1-s2.0-S0277953613005261-main

8192019 1-s20-S0277953613005261-main

httpslidepdfcomreaderfull1-s20-s0277953613005261-main 17

Using programme budgeting and marginal analysis (PBMA) to set

priorities Re1047298ections from a qualitative assessment in an English

Primary Care Trust

Elizabeth Goodwin a Emma J Frew b

a NHS Plymouth (Plymouth Primary Care Trust) Building One Brest Road Plymouth PL6 5QZ UK b Health Economics Unit Public Health Building University of Birmingham B15 2TT UK

a r t i c l e i n f o

Article history

Available online 2 October 2013

Keywords

Programme budgeting

Marginal analysis

Priority-setting

Resource allocation

Commissioning

a b s t r a c t

In England from 2002 to 2013 Primary Care Trusts (PCTs) were responsible for commissioning

healthcare for their local populations The NHS has recently undergone rapid organisational change

whereby clinicians have assumed responsibility for local commissioning decisions This change in

commissioning arrangements alongside the current 1047297nancial pressures facing the NHS provides an

impetus for considering the use of technical prioritisation methods to enable the identi1047297cation of

savings without having a detrimental effect on the health of the population This paper reports on the

design and implementation of a technical prioritisation method termed PBMA applied within NHS

Plymouth an English PCT responsible for commissioning services for a population of approximately

270000 We evaluated the effectiveness of the process the extent to which it was appropriate for local

healthcare commissioning and whether it identi1047297ed budget savings Using qualitative research meth-

odology we found the process produced clear strategic and operational priorities for 201011 providing

staff with focus and structure and delivered a substantial planned reduction in hospital activity levels

Participants expressed satisfaction with the process NHS Plymouth adhered to the PBMA process

although concerns were raised about the evidence for some priorities decibel rationing and a lack of robust challenge at priority-setting meetings Further work is required to enhance participants rsquo un-

derstanding of marginal analysis Participants highlighted several external bene1047297ts particularly in

terms of cultural change and felt the process should encompass the whole local health and social care

community This evaluation indicates that the prioritisation method was effective in producing prior-

ities for NHS Plymouth and that PBMA provides an appropriate method for allocating resources at a

local level In order for PBMA to identify savings cultural and structural barriers to disinvestment must

be addressed These 1047297ndings will interest other healthcare commissioners in developing their own

approaches to priority-setting

2013 Elsevier Ltd All rights reserved

Introduction

The recent changes to the NHS in England whereby clinicianshave assumed responsibility for local commissioning decisions

provide an opportunity to improve the methods used for allocating

healthcare resources Prior to this Primary Care Trusts (PCTs)

commissioned healthcare for their local populations PCTs tradi-

tionally based resource allocation decisions on historical data

adjusted for anticipated demographic and technological changes

and policy objectives These historical or political rationing

methods can fail to maximise health gain for the available budgetand this limitation has given rise to the development of more so-

phisticated technical methods (Eddama amp Coast 2009) Such

methods are all the more salient given the current 1047297nancial pres-

sures facing the NHS a technical approach to prioritisation can

enable the identi1047297cation of savings that minimise detrimental

impacts on patients while allowing continuing improvements in

services (Mitton Patten Waldner amp Donaldson 2003) A structured

process can also provide a useful framework for clinical leadership

in commissioning

One technical approach to resource allocation is programme

budgeting and marginal analysis (PBMA) which has been applied

Corresponding author Present address Health Economics Group University of

Exeter Medical School Veysey Building Salmon Pool Lane Exeter EX2 4SG UK

Fax thorn44 (0) 1392 421009

E-mail address egoodwinexeteracuk (E Goodwin)

Contents lists available at ScienceDirect

Social Science amp Medicine

j o u r n a l h o m e p a g e w w w e l s e v i e r c om l o c a t e s o c s c im e d

0277-9536$ e see front matter 2013 Elsevier Ltd All rights reserved

httpdxdoiorg101016jsocscimed201309020

Social Science amp Medicine 98 (2013) 162e168

8192019 1-s20-S0277953613005261-main


to healthcare lsquoin over 80 studies worldwidersquo (Wilson Peacock amp

Ruta 2009) In recent years a number of initiatives have aimed to

promote and facilitate the implementation of PBMA based ap-

proaches in the NHS including the annual Programme Budgeting

benchmarking tool which enables local commissioners to compare

their expenditure on 23 health programmes with national or

comparator group averages (Department of Health 2011) the Right

Care programme which forms part of the NHS Quality Innovation

Productivity and Prevention (QIPP) agenda and a pilot study of

PBMA in three regions which was supported by the NHS Institute

for Innovation and Improvement (Kemp et al 2008) During 2009

the NHS Plymouth Executive Team agreed to the adoption of a

prioritisation process based on PBMA to set priorities for 201011

During the implementation of the process the South West Strategic

Health Authority (SHA) set NHS Plymouth the challenge of making

pound20 million savings over a three-year period starting in 201011

and this became a key focus of the prioritisation process This paper

describes the implementation of the prioritisation process and its

subsequent evaluation It provides a re1047298ection therefore from the

coalface about the usefulness of PBMA for decision-making as well

as sharing lessons learned about the challenges and bene1047297ts of

implementing such an approach and offering suggestions for how

the standard PBMA process can be re1047297ned to meet the speci1047297cneeds of local healthcare commissioners

