Shaping healthcare finance

Direct Payments for Healthcare

Practical Guide

Published by the Healthcare Financial Management Association (HFMA), Albert House, 111 Victoria Street, Bristol BS1 6AX

Tel: (44) 0117 929 4789 Fax: (44) 0117 929 4844 E-mail: info@hfma.org.uk

This guide has been produced by members of the HFMA’s Commissioning Finance Group working closely with the Department of Health’s personal health budget pilot sites. The drafting was carried out by Simon Stockton of Groundswell Partnership and the editor was Anna Green.

Cover design was undertaken by YZDESIGNS, setting by Academic + Technical Typesetting and printing by ESP Colour Ltd.

The NHS is always changing and developing – this edition reflects the structures and processes in place in September 2012. We are keen to obtain feedback on ways in which the content, style and layout can be improved to better meet the needs of its users. Please forward your comments to info@hfma.org.uk or to the address above.

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© Healthcare Financial Management Association 2012. All rights reserved.

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ISBN 978-1-904624-75-2

Practical Guide: Direct Payments for Healthcare

Contents

Foreword Page 2

Acknowledgements Page 3

Executive summary Page 4

Introduction Page 5

1. What are direct payments? Page 6

2. Other ways of delivering personal health budgets Page 8

3. How to cost direct payments Page 9

4. How direct payments for healthcare can be spent Page 11

5. Integrating direct payments between health and social care Page 15

6. Monitoring and reviewing direct payments Page 16

7. The role of direct payment support services Page 19

8. Concluding thoughts Page 21

Appendices Page 22

i. Example personal health budget team financial process Page 22

ii. A checklist for what must be included in a care or support plan Page 23

iii. Example healthcare direct payment contract Page 24

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Foreword

Evidence is building that people using direct payments to meet their health needs can lead tomore effective healthcare. So far, the implementation of direct payments and personal healthbudgets for NHS services has been limited to relatively small-scale pilots. However we mustnot underestimate the potential for this policy to radically alter how spending decisions aremade, and to change the way in which large amounts of NHS money are committed. There arevaluable lessons to be learned both from the NHS pilots and colleagues in social care aboutthe benefits, risks and challenges that come from passing public money into the hands (andbank accounts) of individuals, and there is no doubt that this agenda will need strong financialengagement at strategic, policy, and operational level if it is to be successfully managed.Health service finance managers have a vital role to play in managing this important transitionin a way that can realise the benefits we know this change can bring. This practical guideprovides an overview for finance managers working in health services to help build a solidunderstanding of this policy area and of the practical issues entailed in rolling out directpayments as a key part of good healthcare delivery.

Cathy Kennedy,Chair of the HFMA’s Commissioning Finance Group

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Acknowledgments

This guide has been produced by members of the HFMA’s Commissioning Finance Groupworking closely with the Department of Health’s personal health budget pilot sites. Thedrafting was carried out by Simon Stockton of Groundswell Partnership and the editor wasAnna Green. The HFMA is grateful to all those who have been involved in producing thispublication.

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Executive summary

. This guide covers the information that health service finance managers working incommissioning organisations (specifically primary care trusts and in future clinicalcommissioning groups) need to understand in relation to direct payments for healthcare.

. Direct payments for healthcare are cash payments paid to people to enable them topurchase the care they need. They are an important way of supporting people to exercisemore choice and control in meeting their long-term healthcare needs and agreed healthand wellbeing outcomes.

. Direct payments are one way of delivering a personal health budget (PHB). PHBs can alsobe delivered as notional or third party budgets. At present, any PCT can offer PHBs asnotional or third party budgets but only approved pilot sites can offer PHBs as directpayments.

. Subject to the results of the evaluation to be published in October 2012, people eligiblefor fully funded continuing NHS healthcare will have the right to ask for a PHB (which willinclude direct payments) from April 2014.

. Early evidence from the PHB pilots in England is highlighting how sites are successfullyusing direct payments for healthcare, sometimes in ways which would not be possible viatraditionally commissioned services.

