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Enhancements in National Tariff Pricing: Benefits and Framework for NHS Providers

This document outlines the National Tariff framework, emphasizing the shared responsibilities in price setting between NHS England and Monitor. Key roles include the design of currencies, regulated prices, local modifications, and pricing methodologies. By maximizing efficiency and signaling financial implications, this approach aims to influence behaviors among commissioners and providers, ultimately improving patient outcomes at lower costs. The timeline and ongoing reviews for urgent and emergency care highlight the need for responsive models that address local population needs while maintaining service coverage.

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Enhancements in National Tariff Pricing: Benefits and Framework for NHS Providers

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  1. The National Tariff Ric Marshall Director of Pricing www.monitor.gov.uk

  2. 2012 Act splits price setting role between NHS England and Monitor NHSE leads on: Monitor leads on: • Scope and design of currencies • Variation rules to National Tariff currencies • Pricing methodology • Regulated prices • Local modifications • Rules for local pricing and non-tariff pricing Close working and agreement

  3. Monitor’s Price Setting Role Our price setting role has potential to bring significant benefits to patients • Tariff setting not just a method for allocating funds: • Signalling financial implications of decisions can influence behaviours of commissioners and providers… • …and, in turn, improve quality of outcomes for patients at the same or lower cost

  4. 2014/15 National Tariff

  5. Not all prices use a National set price…. • Local determined prices are: • Local modifications – increases in national prices for services that are uneconomic for structural reasons, which must be approved by Monitor • Local variations – adjustments to national prices or currencies that are agreed by providers and commissioners, and must be published • Local prices – locally negotiated prices for services that do not have national prices, including some services with national currencies • Must adhere to the rules set out in the 2014/15 National Tariff • Prices for ambulance services contracted by commissioning organisations will follow these rules

  6. Patient Level Costing

  7. Reviewing Urgent and Emergency Care • Monitor is currently reviewing models of payment for urgent and emergency care • Early Findings: • High levels of fixed and semi-fixed costs regardless of demand because of required capacity – reducing demand doesn’t reduce costs • Variety of cost structures across the components of urgent and emergency care • Emerging Themes for Reform • Better coordination across providers to improve outcomes • Earlier intervention to reduce demand for emergency care • Recognition of the need to maintain a level of coverage and the fixed costs associated • Local discretion to design models that are responsive to the needs of local populations • Improving quality of data

  8. The Pricing Timeline Early 2014 Spring 2014 Summer 2014 Autumn 2014 Draft long-term strategy for payment design Policy Forward Look Final long-term strategy Payment system • National Tariff Document for 2015/16 • 2015/16 National Tariff Methodology Discussion paper • Tariff Engagement Documents • National Tariff Document Statutory Consultation Tariff development Publication of 2012/13 PLICS pilot Costing Direction of Travel Costing Guidance for 2014 Costing Start ofpricing case management and local determined prices Casemanagement

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