What are the challenges for health reform? (The long answer)

Plans for health reform were subject to some road-testing at a two-day simulation event in Canberra this week, convened by the Australian Healthcare and Hospitals Association.

The simulation was facilitated by Chris Spry, a former NHS executive who has previously conducted similar workshops in the UK, with the aim of identifying issues surrounding implementation of the reforms.

It was attended by a diverse group that included hospital managers and clinicians, senior health bureaucrats past and present, people from Divisions of General Practice and Medicare Locals, consumer representatives, researchers, consultants, and community sector representatives. Participants included former Federal Health Minister Dr Neal Blewett, former NSW Health Minister Dr Andrew Refshauge, and one of the “architects of Medicare”, Dr John Deeble.

To my mind, there were some important omissions from the guest list, but more on this later.

On the first day, participants organised into various groups – Medicare Locals, Local Health Networks, national agencies, health departments, COAG etc, and asked to act out different situations.

Some of the key themes were:

• More clarity is needed about the detail of the reforms.

• There is a critical need for proper support for Medicare Locals and Local Health Networks.

• Data collection and sharing should be tailored around the needs of the users, especially of clinicians and services wanting to use it to drive quality improvement.

• The importance of the personal electronic health record as the glue to reform implementation.

• The need for Commonwealth bureaucrats to get a better understanding of the realities of health service delivery, and to develop better working relationships with states and territories.

• There should be consistent national collection of patient feedback.

“The biggest lesson that emerged out of the simulation was the need to be serious about providing support to implement the reforms,” said Prue Power, executive director of the AHHA. “If we don’t do that, the status quo will prevail.”

What follows is a general account of some of the issues that emerged, grouped into:

• The vision – and the reality check
• Some general points
• What/who was missing

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The vision and the reality check

Vision: Evaluation is built into the reform process
Reality check: Currently no stated plans to do this

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Vision: Governments will work together to improve health outcomes for all Australians and to ensure the sustainability of our health system. Each state and territory will have regular meetings with its Commonwealth counterpart in health services and the community across the country, and will support the development of constructive working relationships between Local Health Networks and Medicare Locals

Reality check: Many observers believe relationships between federal and state bureaucrats are verging on poisonous, and not conducive to the collaboration that will be required to finalise and implement the reforms. They rarely meet face-to-face. If bureaucrats aren’t working well together, how can the Local Health Networks and Medicare Locals be expected to do so? One participant commented that governments can work together, no matter their political colours, if there is trust. “But trust needs to be worked on every day at every level, political and bureaucratic.”

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Vision: There will be a national system for promoting service improvement around care models at the local level.

Reality check: There is a sense that the reforms are getting lost in technical, governance and territoriality-based disputes, and losing sight of the purpose of the reform agenda – to move to a more integrated system based around populations, communities and patients. As well, the current culture does not make innovation easy; as one hospital clinician said: “Health administrators are into funding, targets and staying out of the newspapers, so very talented and creative people can’t work outside of that paradigm – they can’t be leaders, they’re managers.”

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Vision: A financing system that provides incentives for patients to receive quality care in the most appropriate setting, whether the community or a hospital. Financing arrangements will provide incentives to encourage innovation. Hospitals and community-based services will share in any savings achieved, for example, by reductions in hospital admissions.

Reality check: These goals will be difficult to achieve under the arrangements now on the table. There will only be money for innovation if current services are cut. There is a lack of flexibility in the proposed funding arrangements. There are also concerns the arrangements proposed under the Independent Hospital Pricing Authority will create perverse incentives, including encouraging hospitals to treat people in hospital who could be better cared for in the community. They may also exacerbate inequities; for example, the Commonwealth is only required to grow hospital funding in proportion to the degree to which the state grows them. So Tasmania, with limited opportunity for funding growth, might end up relatively worse off than WA, for example. Meanwhile, one hospital intensive care clinician said: “Many of our patients are in the last 3-6 months of life. it’s a cruel place to be; it’s an expensive place to be… It’s inappropriate to put low acuity people in high acuity place like a hospital. Many people would rather be treated at home.”

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Vision: Community and health service funders will have equal access to reliable and relevant data about the performance of health services to drive improvements in quality. Agencies share data so they can identify perverse incentives early.

Reality check: There are many barriers around collection and sharing of data that have yet to be resolved. Data needs to be collected and shared in a way that suits needs of users at a local level (services, clinicians, community).  There are concerns that services will be subject to data collection overload if the multiple agencies requiring data collection do not streamline their processes.

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Vision: Wherever possible, decision-making about how money is spent and what services are provided should be made at the local level. In the longer term, there could be trials of regional-based aggregation of funding, for example pooling of PBS and MBS funding.

Reality check: There are concerns that reform will impose top-down models rather than the bottom-up approaches that are more likely to lead to real change.

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Vision: The Commonwealth, states and territories will ensure that the Medicare Locals and the Local Health Networks are well supported. A team of experienced health service managers will be developed at the national level to support Medicare Locals and to ensure that the skills and experience of the first tranche of Medicare Locals are shared across the sector. The States and Territories will similarly support the Local Health Networks.

Reality check: The level of support that will be available to Medicare Locals and Local Health Networks is not clear.

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Vision: A national program will be established to develop the capability and competency of health service managers and clinical leaders to work effectively in the new environment.

Reality check: There are concerns about the capacity of the health system to drive the changes. It is difficult for a large complex system to manage major change when it is already very busy. Several comments were made that Commonwealth bureaucrats lack understanding about how the health system works. It was noted that Victorian health bureaucrats, by contrast, had been on “clinical placements”, to follow around clinicians and learn about the system.