. There is no set amount for a direct payment. In each case the amount must be arrived atthrough an individual assessment. Sometimes this may be done using a specific budgetsetting tool or via costing of existing services. Whichever method is used the amount ofmoney offered must be adequate to meet the eligible needs.

. Direct payments for healthcare can only be signed off once a care or support plan hasbeen approved by the commissioning organisation. People can use the money flexiblyprovided it is not used for anything illegal and that any identified risks are adequatelymanaged.

. Evidence from people using direct payments in social care and from PHB pilot sites hasshown that some people can find the process of getting a direct payment stressful andconfusing. Efforts should be made to keep processes quick, simple, and transparent.

. People should be able to access good advice, information and support to help them takeup and use healthcare direct payments effectively. PHB pilot sites have found that usinglocal direct payment support services set up for people using social care direct paymentscan be a very effective way of ensuring people get the help they need.

. Where people have both health and social care needs particular attention should begiven to making the process as seamless as possible.

. Direct payments should be monitored in ways that are proportionate to the particularrisks in each individual case. A lighter touch approach to monitoring is advised whereverpossible and appropriate.

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Introduction

Personal health budgets (PHBs) are an important way of giving people more control over theirhealth and wellbeing and, subject to the results of the national evaluation (to be published inOctober 2012), the government intends to roll out PHBs for people with long-term healthconditions.

Direct payments, which allow people to receive a PHB into a designated bank account andarrange services for themselves are a proven way of ensuring people can gain more control.The intention of healthcare direct payments is to give people control over the financialresources available through the NHS to meet their healthcare needs.

Direct payments legislation was first introduced in 1996 following a long campaign led bydisabled people to take control of the money used by local authorities and other bodies to payfor care services and to choose how to use that money to best effect.

At the time of writing the full details of how PHBs will be implemented have yet to befinalised. However, the Secretary of State for Health has already announced that, subject to theresults of the evaluation to be published in October 2012, by April 2014 everyone in receipt ofNHS continuing healthcare will have a right to ask for a PHB, including a direct payment. Asthe organisations that commission healthcare services will change from April 2013, we haveused the term ‘commissioning organisation’ throughout this guide to refer to both primarycare trusts (PCTs) and clinical commissioning groups (CCGs).

This booklet is being published by HFMA with support from the Department of Health and isintended for use by health service finance managers. It focuses on the practical issues involvedin the financial management of direct payments for healthcare and explains the role of directpayments in government policy as a means of improving and personalising the delivery ofcertain types of health services. This guidance builds on learning from the use of directpayments in social care and from the PHB pilots. For more information about the PHB pilotsand up to date learning go to the Department of Health’s PHB web pages:www.personalhealthbudgets.dh.gov.uk

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Chapter 1: What are direct payments?

1.1 Direct payments for healthcare are cash payments made to people to enable them topurchase the care they need. They are one way of receiving a PHB. People receiving adirect payment take on direct responsibility for purchasing support and services to meetthe outcomes agreed in their care or support plan.

1.2 The care or support plan can be developed by the person themselves with help fromfriends and family, peers or appropriate professionals. Once completed thecommissioning organisation needs to agree the plan before agreeing a direct payment.

1.3 A person can receive a direct payment to meet all of their assessed health needs or forpart of them alongside support provided in other ways. They can be made as one offpayments (for example, for items of equipment) or as regular payments to meet ongoingneeds. Many people with ongoing needs use direct payments to employ personalassistants directly rather than use agency staff. This approach is illustrated in the casestudy at the end of this section.

1.4 In order to receive a direct payment the person must be both willing and able tomanage it (alone or with support). However, there is a range of ways in which a personcan be supported to manage a direct payment. In addition, they can if they wishnominate someone to manage the direct payment wholly on their behalf (a nominee). Anominee must be willing to accept full responsibility for managing the direct payment. Ifa person does not have the capacity to consent to a direct payment, Department ofHealth guidance1 allows a suitable representative to receive and control a direct paymenton the person’s behalf, subject to certain criteria. This is similar to the ‘suitable person’process in social care.