The research questions addressed by the evaluation were

1 How effective was the new prioritisation process for NHS

Plymouth

2 To what extent does PBMA provide an appropriate method for

local healthcare resource allocation

3 Can PBMA be used to identify savings as well as options for

service improvement

Methods

What is PBMA

The 1047297rst stage of the PBMA process involves drawing up a

programme budget This comprises a map of existing activity and

expenditure across all programme areas (eg cancer obstetrics)

and provides an understanding of the existing deployment of

resources Using this knowledge a multi-disciplinary panel made

up of managers clinicians and other stakeholders devise a list of

options for change to the existing pattern of resource allocation

There are three types of option service redesign to provide the

same output for fewer resources (improving technical ef 1047297ciency)

service improvements requiring additional resources and disin-

vestments ie services that could be scaled back or discontinued

These options are then scored and ranked against a pre-

determined set of criteria which re1047298ect the aims and values of theorganisation The ranked list is then used to lsquotrade-off rsquo options

that require additional investment against those that will yield a

release of resources substituting items with least bene1047297t to fund

items with the most bene1047297t (thus improving allocative ef 1047297ciency)

Through this lsquomarginal analysisrsquo the resources available to the

healthcare organisation are shifted towards programmes that

contribute the most to the organisationrsquos strategic objectives

(Mitton amp Donaldson 2004)

Although this paper focuses primarily on reporting the evalua-

tion of PBMA a great deal of resource was invested in adapting the

process to 1047297t with the unique features of NHS Plymouth as a local

organisation The 1047297rst part of this section describes this adaptation

process the research methods developed for the evaluation of

PBMA then follow

Design methods

Mitton and Donaldsonrsquos seven-step approach to PBMA informed

the design of the process (see Appendix 1) (Mitton amp Donaldson

2004) In a novel development of this approach we split the pro-

cess into two stages to generate two levels of priorities high-level

Strategic Improvement Priorities (the lsquoSIPsrsquo) and more detailed

priorities for changes to speci1047297c services (the lsquoinitiativesrsquo) This

aimed to improve the alignment between the PCTrsquos strategic and

operational planning The process is summarised in Fig 1

PCT analysts compiled a programme budget locally dubbed the

lsquoEvidence Bankrsquo using activity cost needs performance quality

and user experience data They analysed the data to produce a

number of recommendations which were debated at a meeting of

the PCTrsquos Executive Team with representatives of Plymouth Hos-

pitals NHS Trust and Plymouth City Councilrsquos Adult Social Care

Department This resulted in the adoption of nine SIPs for NHS

Plymouth (see Appendix 2)

Fig 1 Prioritisation process 1047298

owchart

E Goodwin EJ Frew Social Science amp Medicine 98 (2013) 162e168 163

8192019 1-s20-S0277953613005261-main


A small group of staff developed and piloted a set of prioritisa-

tion criteria which were based on the values of NHS Plymouth as

published in its Strategic Framework (see Appendix 3) The Pro-

fessional Executive Committee (PEC) approved the criteria thereby

involving clinicians and directors (Mitton amp Donaldson 2004)

Nine multidisciplinary Health Programme Groups comprising

clinicians and managers from a range of disciplines developed

proposals and business cases for initiatives to deliver the SIPs using

the Evidence Bank to identify potential quality or productivity

improvements Finance staff created a 1047297nancial template to enable

the net present value of each initiativersquos short and long term

1047297nancial impacts to be calculated (Law 2004) A multidisciplinary

panel scored each initiative against the prioritisation criteria

Finally the PEC debated the suggested initiatives on the basis of

their scores against the prioritisation criteria and 1047297nancial infor-

mation involving clinicians and directors from NHS Plymouth and

Plymouth Hospitals NHS Trust in selecting the1047297nal set of initiatives

for implementation

Evaluation methods

We formulated research questions on the basis of a conceptual

framework which was informed by a review of the literature onimplementing PBMA and issues raised in discussions with stake-

holders (see Appendix 4) (Miles amp Huberman 1994)

Qualitative methods are particularly suited to process evalua-

tion While quantitative methods can tell you what has happened

qualitative methods are better for illuminating why things have

happened what effect this has had and how things could be

improved (Clarke amp Dawson 1999) We undertook semi-structured

lsquoexpert interviewsrsquo with staff involved in the prioritisation process

as they were best placed to describe its effectiveness and to suggest

improvements One-to-one interviewing allows in-depth explora-

tion of individualsrsquo views and experiences The semi-structured

approach ensures coverage of all aspects of the research question

de1047297ned a priori while enabling the participant to bring hisher own

perspective to bear often revealing important unexpected 1047297ndings(Flick 2002 Marshall amp Rossman 1995 Posavac amp Carey 1992)