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Vision: Funding incentives will encourage Medical Locals and Local Health Networks to collaborate, for example in data sharing, education, research, and advocacy. This could also include developing some joint approaches to developing a better understanding of consumer experiences, including whether the electronic health record is making a difference to care.  Medicare Locals should be given as much autonomy as possible, particularly during their start up phase, to be experimental and innovative.

Reality check: There will be many tensions and challenges for relationships both between MLs and LHNs and within these organisations.  On one hand there is a sense that Medicare Locals will be out-muscled by LHNs. On the other hand, LHNs are subject to states’ approval and capped budgets, while ML providers operate within uncapped framework of MBS and PBS. Challenges for MLs include: lack of population health planning expertise, difficulty of balancing the need for collaboration with competition inherent in largely private sector of community, a lack of technical skills that will be required if they are to become service purchasers, and complexities of governance. For example, if Medicare Locals become purchasers of services, what should the role of service providers be in governance? Another potential source of tension: if a ML decides prevention represents better investment, that may represent a direct threat to those with a vested interest in maintaining current service structures.

As one participant said: “Medicare Locals are going to be like the little mouse that roared, compared to the big powerful LHNS.  The DOHA people are treating them like they’re going to be passive regional offices. They run the risk of being so big that they disengage GPs but too small to be an equal partner with an LHN.”

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Vision: Patients should have a single point of access to a range of services, for example via 24-hour telephone services. In a few key clinical areas (eg chronic care, mental health, maternity care), there would be pathways for patient care, with fairly clear protocols about what would happen for a patient with a particular condition, underpinned by the personal electronic health record. There would also be more of a focus on self-management.

Reality check: One of “the big black holes of the reforms”, one participant noted, is that private specialists have not been engaged, despite their role in managing chronic conditions. Incentives are needed to encourage private specs to get out of their offices and work in a shared care model. GPs and specialists need to be provided with incentives around the personal health record.

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General Points

• Health reform is so complex, with so many details still be thrashed out, that even the well-informed crowd gathered for the simulation had quite different understandings of the state of play. “It’s so complicated and the rules keep changing all the time,” said one participant.

• One major challenge for the reforms is what seems to be a fairly widespread sense of disappointment and cynicism among those charged with implementation, as per the comments below:

“It is yet to be seen whether there will be changes in efficiency, quality or outcomes. We live and hope that there will be.”

“What started as a dream to make a significant impact with vision has frittered away to being at the margins…”

“It does look a lot like shuffling of deck chairs.”

• Crises can be an incubator for innovation. It was telling that the workshop participants were most motivated to develop a new, consumer-focused model of care when consumer groups, MLs and LHNs were charged with working together to develop ways to tackle a funding cut.  By contrast, when a group of hospital managers faced the same funding cut, they responded as they always do – by cutting services, staff and finding new revenue streams, for example by bumping up their privately insured patient numbers – rather than with service innovations.

• One major challenge to the setting of a fair, efficient or average price for hospital network services is that the cost of nursing services varies significantly between states. Will the health reforms lead to pressure for a national nursing award?

• Darlene Cox, Health Care Consumers Association, said that although there “is not a lot of reform in the health reform package”, consumers could expect to see some service improvements arising from consumer and community involvement in the governance of MLs and LHNs.

• AHHA is setting up a consultancy arm to provide expert advice to Local Health Networks and Medicare Locals (and other interested health organisations), particularly around governance, organisational improvement and activity based funding. Get in touch with them if you’re interested in being involved.

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What/who was missing?

Prue Power was pleased with the work of the two days and told Croakey that she thought Medicare Locals and Local Health Networks could also benefit from doing such simulation exercises together.

My sense was that most participants seemed engaged in the process – quite an achievement considering this is a crowd that is regularly subject to death by workshop and might be suffering from that debilitating syndrome known as health reform fatigue.

One of the participants, Bob Wells, a former federal health bureaucrat and now director of the Menzies Centre for Health Policy at the ANU, said the process of the simulation highlighted the need to bring fresh thinking to longstanding problems, to stop it being about the same old players engaging in the same old dance. “We need a new dance,” he told Croakey this morning.

He also observed that the simulation process revealed how there are “two worlds of health policy”, with the Medicare Local and Local Health Networks getting on and doing their own thing without wanting to engage much with the groups of bureaucrats at the workshop.

“I always had that feeling that there are two dimensions of health policy – one is the real world, where people just get on and do things, and then the silly world of bureaucratic health policy which is really just a big dance with set steps,” he said. “The latter doesn’t really influence the former.

“It just brought out in stark relief that we are past people like me being useful to solve these problems. We need other people to take the lead of trying to get new ways to do it.”

If other groups do plan such exercises, I hope they have a stronger focus on population health and equity; I was left with the impression that health reform is really about health service financing rather than population’s health, that the tail is wagging the dog.

Altogether missing from the discussion was how the Gov 2.0 agenda and social media have the potential to transform health care and reform.

They could help with so many of the problems identified during the workshop, and could be used to support innovation, creativity, collaboration, community engagement and participation, communication, sharing of data and ideas, and the building of relationships. They can help break down hierarchies, shine lights in the dark corners, and challenge the status quo.

I hope there are no more meetings like this without a conscious effort to engage Gov 2.0 and social media experts.

It could have been useful, for example, to have a Twitter feed from the simulation, engaging AHHA members and wider health sector and community in some of these discussions.

Sure, it would have been confronting, challenging and potentially risky. But it would almost certainly have been enriching and productive – and brought some other voices, perspectives and experiences into the frame.

As it was, there was very little Twitter activity to report, apart from the below.

• Declaration: I attended the workshop as an invited participant. The AHHA paid for my travel/accommodation expenses.

• Stay tuned for the next post: Is primary health care an earlier adopter of social media than the hospital sector?