1.5 Direct payments can be managed in a number of ways:

. Paid directly to the person, into a designated bank account, which is only used forpurchasing care and support to meet the needs and outcomes specified in the care orsupport plan. The commissioning organisation must agree access to this money byany other person.

. Paid into an account managed by a ‘third party’ (another person, such as a friend orrelative, or a non-NHS organisation – for example, a ‘direct payment support service’,user-led organisation or Credit Union) and for use solely under the direction of theperson receiving the direct payment (including a nominee or a representativereceiving a direct payment) in accordance with the care or support plan. In this case,the money is managed by the agency or individual; but the purchasing of care andsupport and therefore contracts for care and support remain ultimately theresponsibility of the direct payment recipient.

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1 For more information on requirements for representatives, see page 17 of the Department of Health’s

guidance Direct Payments for Health Care; Information for Pilot sites:

www.dh.gov.uk/en/Publicationsandstatistics/Publications/PublicationsPolicyAndGuidance/DH_117477

. Paid into a bank account held by a nominee or representative (often a friend orrelative), who has an agreement with the commissioning organisation to manage thedirect payment. This bank account must be separate from the nominee’s orrepresentative’s other accounts, and be used only for purchasing care and support tomeet the needs and outcomes specified in the care or support plan. The nominee orrepresentative is responsible for fulfilling all the responsibilities of someone receivingdirect payments.

. Paid onto a pre-paid card. This is similar to a debit card. Because a pre-paid card is notwholly controlled by the individual and cannot be used as flexibly as money in a bankaccount, this can only be regarded as a form of direct payment if the person has thefree choice to alternatively receive their money in the ways described above and haschosen a pre-paid card as their preferred option. This arrangement must give theindividual the necessary freedom to use the card to purchase care and support tomeet the needs and outcomes specified in the care or support plan. Kent CountyCouncil has one of the longest established pre-paid card systems which is a popularoption for direct payments recipients.2

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Case study – employing a personal assistant

Margaret lives in an adapted bungalow with her parents. She has not had any formal care orsupport until now, as her parents have provided for all Margaret’s support needs. As Margaret’smother is getting older and is herself no longer in good health the family have worked togetherto plan for the future. Following an assessment Margaret was offered a joint health and socialcare budget. She has used this to put in place a plan that will mean she no longer relies on herparents 24 hours per day. She employs two personal assistants for 26 hours per week. Herpersonal assistants provide support with personal care, attending GP and hospitalappointments, shopping and other activities.

Margaret says that her budget has made a big difference to her life. She did not want to use ahome care agency, as this would mean a lot of different carers who did not know her wellcoming in and out of her parents’ home. Her personal assistants enable her to lead the life shewants to, without relying on her family. This makes her feel independent and in control of herlife.

2 Kent County Council – the Kent Card:

www.kent.gov.uk/adult_social_services/your_social_services/your_money/direct_payments/kent_card.aspx

What are direct payments?

Chapter 2: Other ways of delivering personal health budgets

2.1 Direct payments are one way in which health and social care bodies can make PHBsavailable to people but they are not the only option. A parallel paper to this guidance –Resource Deployment Options for Personal Health Budgets3 published by the Departmentof Health – explains in detail how direct payments sit alongside other ways of givingpeople PHBs. There are two additional ways in which health bodies can deliver PHBs – asnotional payments or via a third party arrangement. All PCTs can offer notional or thirdparty budgets, but only approved Department of Health PHB pilot sites can currentlyoffer direct payments. Subject to the results of the evaluation of the PHB pilotprogramme it is hoped that direct payment powers will be extended across England in2013.

2.2 In some instances it may be appropriate to offer a mixture of different methods fordelivering a PHB – for example, if someone would like to try out a direct payment but isnot yet sufficiently confident to manage their whole budget in this way or where aperson wishes to retain an existing NHS service to meet part of their needs, and to meettheir remaining needs in a way not provided by the NHS.

2.3 There are some methods of payment that appear to be direct payments but on closerinspection may not meet the criteria to count as such. For instance where directpayments are made via pre-paid cards which can only be used with prescribed providers,or where money is not held in an account which the individual has full access to.Likewise where unnecessary conditions are placed on the use of a direct payment so thatthe money can only be spent on specific services and/or specific providers of servicesthen this may also not constitute a direct payment. For more on this see chapter 4 belowwhich looks at what direct payments can and can’t be used for.

