Ever Decreasing Pools
Saturday/12/Jan 2008 Filed in:
Info - CommentaryCongratulations to all at the NTA and DH for getting this years Pooled Treatment Budget announcement out before the treatment plans were due in. Its a big improvement on last year when announcements of fairly substantial cuts were made after the closing date for final plans (see part one of my Review of the Year).
Despite this advantage, its seems that we peevish people out here in the drugs field just don't know when we're onto a good deal. The NTA press release told us that:
"The National Treatment Agency (NTA) welcomes the Government’s continued commitment to substantial investment in drug treatment, with Pooled Drug Treatment Budget (PTB) funding for drug treatment in 2008/9 being maintained at the 2007/08 record level of £398m. This, combined with local efficiency savings of £50m a year by 2010/11 means that the improvements made in the quality and availability of drug treatment over the past 10 years can be enhanced further."More information
Why then are people so unhappy?
Well essentially it boils down to three key reasons-
Firstly, that disarming phrase "local efficiency savings of £50 million a year" actually means spending cuts of £50 million a year. The funding is being held at £398 million for the next three years. No inflationary uplifts, no payments to meet the increasing cost of wages, premises or medication. Nothing either to meet the needs of a drug using population whose need for treatment seems to be increasing. Nothing extra to cover the costs of treatment for people coming out of prison, nothing extra to help families experiencing problems with drugs.
Secondly, the funding has been redistributed in a way that the NTA and the Department of Health claims is fairer. People in the field seem to disagree. Why the controversy? Well, what the NTA and Department of Health have tried to do is ensure that those areas that have been historically underfunded because of failings in the York Formula (more of which later) get enough money to meet their needs. However as the budget is fixed and shrinking - with no flexibilities and no slack - the only way they can do this is to take the money from areas that have had more. Its like robbing Peter to pay Paul. Or in this case robbing Sunderland to pay Dorset. If you need to equalise funding in a stream like this, the best way to do it surely is to peg areas that have - by your calculation, though of course this is debatable - too much money at inflation only rises, while increasing the investment in those areas that need more money. Simply because one area is underfunded doesn't mean that another is over funded.
The third reason people are fed up is that the formula used for calculating the allocations is less than transparent. Unusually for a government funding stream, the documentation that came out with this announcement was very sparse. Accompanying the press release was just a pdf of a spreadsheet in a tiny font. PTB allocations There were no guidance notes and no explanation of the formula that had been used to make the allocations. As I'm in the middle of preparing the next edition of the Guide to The National Drug Strategy I was really keen to know what lay behind this shift in funding, so I contacted the NTA to ask them. They told me that the allocation was made on the basis of
Activity - this is the number of individuals "in effective treatment" which means retained for 12 weeks or more or discharged successfully before 12 weeks. The NTA told me that this applied to 75% of the allocation.
Case Mix - the NTA and DH have identified that it costs twice as much to treat a heroin and or crack user than it does someone who uses a different kind of drug. So they pop a 2:1 differential in here - meaning areas that treat a greater proportion of crack and or opiate users as opposed to people experiencing problems with benzodiazepines or amphetamines will get proportionately more money. When I asked the NTA how they worked this out they said that it was combination of last years unit cost exercise which gave the cost of different intervention types, and then the use of the clinical guidelines to identify what treatment PDUs (ie people who use crack and or heroin) and non-PDUs (i.e. people who have a drug problem but who don't use crack or heroin) should receive. The NTA gave an example that the majority of heroin users will be in longer term prescribing services which "when costed averaged about twice as much as the majority of non-PDUs that were in shorter intervention services" Apparently some in the DH are claiming that this is taking drug services closer to individualisation and personalised services. Well, only as long as you don't mind being defined and siloed by the drug you use rather than the problems you experience and the person you are. I don't know what proportion of the allocation this affects - possibly the whole lot is weighted in this way as no proportion has been identified.
Caseload Complexity - 25% of the allocation will be determined by factors reflecting the complexity of the local treatment population. This threw me at first. Until the NTA told me that they were using the York Formula as a proxy for caseload complexity. The York Formula is a way of distributing healthcare funding that is based on health inequalities and deprivation (i.e. if the area is more deprived and has higher rates of certain key health indicators, they will receive more money). Sounds fair doesn't it, except remember that this is the way the Pooled Treatment Budget was distributed in the first place. The big question here has to be what do we understand of the correlation between scoring profitably on the York Formula and having a complex caseload? We know that deprivation is a big factor in aggravating substance misuse problems, but is it the only significant factor in making a caseload complex? Surely other issues such as environment, treatment quality, mainstream engagement, etc play a big role too? This accounts for 25% of the allocation according to the NTA.
