NHS needs stronger incentives to reduce preventable hospital admissions for people with chronic diseases, says The King's Fund

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Stronger incentives are needed to encourage hospital and family doctor services in the NHS to manage the health of patients with chronic medical conditions more effectively in the community and reduce the need for preventable and expensive hospital treatment, says a report from The King's Fund published today.

Managing Chronic Disease: What can we learn from the US experience? examines the success of some parts of the American health system in treating patients with chronic medical conditions, such as asthma, diabetes and heart disease. The report indicates that some incentives that exist in the US health system - for example the use of competition for customers between organisations that commission health care - can contribute to good quality care, greater patient satisfaction and fewer people needing hospital treatment than in the NHS. It calls for an urgent review of financial and non-financial incentives in the NHS to improve the health of people with chronic diseases so that the risks of hospitalisation are reduced.

One approach would be to offer financial incentives to encourage specialists and primary care staff to work together to reduce preventable hospital admissions. The report also highlights the need for fewer central and more locally determined targets to be agreed between clinicians and managers and more efficient ways of identifying patients most at risk of ill health and hospitalisation.

The King's Fund chief executive Niall Dickson said:

'Government policies and targets, such as introducing market-style incentives for hospitals, have been designed mainly to tackle waiting lists, not for patients who are frequently admitted as emergencies for longstanding illness. The incentives for the NHS to improve the care of people with chronic diseases are not fully developed, but this needs to happen as a matter of urgency.

'What we now need is a national approach to help people with chronic diseases, their carers, and the NHS manage their conditions more effectively in a way that goes beyond existing policy. This is crucial. Chronic diseases are among the costliest for the NHS to treat and affect around 17 million people in the UK, let alone their carers and families.'

The report is based on a study of five relatively high-performing organisations in the US in the care of people with chronic conditions, and concludes that there are useful lessons for health care in England. It says the incentives in the US health system, under the right circumstances, helped to focus the minds of American managers and doctors on the needs of patients, and proactively to target and treat patients most at risk of future ill-health. This, the report argues, is in sharp contrast to the frequent conflict in goals between NHS doctors and managers, the strong focus of national policy on waiting lists above chronic care and the lack of incentives in the NHS to reduce preventable admissions, which often results in reactive and ad hoc care.

However, the report also counselled caution in adopting US systems wholesale. Report author Jennifer Dixon, The King's Fund health policy director, said:

'Primary care trusts (PCTs) have significant advantages over US health care organisations in trying to improve chronic care as they have national strategies, targets, investment in the shape of national service frameworks, and a relatively stable population of patients. While our study shows there is much that we can still learn from other countries, the US system is clearly very different to our own. Market incentives can, as we have found, help to prompt good quality care, but they can also act perversely. For example, the investment in the longer-term good health of patients can be sacrificed for short-term gains. The government must therefore tread carefully when cherry picking ideas from the US and transplanting them here."

Read the report: Managing Chronic Disease: What can we learn from the US experience?

Notes to editors

1. Managing Chronic Disease: What can we learn from the US experience?, by Jennifer Dixon, Richard Lewis, Rebecca Rosen, Belinda Finlayson and Diane Gray, is available priced £8 from The King's Fund on 020 7307 2591, or by visiting www.kingsfund.org.uk/publications.

2. The report is based on a study of how five relatively high performing managed care organisations commissioned care for people with chronic conditions. Each was visited in 2003 by a team from The King's Fund to identify as far as possible the factors associated with good chronic disease management. Data were collected from each site using semi-structured interviews with senior staff, grey literature, visits to clinical facilities and contacts with practising clinicians.

3. The Department of Health is already funding a pilot project modelled on US healthcare provider Kaiser Permanente to help cut hospital admissions, and another major managed care organisation, United Health Care, to help cut hospital admissions in 18 PCTs in England.

4. The King's Fund is embarking on development work with selected PCTs in London to help them improve the care they give to people with chronic conditions. We are working with three PCTs in West London, one PCT in South East London and with North East London Strategic Health Authority to design and implement an intervention to enhance existing efforts to manage people with chronic disease. The pilots will be based on best practice lessons from the UK and US, and will take into account current initiatives in the UK health care environment.

5. For further information, interviews with the author or review copies, please contact Daniel Reynolds in The King's Fund media and public relations office on 020 7307 2581 or 07831 554927, or Michael Moruzzi on 020 7307 2585.