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3 Resource Deployment Options for Personal Health Budgets, Department of Health, 2011:

www.personalhealthbudgets.dh.gov.uk/Topics/latest/Resource/?cid=3430

Chapter 3: How to cost direct payments

3.1 Calculating the amount of a direct payment can be achieved in a number of differentways, each of which has its own merits. There are three common ways in which this istypically done:

a. By calculating how much is currently spent on services to the individual andconverting this into a direct payment. This is a useful approach where people arealready receiving a service and the cost of that service is easily ascertained. Thismethod has been used successfully in pilot sites working with people with existingNHS continuing healthcare packages.

b. By estimating the value of the NHS services that would normally be offered to theperson, taking account of their identified health needs. This is a useful approachwhere people are being newly assessed and services are not yet in place. Forexample, if following an assessment of someone’s needs, a commissioningorganisation judges that the cost of meeting these needs would usually beapproximately £120 then the value of the direct payment can be based on thatinformed assumption. Such judgments can reasonably be made on a case by casebasis but the rationale for the assumed cost should be documented in brief duringthe assessment process so that the value of the later offer of a direct payment canbe understood and can stand up to challenge.

c. By using an assessment tool, which looks at the outcomes to be achieved, and thelikely average cost of achieving them. This is a useful approach where there is someexperience of how people can meet their needs and time to develop a moreoutcomes based approach. For example, the decision support tool has been used tohelp calculate budgets for people eligible for NHS continuing healthcare.4

3.2 Most approaches to setting budgets are accurate in no more than about 80% of cases. Itis always advisable to have some in built flexibility whichever approach is used in orderto ensure that commissioning organisations can satisfy their legal duties to ensure thatpeople have adequate resources to meet their eligible needs. To ensure that the budgetallocated is a good fit for what is required to meet the needs and outcomes outlined inthe plan, there should be a sign-off process to agree both the care or support plan andthe budget. There should also be a review within three months of the budget beingawarded (see chapter 4). This can help minimise the risk of people receivinginappropriate or inadequate amounts of money. In many cases people are able to usedirect payments to meet their needs more cost effectively (as the example below shows)however, the main benefit is the enhanced control and the improved outcomes peopleexperience.

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4 A guide to setting personal health budgets for people who are eligible for NHS Continuing Healthcare,

Department of Health 2012. Please note that at the time of writing, a parallel paper to this guidance was

being developed by the Department: it will be available shortly at:

www.personalhealthbudgets.dh.gov.uk/topics/index.cfm?tag=Good practice guides

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Case study – meeting needs cost effectively

Annabel has muscular dystrophy and needs support with breathing, eating, moving aroundand continence. She has opted to manage her personal health budget as a direct payment.

Her budget enables her to maintain control over her care. The budget can be used flexibly, notjust for personal care.

Annabel has a motorised bed, which enables her to keep in the correct position to preventmuscle spasms and keep her ventilator mask in place. The flexibility of her personal healthbudget came in handy when one of the bed’s three motors failed on a Friday evening.

Using her personal health budget, Annabel was able to buy an ex-display model of the samebed direct from an equipment retailer, complete with warranty and maintenance contract. Thebed was delivered and set up on the Saturday afternoon, so Annabel could sleep in it on thatnight. Annabel challenges the NHS to be able to respond this quickly.

Before taking up the direct payment, Annabel lived in residential care a long way from home,at a cost of £156,000 per year. The personal health budget costs £26,000, and has enabledAnnabel to live at home with her husband, to keep up with friends, and have an active sociallife. Annabel feels that her personal health budget is much more flexible and responsive thanservices commissioned by the NHS could ever be.

Practical Guide: Direct Payments for Healthcare

Chapter 4: How direct payments for healthcare can be spent

4.1 Once a care or support plan has been developed and the commissioning organisationhas signed off the plan a direct payment can be made.