The main researcher for this evaluation was a Health Economist

employed as a permanent member of NHS Plymouth staff who had

also led the design and implementation of the prioritisation pro-

cess She was responsible for developing the sampling strategy and

interview guides conducting all interviews recording these using a

digital Dictaphone overseeing the verbatim transcription of re-

cordings and leading the data analysis We adopted a purposive

sampling strategy (Silverman 2010) and selected 13 from a possible

26 staff members in order to represent different roles within the

process roles within the organisation (eg clinician director

manager) and functions (eg 1047297nance primary care public health)

We developed different interview guides for participants with

different roles varied the wording and order of the questions toallow the interviews to unfold naturally and spontaneously added

additional questions to probe new themes that emerged during the

interviews (see Appendix 5) (Flick 2002)

We identi1047297ed the key themes emerging from the interviews

using a thematic coding process (Flick 2002) Although the process

was primarily inductive there was also a deductive element as the

research questions in1047298uenced some themes We noted each new

theme and gradually organised the themes into categories using

the qualitative analysis software NVIVO We explored how the

themes related to one another by applying the resulting coding

frame back onto the data (Coffey amp Atkinson 1996) Analytic rigour

was enhanced by checking the interpretation of the data with the

second author and with research participants subsequent to

interview

The fact that the interviews and analysis were conducted by the

main architectof the prioritisation process could constitute a risk of

biasing the results the interviewer may have a vested interest in a

favourable result and participants may feel uncomfortable criti-

cising the process Previous research into PBMA implementation

however suggests that this is mitigated by the fact that the inter-

viewer had worked closely with the research participants as a

colleague to develop and implement the process (Patten Mitton amp

Donaldson 2006) From the researcherrsquos point of view the aim was

to develop the process over a number of yearsrather than getting it

right 1047297rst time enabling criticism from colleagues to be perceived

as a constructive factor in achieving a long-term vision This was

assisted by keeping a re1047298exive research diary which included

personal reactions to critical comments Participants were assured

that constructive criticism was welcome and central to improving

the process Interview error is common in evaluation research as

staff may avoid expressing views of which managers may disap-

prove (Marshall amp Rossman 1995) Reassurance was provided by

ensuring that all participants were aware of con1047297dentiality

Research participants were advised that their views on the

process were being sought in order to evaluate the process and its

implementation and to inform future improvements All partici-

pants signed consent forms prior to interview (Gray 2004) Noperson-identi1047297able information was used Digital recordings and

transcripts were password-protected recordings were deleted

once the transcriptions had been checked and all transcripts were

anonymised

Results

All 13 people approached were happy to participate in the in-

terviews although onewas unable to attend The interviews ranged

from 35 to 80 min in length and their content varied considerably

depending upon the interests and concerns of each interviewee

Those interviewed included SIP leads ie the service improvement

and commissioning managers who led the teams responsible for

developing the initiatives clinicians 1047297nance performance andcontracts staff who contributed to the development of the initia-

tives those who ran the implementation of the prioritisation

process and members of the PEC who were responsible for

agreeing the 1047297nal list of prioritised initiatives Interviewees

comprised staff responsible for the acute care contract primary

care mental health and learning disability services and public

health The results for each dimension of the conceptual framework

that related to the outcomes of the prioritisation process are dis-

cussed below

How satis 1047297ed were participants with the process

People were unanimously happy with the process as a concept

A key reason for this was that the process was universally consid-ered an improvement The process was applauded for being

ldquorobustrdquo ldquostructuredrdquo ldquoevidence basedrdquo and ldquosystematicrdquo in

contrast to the PCTrsquos previous approach to resource allocation

which was criticised by several participants e particularly those

lower down the organisational hierarchy e for involving decibel

rationing These participants welcomed this more inclusive

evidence-based process as a means of limiting the power of in1047298u-

ential individuals to determine priorities At the same time the

combination of technical and political approaches to prioritisation

inherent in the process was valued by some including both clini-

cians who appreciated the opportunity to offer expert opinion

For some participants the ability to compare initiatives and

trade off investments against disinvestments was an important

feature of the process while others struggled to grasp the concept

E Goodwin EJ Frew Social Science amp Medicine 98 (2013) 162e168164

8192019 1-s20-S0277953613005261-main


This dif 1047297culty was apparent both during the interviews and during

the implementation where the concept of trading off proved to be

the most challenging aspect of the process to explain to

participants

Although participants were satis1047297ed with the concept of PBMA

several of those who were involved in developing initiatives re-

ported that tight timescales and uncertainty around some aspects

of the process implementation had caused anxiety and pressure

Fortunately however most felt that the PCT had made a good start

ldquoEven as we were struggling to try and deliver things quickly all

the way through the process I just thought that I actually like

what wersquore trying to achieverdquo

Participants were con1047297dent that the processwould be used again

in the future They did suggest a number of improvements none of

which were fundamental better timing more capacity for devel-

oping business cases improved quality of business cases more

stakeholder involvement and better links to capacity planning

How fully did NHS Plymouth comply with the process

When asked about the extent to which they had adhered to theprocess the majority of participants felt that they had mostly but

