finding their data suggests the complexity case mix of their patients is less now
than they were before COVID-19 - which is very unlikely to be the case. The accuracy and depth of coding may have
declined for a number of reasons. During the pandemic, clinical coders shifted to working from home and many have never returned to the office – if they still have an office and their Trust has not repurposed it as clinical space. Working from home isn’t a problem in itself,
but clinical coders may not have access to all the systems they would have on site. Instead of working from a full set of notes, for example, they may be working from a discharge summary – and there are well-known issues with the timeliness and completeness of discharge summaries across the NHS. There has also been a change in electronic patient record systems. The Frontline Digitisation programme is moving Trusts from paper and first-generation systems to full EPRs. This should deliver benefits to clinical care and flow, but it can take Trust teams time to adjust and find the data they need.
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