4.2 The care or support plan itself must contain a specified set of information including howthe person intends to meet their health needs and their broader health and wellbeingoutcomes and what services or goods will be purchased to do so (see appendix ii for thefull set of information required in a plan).

4.3 In agreeing a care or support plan the commissioning organisation must be satisfied thatthe goods or services which the person intends to buy (as listed in the plan) will meetthe individual’s health needs and their broader health and wellbeing outcomes. Theymust also ensure that the amount of money offered will be sufficient to meet the costsof those goods and services. The individual receiving the direct payment or theirnominee must also agree to the plan. Commissioning organisations should be openminded when reviewing plans and not look to exclude things simply because theyappear unusual.

4.4 Existing guidance to pilot sites points out that direct payments do not circumventexisting guidance, for example relating to National Institute for Health and ClinicalExcellence (NICE) approval. Where NICE has concluded that a treatment is not costeffective, commissioning organisations should apply their existing exceptions processbefore agreeing to such a service. However, where NICE has not ruled on the costeffectiveness or otherwise of a specific treatment, commissioning organisations shouldnot use this as a barrier to people purchasing such services, if it may meet their healthand wellbeing needs.

4.5 During the planning process it is important that people have the opportunity to makechoices about the goods and services which they use and should be offered support atthis time to help them explore what might be right for them. It is important that peoplehave permission to purchase things that can achieve good outcomes for themselveseven if such goods and services have not previously been provided by the NHS. See thecase study at the end of this section for an example of an innovative use of directpayments.

4.6 However, there are some activities/items that a person cannot use a direct payment for,specifically:

. To purchase primary medical services provided by GPs, such as diagnostic tests, basicmedical treatment or vaccinations

. To purchase alcohol or tobacco or for gambling

. To cover urgent or emergency treatment services, such as unplanned in-personadmissions to hospital

. To make debt repayments

. To purchase goods or services where the commissioning organisation believes thebenefits are outweighed by the possible damage to someone’s health

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. To purchase goods or services which are unlikely to meet the agreed outcomes, orwhere the cost is substantially disproportionate to the potential benefit

. To pay a close family carer living in the same household except in circumstanceswhen ‘it is necessary to meet satisfactorily the person’s need for that service; or topromote the welfare of a person who is a child’5

. To employ people in ways which breach employment regulations or to purchaseanything else which is illegal. It is good practice to ensure that people taking updirect payments have access to a local direct payment support service. These servicescan help people to be good employers and meet their legal obligations. DisabilityRights UK holds information on local services supporting people to use directpayments and produces a wide range of information for people needing advice onusing direct payments or finding a local support service – see its website for moreinformation: www.disabilityrightsuk.org. More information on direct payment supportservices can be found in chapter 7.

4.7 Where the commissioning organisation is not satisfied that a plan is suitable for sign offit should inform people why that is the case and offer them support to review andamend their plan or to appeal the decision should they wish.

4.8 The plan is the key document which both the direct payment recipient or their nomineeand the commissioning organisation must agree and sign off before a direct paymentcan be made. It is therefore vital that it contains all the information required. Plans mustalso be reviewed at appropriate intervals starting at three months and then at leastannually. In taking the direct payment, the recipient or their nominee must agree to thereview and understand that part of that process may include a reassessment of their needs.

4.9 In addition to the care or support plan, it has been common practice in social care tohave a separate direct payment agreement.

4.10 If such an agreement is required it is important to keep it as simple as possible. Most ofthe information needed for sign off should be gathered by a care or support plan. Theadditional items which direct payments agreements have typically included which maynot be in a care or support plan are:

. Information about how disputes will be managed and under what circumstances apayment may be withdrawn

. Details of how any unused money will be dealt with

. Details of how the direct payment will be delivered, how often and by what means(for example, via direct debit to a specified bank account)

. The bank account details which the money is to be paid into (this must be set up forthe person to receive the payment into a personal bank account)

. If the direct payment is a one off payment, how it will be paid

. What other monies can be put into a direct payment bank account

. Under what circumstances money will be reclaimed.