not fully complied

ldquoI think we stuck with the process About 90rdquo

Their responses revealed three ways in which they strayed from

the process Firstly several people felt that certain initiatives were

not derived from the SIPs or the Evidence Bank This was corrob-

orated by the SIP leads who described how the Evidence Bank had

reinforced existing ideas rather than inspired new ones

Secondly a few people expressed concern that decibel rationing

occurred during the PEC prioritisation meetings at which the SIPs

and the prioritised list of initiatives were agreed and that this took

precedence over the Evidence Bank

ldquoThose with the biggest in1047298uence are getting their wayrdquo

Finally several participants felt that the initiatives could have

been subjected to a more challenging debate at the PEC meetings

When questioned about this the decision-makers who were

interviewed expressed a reluctance to criticise or reject initiatives

for fear of demotivating staff

What were the main outcomes of the process

Despite the concerns outlined above all participants expressed a

general feeling that the process had produced the right priorities

Several stated that rather than changing the priorities of the orga-

nisation the process had made these priorities more explicit using

words like ldquovisibilityrdquo

ldquoawarenessrdquo

and ldquocorporate visionrdquo

Partici-pants considered this to be one of the most important outcomes of

the process They described how the SIPs had become known and

understood throughout the organisation providing a clearer stra-

tegic direction and greater awareness among staff of the PCTrsquos pri-

orities A large majority of participants took this concept further

explaining that the unprecedented clarity around NHS Plymouthrsquos

priorities provides staff with a focus and structure that was previ-

ously lacking helping them to prioritise their workload and the

deployment of resources and effort In this way the process was felt

tohavealignedthePCTrsquos day-to-day work to clear strategic priorities

The potential for the process to provide an appropriate means of

achieving the required level of 1047297nancial savings was recognised by

several participants by providing ethically sound criteria on which

to base these decisions and a robuststructure to deal with1047297

nancial

challenges The estimated savings accruing from the initiatives

however were insuf 1047297cient to meet the 1047297nancial target for 201011

Only one initiative represented a true disinvestment although the

majority offered technical ef 1047297ciencies To investigate this partici-

pants were asked to identify barriers to ideas for disinvestment

Participants from the Finance Directorate pointed out that the

concept of disinvesting represents a major cultural shift following

years of increasing investment in the NHS Moreover they felt that

considerable scope exists for technical ef 1047297ciencies and the ethical

approach is to tackle these before seeking to disinvest

ldquoThatrsquos natural and itrsquos rightrdquo

Those involved in running the process implementation

wondered whether the capacity to generate and deliver initiatives

was limited because the SIP leads were relatively junior to be

proposing large scale changes with major 1047297nancial implications

Support from directors was therefore considered a key factor in

granting the SIP leads a mandate to propose disinvestments and

comments from the SIP leads corroborated this

ldquoIrsquom not sure wersquove been given permission to be that radicalrdquo

Attitudes towards 1047297nancial considerations differed between

roles SIP leads and clinicians felt that 1047297nancial bene1047297ts were toohighly weighted resulting in projects with potentially high health

gain receiving too low a priority Although they recognised the

importance of balancing the budget they found this dif 1047297cult to

reconcile with their roles which they perceived as being to improve

health Conversely 1047297nance performance and contracts staff felt

that 1047297nancial balance should be weighted more highly than health-

related bene1047297ts

The technical ef 1047297ciencies identi1047297ed by the process resulted in a

substantial reduction in hospital activity which was one of the

main aims of the prioritisation process Table 1 compares hospital

activity levels for NHS Plymouth with overall 1047297gures for England

using 200910 as a baseline

NHS Plymouth showed a reduction in total non-elective ad-

missions and 1047297rst outpatient attendances against a nationalbackdrop of increases in both The increase in elective daycases

represents a shift from inpatient admissions involving an over-

night stay Whereas nationally the decrease in elective inpatient

admissions was more than offset by an increase in daycase activity

NHS Plymouth increased the number of procedures undertaken as

daycases while achieving an overall reduction in elective activity

Table 1

Change in hospital activity levels (general and acute) 200910e201112

Elective

ordinary

admissionsab

Elective

daycase

admissions

Elective

total

admissions

Non-elective

total

admissions

First outpatient

attendances c

England200910 1628113 5267244 6895357 5235766 15276762

201011 1593215 5547697 7140818 5458026 15836204

201112 1567446 5830730 7398177 5404048 15914410

Total

change

373 1070 729 321 417

NHS Plymouth

200910 9041 25362 34403 29231 74969

201011 7624 24010 31634 27790 70937

201112 7494 26216 33710 25675 72751

Total

change

1 71 1 3 37 201 1217 296

a Admissions frac14 1047297rst 1047297nished consultant episodesb Ordinary admissions frac14 inpatient admissions including at least one overnight

stayc First outpatient attendances frac14 1047297rst consultant outpatient attendances