Area Cost Differential - This is actually the Market Forces Factor (MFF) something developed in healthcare to measure the real difference in cost of providing one type of service in different areas. It was developed alongside what's called the tariff. The tariff is a cost that the Department of Health allocates to a particular treatment. The MFF is a multiplier that reflects the actual cost of things like premises, staff, equipment. Its used in Payment by Results. So for an example, say - Cranford has an MFF of 1.01 and performs 950 toenail abrasions in 2006. If a toenail abrasion has a tariff of £100 they will receive 950 x £101.00. Its actually quite a clever little thing - but varies from area to area - even within London. While its applicability to drug treatment hasn't been tested, its probably reasonable to assume that drug treatment is going to be subject to pretty much the same variations in staff cost and premises costs and equipment costs as - well - as toenail abrasion. Again I don't know what proportion of the allocation this affects - maybe again its 100%? King's Fund - Market forces factor
I guess what's most striking about this is not so much what it includes, but what it doesn't include. There is no account taken of a number of factors which I would have thought had an influence on the need for investment in drug treatment. Firstly, no account is taken of prevalence - except insofar as prevalence is reflected in number in treatment. Given the variation in penetration rate nationwide (penetration rate is the proportion of the drug using population said to be in treatment) this is probably an assumption too far. No account is taken either of the size, nature or impact of the local drug market, levels of crime and disorder, or even levels of blood born viruses. For example, London has the highest rate of blood born virus infection among injecting drug users in the UK. Yet London loses over £12 million through this allocation. No account is taken through this formula of the quality of drug treatment or the performance of the local partnership - factors that massively affect whether people come into treatment or not. The issue that seems to interest the public most - that of successful treatment outcomes - is ignored here completely.
In a number of informal meetings, the NTA have said that partnerships can get more money if they do better. But given the fact that the budget is limited its hard to see how this can happen without constantly moving the goal posts. You see if area A starts to see loads more drug users, but area B still sees the same number of drug users, area A can only get more money if area B gets less. So area B has to get less money even though its seeing the same number of drug users. So the amount per drug user that the NTA and DH see as an optimum spend will have to change constantly if any performance measures are to operate. Maybe this is what we will come to mean by flexibility?
Alongside all this, new guidance for the Treatment Plan has been published. Adult drug treatment plan 2008/09. Guidance notes. I've not had a chance to go through this in detail yet - more when I do. But I did just notice one rather significant thing. That's the fact that from being an allocation that came through to PCTs to pay for drug treatment, the Pooled Treatment Budget has now become a pot of funding from which local partnerships must seek funding. That's quite a change - almost from allocation, to grant - in the opposite direction to the way everything else in Government is travelling.
So what are the consequences of this likely to be? A number of people have been discussing this as you would expect. Some see real problems for those areas whose budgets are being dramatically reduced over the next three years and have suggested that in fact services will shut down, staff will lose their jobs and communities and individuals will lose out. Addaction, the first of the big providers to comment on the shift in spending have said:
“There are more losers than winners under the new funding arrangements .... As existing contracts have an inflationary increase built in, services in areas where funding has been cut will be under real pressure to meet the needs of drug users.”More losers than winners
Certainly in London the impact will be felt rapidly - with services needing to reduce costs but retain numbers just to keep afloat. Other areas where increased investment was just starting to bring about improvements will need to slow those improvement programmes down. Voluntary sector providers are likely to feel the pinch first as the NHS family tries to help out the statutory providers by for example revisiting aggregated contracts - though this may impact on clarity for commissioners and therefore quality for service users.
On the positive side (see I AM trying ...) more commissioners may be forced to work more creatively. For example they may want to look at the economies of scale which would come with cluster contracts and services covering more than one borough.
Others have commented that the creation of a system of two tier funding for "PDUs" and "non-PDUs" may incentivise "methadone banking" - the process whereby people are kept on long term methadone scripts in the interests of the service or the DAT rather than the service user. Looked at from one angle, the new system would seem to incentivise keeping people IN treatment rather than helping them move on. Certainly there is no incentive for a DAT to move people out of specialist treatment - because all that will happen is that their budget could be cut. Clinicians have pointed out that pressure to exclude people who don't fit into the new PDU box may result in people experiencing worse problems and getting less help with drugs like amphetamine (including methamphetamine), cannabis, ecstasy and benzodiazepines.
I guess I think its been a kind of almost noble last ditch effort to get it right - and I'm most grateful to the NTA for their clarification of some of the issues. But in the end I can't help but feel that just at a time when DATs and services really needed to be able to get round the local table and start mixing it with the mainstream services they're actually being pushed further out into the wilderness. As the agenda is being set locally for every other service within the LAA no one is likely to show any interest at all in a policy area in receipt of a tiny and shrinking ringfenced budget for which they have little or no accountability through the only performance framework that matters - the local one. Putting a ringfence around an increasing budget may be one thing, but reinforcing one around a minority interest policy area with a shrinking one is a completely different matter.
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Tags: Drug Treatment, Pooled Treatment Budget, NTA