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5 Paragraph 83, Direct payments for healthcare: information for pilot sites, Department of Health, July 2010:

www.dh.gov.uk/en/Publicationsandstatistics/Publications/PublicationsPolicyAndGuidance/DH_117477

Practical Guide: Direct Payments for Healthcare

4.11 Commissioning organisations should consider having one process for signing off a directpayment ensuring that any additional information required over and above the care orsupport plan is introduced in a simple agreement at the same time and that the processof agreeing the payment is as seamless as possible. Where people have a mix of healthand social care funding, a single direct payment agreement is preferable and effortsshould be made to merge the sign off requirements into a single document. An exampleagreement is included in appendix iii. The process that one pilot site uses to set up ahealthcare direct payment is also included as appendix i. The process for signing off adirect payment should be clearly documented and communicated to people so thateveryone understands what is expected of them.

4.12 Commissioning organisations should consider keeping the sign off process as simple aspossible. Many organisations have developed panel arrangements to sign off care andsupport plans and agree direct payments. These involve bringing together key staff andstakeholders with knowledge and expertise of direct payments to agree sign off andensure decisions are recorded and explained. This can be a useful approach and learningtool, particularly when key staff are new to working with direct payments. However,although such panels can be useful in the early stages of developing a direct paymentsinfrastructure, they can also be very resource intensive and bureaucratic and slow downdecision making – they should therefore be used judiciously. It should not be necessaryfor all direct payments to be signed off by a panel. Instead, the person acting as care-coordinator or a team manager may be best placed to do so. Where there are queriesover whether plans are suitable, panels can be helpful in ensuring that responsibilitydoes not rest with a single person. Panels making decisions should operate in line withclear pre-set governance rules and ensure that decisions are recorded along with thereasons behind them and that these are communicated promptly to the peoplerequesting the direct payment. Commissioning organisations should also ensure thatpeople have an opportunity to have their views heard in the decision making process.

4.13 During the approval process a date should be agreed for when payment needs to beginand when payment will actually be made. Once approved, commissioning organisationsneed to ensure that direct payments can be paid on time to avoid the risk of peoplebeing left without access to essential support. Payments can be made in a number ofways (see chapter 1). Delays can sometimes happen if the person is setting up a bankaccount to receive payments. Direct payments support services can offer support to helppeople through this process where necessary.

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How direct payments for healthcare can be spent

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Case study – innovative use of direct payments

John has been a wheelchair user for some 15 years following a motorcycle accident. He hasused a direct payment from social services to employ personal assistants. This means he canarrange support at times that suit his lifestyle – such as getting up at 11am, and going to bedat 1am.

John has tried using chairs provided by the NHS and those available using the NHS voucherscheme. However none of the chairs has stood up to the demands of John’s active lifestyle formore than a few months. Over 7 years ago John decided to build his own wheelchair, using hisengineering skills and money from his state benefits. This left John short of money, so his housebegan to fall into disrepair.

John was offered a one-off personal health budget, equivalent to the value of an NHSwheelchair. He took this as a direct payment and has used the money to buy parts to build apowered wheelchair that he can use outdoors. He can now take his dog for walks on the beachand through the woods, without fear of getting stuck. His chair can also get past obstaclessuch as the ramp into his local pub that defeated the NHS chairs. Having the personal healthbudget has also meant that John can use his own money to replace torn carpets with lino andget his skirting boards repainted.

His personal health budget has cost the NHS £6,000 over 3 years. The previous cost to the NHSof the many replacement wheelchairs is not easy to estimate, but is likely to be more.

Practical Guide: Direct Payments for Healthcare

Chapter 5: Integrating direct payments between health andsocial care

5.1 A number of PHB pilot sites have undertaken focused work around integration, with theaim of testing out ways of merging health and social care budgets to improve the userexperience and to simplify and join up systems and processes. Some of these sites havealso delivered direct payments for people with a mix of health and social care funding.Approaches to integrating direct payments have been varied but a common feature hasoften been the shared use of existing direct payment support services. All areas wheresites are operating have some history of delivering support services to people usingdirect payments for social care. For example, Oxfordshire has developed a service aimedat supporting the employees of people using direct payments with a programme ofworkforce development called ‘Support with Confidence’.6

5.2 Some PHB sites are moving towards integrating support planning and review functions,and are aiming to develop single support planning and review tools which can supportintegrated working between social care and healthcare professionals and provide joinedup information to people using direct payments. Although at an early stage, there is acommon recognition that finding ways of merging and streamlining these processes willbe necessary for dealing with larger numbers of people.