Source Department of Health Hospital Activity Statistics 200910e

201112


8192019 1-s20-S0277953613005261-main


8192019 1-s20-S0277953613005261-main


resulting in some confusion Starting the process late in the year

limited the time and support available for SIP leads to develop ini-

tiatives which may provide an explanation for their tendency to

recycle existing ideas and propose insuf 1047297cient disinvestment op-

portunities An important source of support that was lacking was

from the Finance Team in estimating the 1047297nancial implications of

the proposed initiatives leading to a lack of robust 1047297nancial pro-

jections to inform decision-making This arose in part from the

initiative development stage of the prioritisation process coinciding

with the development of the Medium Term Financial Plan which

occupies the Finance Team full-time during this period In addition

further skills development may be necessary to enable staff to pro-

duce 1047297nancial estimates Crucially the timing of the process meant

that details of the initiatives were not available to inform capacity

planning It is paramount that this is addressed failure to integrate

PBMA with widerplanning processes presents a barrier to achieving

changes in patterns of service delivery (Kemp et al 2008)

The two-stage process design whereby strategic priorities were

agreed prior to developing speci1047297c initiatives proved highly suc-

cessful resulting in unprecedented clarity of the PCTrsquos vision and

objectives and linking the day-to-day work of staff to clear strategic

aims Participants expressed strong approval for the process 1047297nding

the structured and evidence-based approach a signi1047297cant improve-ment to previous practices No systematic approach to resource

allocation had previously been implemented by NHS Plymouth

participants suggested that 1047297nancial decisions had been taken by

powerful individualsand thatweak planning processes had resulted

in a lack of clear strategic priorities and work-plans Eddama and

Coastrsquos (2009) research suggests this is not unusual for a PCT A

major outcome of the prioritisation process has been to challenge

this and to provide a driver for the positive cultural changes that

participants perceive to be taking place re1047298ecting 1047297ndings from the

literature about PBMA engendering organisational change (Halma

Mitton Donaldson amp West 2004) A recurring theme from the in-

terviews was participantsrsquo disapproval of decibel rationing This was

a major criticism levelled against NHS Plymouthrsquos previous approach

to prioritisation particularly by those further down the hierarchyre1047298ecting Mitton Patten et alrsquos 1047297ndings that a lack of an explicit

prioritisation process causes managersand clinicians to question the

credibility of resource allocation decisions (2003) A key reason for

participantsrsquo approval of PBMA was that it limited decibel rationing

and some were keen to highlight concerns that this was still occur-

ring in the PEC prioritisation meetings The SIP leadshowever were

unconcerned that they had developed some initiatives prior to

seeing the Evidence Bank citing expert opinion An interesting ten-

sion emerges at what point does expert opinion (perceived as a

positive feature of PBMA) become decibel rationing (perceived as

negative) Analysis of the interviews suggests that those higher up

the hierarchy are seen to engage in decibel rationing whereas less

powerful individuals offer expert opinion potentially leading to an

over-estimation of the formerrsquos involvement in decibel rationing

This in turn may explain the apparent discrepancy between partici-

pantsrsquo perceptions of decibel rationing and their approval of the

chosen SIPs and initiatives The PBMA process however enables less

powerful individuals to participate in decision-making (Gibson

Martin amp Singer 2005) In doing so how does one ensure that

these new stakeholders do not take up the mantle of decibel ra-

tioning themselves There is a balance to be struck efforts to limit

decibel rationing should not act to sti1047298e expert opinion as the

combination of technical and political approaches to prioritisation is

a strength of PBMA (Wilson et al 2009)

Published accounts of PBMA applications suggest that limited

suggestions for releasing resources tend to be put forward ( Mitton

Peacock Donaldson amp Bate 2003) In the Plymouth case although

only one initiative represented a true disinvestment the majority

offeredtechnical ef 1047297ciencies Many of the initiatives sought to couple

ef 1047297ciency savings with service improvements re1047298ecting the strongly

expressed perception by SIP leads of their role being to improve

services Finance staff too believed that disinvestments should not

be considered until opportunities for technical ef 1047297ciency are

exhaustedBarriers to disinvestmentincluded limitedcapacity for the

development and implementation of initiatives and the position of

SIP leads in the organisational hierarchy the latter pointing to a key

role for directors in supporting staff to participate in the process A

reluctance to disinvest is unsurprising as periods of increasing gov-

ernment investmentin healthcaresuch as thatenjoyed by theNHS in

the preceding decade do not promote a culture of resource reallo-

cation (Mitton Donaldson Waldner amp Eagle 2003) The process did

however produce technical ef 1047297ciency improvements which can

provide a catalyst for healthcare organisations to accept disinvest-

ment (Mitton Patten et al 2003) A further driver for future disin-

vestment is the current budgetary pressures facing the NHS All

participants recognised the inevitability of meeting 1047297nancial chal-

lenges e although 1047297nance and performance staff were more

comfortable with this than their service improvement commis-

sioning and clinical colleagues e and the prioritisation process was

felt to be an appropriate vehicle for achieving this

The intention was that the Professional Executive Committeewould 1047297rst consider ideas for improving technical ef 1047297ciency ie

