Having service line reporting (SLR) is a Monitor requirement for all trusts wishing to achieve Foundation Trust status. One of Liverpool Heart and Chest Hospital's (LHCH) key strategic objectives was to implement SLR via a patient level information and costing system that would ultimately add value and improve patient experiences.
The Trust engaged the clinicians and finance team to improve financial management through more detailed activity based costings. This led to better informed business decisions and the improvement of patient experience by standardising clinical pathways based on best clinical practice.
Following a tendering exercise, the Trust purchased an information and costing system. There then followed a series of meetings with staff at all levels across the organisation to identify both clinical and financial requirements to customise the system to account for the uniqueness of the cost and income structure of LHCH.
Whilst HRGs and reference costs identify potential income, this system allows the Trust's costs to be allocated at a significantly higher level of detail, as well as identifying what the drivers of these costs are. Each patient episode was compared against the other to identify high cost episodes and understand why this procedure deviated from the norm. The system was piloted and refined throughout 2008/09 and went 'live' at the start of 2009/10 with quarterly reports provided to the Executive Team.
In its simplest form, the system will identify whether cost variations are the result of patient complexity or consultant practice. It is clinically led, risk assessed and supported by a robust system of peer review. An example of this in practice identified one cardiac surgeon using a double row of thoracic closure staples. A peer review of clinical outcomes found this was not required leading to an annual saving of over £35,000.
An independent review recognised LHCH as one of the leading NHS organisations in the country on the implementation of service line reporting and service line management. Other benefits included the introduction of a revised management structure with clinical decision-making being pushed down to a lower, more appropriate level and better integration of performance and financial management. In addition, the Trust is now developing a more robust financial model with a better understanding of cost drivers and potential efficiencies across different clinical areas.
Future developments will see the introduction of a bar-coded stock management system. This will 'charge out' consumables to individual patients, thus identifying variations in practice by individual consultants leading to greater standardisation and a reduction in costs. It will also optimise stock levels and improve the accuracy and robustness of the information available to the Trust.
LHCH is keen to work with other Trusts to enable benchmarking to be undertaken across similar organisations.