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6 Oxfordshire’s Support with Confidence scheme:

www.supportwithconfidence.gov.uk/

Chapter 6: Monitoring and reviewing direct payments

6.1 Direct payments are public money and commissioning organisations have a responsibilityto ensure they are used to meet the health needs and the broader health and wellbeingoutcomes of those to whom they are given. Commissioning organisations also have aresponsibility to effectively manage the risks associated with people using health directpayments including minimising the risk of fraud and the risk of money being used inways that are either illegal or otherwise prohibited or do not work towards meetingpeople’s health outcomes.

6.2 In managing these risks it is important that the uses of direct payments are not overlyprescribed and that as far as possible people are supported in the choices they make.It is important to make clear from the start what people can and cannot spend theirmoney on and to ensure that people receiving direct payments understand theserules.

6.3 People can get much added value from using money flexibly to meet outcomes in waysthat suit them as an individual and prohibiting flexibility compromises the purposebehind health direct payments.

6.4 Where people have tried things that may not have been as effective as intended it isimportant that the commissioning organisation does not automatically assume that thedirect payment is not working. Care co-ordinators should work with people to learn andadapt and to use experience of what works and what doesn’t to influence future plans asto how a direct payment can be most effectively utilised.

6.5 In addition, it is important when deciding how payments should be monitored to take aproportionate approach, which takes account of the specific risks relating to eachparticular individual and situation. CIPFA guidance 7 issued in 2007 supported thisapproach, but beyond the need to reflect good practice there is also a financialincentive to ensure monitoring processes do not take up disproportionate amounts oftime and resources. Many local authorities have developed a proportionate approachto monitoring direct payments because it has proved costly and inefficient to collectroutine monthly or quarterly returns for large numbers of people. In 2009, LincolnshireCounty Council decided to move to a lighter touch and outcomes focused approachto monitoring, allowing them to more accurately identify and quantify risks. Theyfound an outcomes approach required significantly less detailed information acrossthe board and were able to reduce the frequency of monitoring for people who wereconsidered to be low risk. The savings to back office systems and frontline staff time

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7 Direct Payments and Individual Budgets: Managing the Finances, CIPFA, 2007:

www.cipfa.org/Policy-and-Guidance/Publications/D/Direct-Payments-and-Individual-Budgets-Managing-

the-Finances

were significant and as a result of this move the council reported cashable savings of£130,000 in the following year.8

6.6 Traditionally monitoring direct payments has tended to focus on whether the money isbeing used in ways that are outlawed, so as to guard against fraud, and whether there isany money which is unused, so as to ensure money can be recouped at the end of theyear if it is not needed. It is good practice to carry out an outcome-focused review afterthree months, and then at least annually, which looks at how the PHB has been used tomeet the person’s identified health needs and achieve the agreed outcomes. Financialmonitoring should take place at the same time, rather than as a separate process. Joiningup the two processes can save time and give a more rounded picture of whetherresources are being used effectively. Advice on how to carry out outcome-focusedreviews is available on the Think Local, Act Personal website.9

6.7 Where it is found that people appear to have wilfully made inappropriate use of themoney a care-coordinator should work with the person to understand why this hashappened and to consider whether further action needs to be taken to recoup monies.The commissioning organisation should develop a clear process for setting out how andunder what circumstances money would be reclaimed from people making sure theydon’t penalise those who have made a genuine mistake. In addition, where people stillneed services, a decision will need to be made as to whether those needs should be metthrough notional or third party arrangements rather than via a direct payment.

6.8 If someone is holding a significant amount of unused money from his or her directpayment and where this is not allocated for a particular purpose, this may be anindicator that a reassessment is appropriate. However, it is important that people areallowed to hold a certain amount of money for contingencies.