achieving comparable outcomes at less cost followed by ideas for

disinvestment selecting those with the lowest bene1047297t scores to

minimise detrimental impacts Once the pound20 million savings stipu-

lated by theStrategic Health Authority hadbeen identi1047297ed trade-offs

between further disinvestments and projects requiring additional

investment would be made The 1047297nancial estimates however sug-

gested that the proposed initiatives totalled less than the required

level of savings therefore all the initiatives that offered savings were

approved leaving no available resource to fundinitiativesrequiring a

net investment Nevertheless two initiatives that required invest-

ment were approved by the PEC pending suf 1047297cient funding being

released by other projects despite the fact that this funding was

already earmarked for the necessary budgetary reduction This re-1047298ects a level of confusion about the marginal analysis part of the

process It was certainly the most challenging aspect of PBMA to

explain to participants and some dif 1047297culty in grasping the concept

was evident in the interviews This suggests a need (re1047298ected in the

literature) for more education around the key economic principles of

PBMA which are unfamiliar to most managers and clinicians

(Mitton Donaldson et al 2003) Of more concern perhaps was a

perceived lack of robust debate and challenge around the business

cases presented to PEC Decision-makers expressed a reluctance to

turn down initiatives for fear of demotivating staff This cultural

feature must be addressed if PBMA is to work effectively

A major theme of the interviews was the perceived need to move

from a commissioner to a healthcare community perspective incor-

porating healthcare providers and the localauthorityParticipantsfeltthat a failure to engage the wider healthcare community in priority

setting could jeopardise the realisation of these priorities where this

is reliant on external stakeholders changing their patterns of service

delivery (Mitton Patten et al 2003) They suggested that joint

planning could ensure that any planned reductions in commissioned

activity do not destabilise the 1047297nancial position of providers This

provides a potential solution to concerns raised by Mitton

Donaldson et al (2003) about the applicability of PBMA to health-

care environments characterised by a structural separation between

commissioners and providers Plymouthrsquos organisational boundaries

provided a useful facilitator for tackling this challenge local data

shows that over 90 of NHS Plymouthrsquos acute activity was commis-

sioned from PHNT and the PCTrsquos catchment area was coterminous

with that of Plymouth City Council


8192019 1-s20-S0277953613005261-main


A key strength of this application of PBMAwasthat the design of

the process was based on the 1047297ndings of a comprehensive literature

review undertaken by a health economist and was speci1047297cally

tailored to the organisational context of NHS Plymouth The use of

qualitative methods for evaluation provided a further advantage

qualitative approaches are particularly effective in illuminating

why things have happened what effect this has had and how

things could be improved (Clarke amp Dawson 1999) Both the

implementation and the evaluation however were undertaken in a

single small PCT in a health and social care environment domi-

nated by one major secondary care provider and one unitary local

authority possibly limiting the generalisability of the results

Further research into the effectiveness of alternative technical

approaches to priority-setting or in healthcare environments

characterised by a greater plurality of providers would provide a

valuable contribution to the literature and produce results that are

generalisable to a wider range of commissioner and provider set-

tings At the time of writing discussions are underway to apply the

PBMA approach across the Plymouth healthcare community within

speci1047297c care pathways and this could also provide fertile ground

for future research

In conclusion this research indicates that PBMA offers a prac-

tical and effective method for resource allocation decision makingat a local level One interesting 1047297nding is that despite initial mis-

givings clinicians in Plymouth acknowledged the advantages of a

more technical approach to decision-making once they had

participated in the process This echoes previous research that

suggests involvement in PBMA enhances the ability of clinicians to

engage with system-wide resource allocation (Harrison amp Mitton

2004) The PBMA process provides a useful framework for clinical

leadership through setting prioritisation criteria working together

with management support staff to devise initiatives agreeing

strategic priorities and speci1047297c initiatives to improve ef 1047297ciency and

patient outcomes and spearheading the implementation of these

initiatives While this is of particular relevance in the English NHS

given the imminent transfer of commissioning responsibilities

from PCTs to Clinical Commissioning Groups PBMA may also pro-vide a useful vehicle for any healthcare system seeking greater

clinical involvement in population-wide decision-making

Appendix A Supplementary data

Supplementary data related to this article can be found at http

dxdoiorg101016jsocscimed201309020

References

Clarke A amp Dawson R (1999) Evaluation research An introduction to principlesmethods and practice London Sage

Coffey A amp Atkinson P (1996) Making sense of qualitative data Complementaryresearch strategies Thousand Oaks Sage

Department of Health Hospital Activity Statistics 200910e201112 httpwwwdhgovukenPublicationsandstatisticsStatisticsPerformancedataandstatisticsHospitalActivityStatisticsDH_129868 (Last Accessed 191112)

Department of Health (2011) 201011 programme budgeting PCT benchmarking toolLondon Department of Health httpwebarchivenationalarchivesgovukthornwwwdhgovukenManagingyourorganisationFinanceandplanningProgrammebudgetingDH_075743 (Last Accessed 011012)

Eddama O amp Coast J (2009) Use of economic evaluation in local health caredecision-making in England a qualitative investigation Health Policy 89 261e270

Flick U (2002) An introduction to qualitative research (2nd ed) London SageGibson J L Martin D K amp Singer P A (2005) Priority setting in hospitals fair-

ness inclusiveness and the problem of institutional power differences SocialScience amp Medicine 61 2355e2362

Gray D E (2004) Doing research in the real world London SageHalma L Mitton C Donaldson C amp West B (2004) Case study on priority setting

in rural Southern Alberta keeping the house from blowing in Canadian Journalof Rural Medicine 9 26e36

Harrison A amp Mitton C (2004) Physician involvement in setting priorities forhealth regions Healthcare Management Forum 17 21e27

Kemp L Fordham R Robson A Bate A Donaldson C Baughan S et al (2008)Road testing programme budgeting and marginal analysis (PBMA) in three English

regions Hull (Diabetes) Newcastle (CAMHS) Norfolk (Mental health) YorkYorkshire and Humber Public Health Observatory httpwwwyhphoorgukresourceitemaspxRIDfrac1410049 (Last Accessed 011012)

Law M A (2004) Using Net Present Value as a decision-making tool Air Medical Journal 23 28e33

Marshall C amp Rossman G B (1995) Designing qualitative research (2nd ed)Thousand Oaks Sage

Miles M B amp Huberman A M (1994) Qualitative data analysis An expandedsourcebook (2nd ed) Thousand Oaks Sage

Mitton C amp Donaldson C (2004) Health care priority setting principles practiceand challenges Cost Effectiveness and Resource Allocation 2 3e10

Mitton C Donaldson C Waldner H amp Eagle C (2003) The evolution of PBMAtowards a macro-level priority setting framework for health regions HealthCare Management Science 6 263e269

Mitton C Patten S Waldner H amp Donaldson C (2003) Priority setting in healthauthorities a novel approach to a historical activity Social Science amp Medicine57 1653e1663

Mitton C Peacock S Donaldson C amp Bate A (2003) Using PBMA in health carepriority setting description challenges and experience Applied Health Eco-

nomics and Health Policy 2 121e

134Patten S Mitton C amp Donaldson C (2006) Using participatory action research to

build a priority setting process in a Canadian Regional Health Authority SocialScience amp Medicine 63 1121e1134

Posavac E J amp Carey R G (1992) Program evaluation Methods and case studiesNew Jersey Prentice Hall

Silverman D (2010) Doing qualitative research A practical handbook (3rd ed)London Sage

Wilson E C F Peacock S J amp Ruta D (2009) Priority setting in practicewhat is the best way to compare costs and bene1047297ts Health Economics 18467e478


8192019 1-s20-S0277953613005261-main


to healthcare lsquoin over 80 studies worldwidersquo (Wilson Peacock amp

Ruta 2009) In recent years a number of initiatives have aimed to

promote and facilitate the implementation of PBMA based ap-

proaches in the NHS including the annual Programme Budgeting

benchmarking tool which enables local commissioners to compare

their expenditure on 23 health programmes with national or

comparator group averages (Department of Health 2011) the Right

Care programme which forms part of the NHS Quality Innovation

Productivity and Prevention (QIPP) agenda and a pilot study of

PBMA in three regions which was supported by the NHS Institute

for Innovation and Improvement (Kemp et al 2008) During 2009

the NHS Plymouth Executive Team agreed to the adoption of a

prioritisation process based on PBMA to set priorities for 201011

During the implementation of the process the South West Strategic

Health Authority (SHA) set NHS Plymouth the challenge of making

pound20 million savings over a three-year period starting in 201011

and this became a key focus of the prioritisation process This paper

describes the implementation of the prioritisation process and its

subsequent evaluation It provides a re1047298ection therefore from the

coalface about the usefulness of PBMA for decision-making as well

as sharing lessons learned about the challenges and bene1047297ts of

implementing such an approach and offering suggestions for how

the standard PBMA process can be re1047297ned to meet the speci1047297cneeds of local healthcare commissioners

The research questions addressed by the evaluation were

1 How effective was the new prioritisation process for NHS

Plymouth

2 To what extent does PBMA provide an appropriate method for

local healthcare resource allocation

3 Can PBMA be used to identify savings as well as options for

service improvement

Methods

What is PBMA

The 1047297rst stage of the PBMA process involves drawing up a

programme budget This comprises a map of existing activity and

expenditure across all programme areas (eg cancer obstetrics)

and provides an understanding of the existing deployment of

resources Using this knowledge a multi-disciplinary panel made

up of managers clinicians and other stakeholders devise a list of

options for change to the existing pattern of resource allocation

There are three types of option service redesign to provide the

same output for fewer resources (improving technical ef 1047297ciency)

service improvements requiring additional resources and disin-

vestments ie services that could be scaled back or discontinued

These options are then scored and ranked against a pre-

determined set of criteria which re1047298ect the aims and values of theorganisation The ranked list is then used to lsquotrade-off rsquo options

that require additional investment against those that will yield a

release of resources substituting items with least bene1047297t to fund

items with the most bene1047297t (thus improving allocative ef 1047297ciency)

Through this lsquomarginal analysisrsquo the resources available to the

healthcare organisation are shifted towards programmes that

contribute the most to the organisationrsquos strategic objectives

(Mitton amp Donaldson 2004)

Although this paper focuses primarily on reporting the evalua-

tion of PBMA a great deal of resource was invested in adapting the

process to 1047297t with the unique features of NHS Plymouth as a local

organisation The 1047297rst part of this section describes this adaptation

process the research methods developed for the evaluation of

PBMA then follow

Design methods

Mitton and Donaldsonrsquos seven-step approach to PBMA informed

the design of the process (see Appendix 1) (Mitton amp Donaldson

2004) In a novel development of this approach we split the pro-

cess into two stages to generate two levels of priorities high-level

Strategic Improvement Priorities (the lsquoSIPsrsquo) and more detailed

priorities for changes to speci1047297c services (the lsquoinitiativesrsquo) This

aimed to improve the alignment between the PCTrsquos strategic and

operational planning The process is summarised in Fig 1

PCT analysts compiled a programme budget locally dubbed the

lsquoEvidence Bankrsquo using activity cost needs performance quality

and user experience data They analysed the data to produce a

number of recommendations which were debated at a meeting of

the PCTrsquos Executive Team with representatives of Plymouth Hos-

pitals NHS Trust and Plymouth City Councilrsquos Adult Social Care

Department This resulted in the adoption of nine SIPs for NHS

Plymouth (see Appendix 2)

Fig 1 Prioritisation process 1047298

owchart


8192019 1-s20-S0277953613005261-main



















for implementation

Evaluation methods









































interview


























anonymised

Results















cussed below


















8192019 1-s20-S0277953613005261-main





participants
















not fully complied























ldquoawarenessrdquo
















nancial








































Table 1


Elective

ordinary

admissionsab

Elective

daycase

admissions

Elective

total

admissions

Non-elective

total

admissions

First outpatient

attendances c

England200910 1628113 5267244 6895357 5235766 15276762

201011 1593215 5547697 7140818 5458026 15836204

201112 1567446 5830730 7398177 5404048 15914410

Total

change

373 1070 729 321 417

NHS Plymouth

200910 9041 25362 34403 29231 74969

201011 7624 24010 31634 27790 70937

201112 7494 26216 33710 25675 72751

Total

change

1 71 1 3 37 201 1217 296




201112


8192019 1-s20-S0277953613005261-main


8192019 1-s20-S0277953613005261-main
































































































































8192019 1-s20-S0277953613005261-main






















for future research




















References



























8192019 1-s20-S0277953613005261-main



















for implementation

Evaluation methods









































interview


























anonymised

Results















cussed below


















8192019 1-s20-S0277953613005261-main





participants
















not fully complied























ldquoawarenessrdquo
















nancial








































Table 1


Elective

ordinary

admissionsab

Elective

daycase

admissions

Elective

total

admissions

Non-elective

total

admissions

First outpatient

attendances c

England200910 1628113 5267244 6895357 5235766 15276762

201011 1593215 5547697 7140818 5458026 15836204

201112 1567446 5830730 7398177 5404048 15914410

Total

change

373 1070 729 321 417

NHS Plymouth

200910 9041 25362 34403 29231 74969

201011 7624 24010 31634 27790 70937

201112 7494 26216 33710 25675 72751

Total

change

1 71 1 3 37 201 1217 296




201112


8192019 1-s20-S0277953613005261-main


8192019 1-s20-S0277953613005261-main
































































































































8192019 1-s20-S0277953613005261-main






















for future research




















References



























8192019 1-s20-S0277953613005261-main





participants
















not fully complied























ldquoawarenessrdquo
















nancial








































Table 1


Elective

ordinary

admissionsab

Elective

daycase

admissions

Elective

total

admissions

Non-elective

total

admissions

First outpatient

attendances c

England200910 1628113 5267244 6895357 5235766 15276762

201011 1593215 5547697 7140818 5458026 15836204

201112 1567446 5830730 7398177 5404048 15914410

Total

change

373 1070 729 321 417

NHS Plymouth

200910 9041 25362 34403 29231 74969

201011 7624 24010 31634 27790 70937

201112 7494 26216 33710 25675 72751

Total

change

1 71 1 3 37 201 1217 296




201112


8192019 1-s20-S0277953613005261-main


8192019 1-s20-S0277953613005261-main
































































































































8192019 1-s20-S0277953613005261-main






















for future research




















References



























8192019 1-s20-S0277953613005261-main


8192019 1-s20-S0277953613005261-main
































































































































8192019 1-s20-S0277953613005261-main






















for future research




















References



























8192019 1-s20-S0277953613005261-main
































































































































8192019 1-s20-S0277953613005261-main






















for future research




















References



























8192019 1-s20-S0277953613005261-main






















for future research




















References



























Documents

1-s2.0-S0277953613005261-main