6.9 It is also important to take account of the potential for people to suffer from neglect orabuse. Although there is little evidence to suggest so far that people using directpayments are more at risk than people receiving direct services, it is important that theplanning process explores what needs to happen to keep someone safe and how riskswill be monitored over time. A good review process is an important safeguard againstabuse.

6.10 It is also important to understand whether outcomes have been met and to gatherinformation about this during the review stage. This should be the primary focus of thereview and provides a platform for understanding how plans may need to change andadapt to be effective.

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8 Practical approaches to improving productivity through personalisation in adult social care, Putting

People First, December 2010:

http://www.puttingpeoplefirst.org.uk/_library/Practical_Approaches_doc.pdf9 Think Local, Act Personal website:

www.thinklocalactpersonal.org.uk/Browse/

Monitoring and reviewing direct payments

6.11 In addition to the review, there are a number of tools that can be used to look ataggregate information about how far and how effectively people are managing toachieve outcomes. The national charity In Control10 is working with a number of PHBpilot sites to develop a specific outcomes evaluation tool, which can capture informationfrom people using PHBs (including direct payments) about their experiences. Suchinformation will be considered an invaluable asset in any analysis of the costeffectiveness of health direct payments.

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10 In Control: www.in-control.org.uk/

Practical Guide: Direct Payments for Healthcare

Chapter 7: The role of direct payment support services

7.1 The National Health Service (Direct Payments) Regulations 2010 state that a PCT (infuture CCGs):

‘Must make arrangements for a person, representative or nominee to whom directpayments are made to obtain information, advice or other support in connection withthe making of direct payments’.

7.2 In addition it lists some of the types of information, advice and support which may needto be provided including advocacy services, support to commission services for anindividual and employment related advice and support such as payroll services for thosepeople who may wish to use their direct payment to employ staff directly. Collectivelythese are referred to as direct payment support services. In practice, many PHB pilotschemes making direct payments are using the often well-established support serviceswhich exist for social care direct payments users, many of which also provide support topeople with a wide variety of support needs. Others are supplementing these withspecific training services to ensure that where people recruit staff directly to supportthem with their health needs, such staff have quick access to relevant training fromsuitably experienced or qualified staff. As mentioned earlier, Disability Rights UK canprovide details of local support schemes: www.disabilityrightsuk.org.

7.3 The learning from the PHB pilot sites suggests that it makes sense to use existing localdirect payment support schemes. There may be a need to work with the local authorityto invest in building the capacity of the direct payment support service. If this is done,there is no reason why such services cannot provide support to health direct paymentsusers just as well as they do to social care direct payments users. For example, CheshireCentre for Independent Living offers an extensive range of support to existing andpotential direct payments and PHB recipients, including a managed account service toassist people who may have trouble looking after their own finances; bespoke trainingcourses delivered in employers own homes and a North West Personal Assistant Registerdelivered in partnership with Age UK Cheshire.11

7.4 Direct payment support services can also help with the practicalities of setting up bankaccounts for people. Many local authorities offer people using direct payments theoption of a pre-paid card, which can make setting up accounts much simpler.Commissioning organisations should consider how they can work with their localauthority partners to offer the same options and support for people in setting upbanking options for direct payments.

7.5 A recent paper published by the Think Local Act Personal Partnership – Best practicein Direct Payments Support: A guide for Commissioners – explores what an ideal

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11 See www.cheshirecil.org and www.nw-pa.org

support service should provide for people using or thinking of using direct payments.The paper was developed with commissioners, people using direct payments anduser-led organisations and offers a useful template for benchmarking local supportservices.12

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12 Best Practice in Direct Payment Support: A guide for commissioners, 2012:

www.thinklocalactpersonal.org.uk/BCC/Latest/resourceOverview/?cid=9235

Practical Guide: Direct Payments for Healthcare

Chapter 8: Concluding thoughts

8.1 Direct payments are here to stay. In social care they have proven to be a highly effectiveway of increasing the choice and control people can have over their care and support.Evidence from the PHB pilot sites is already showing that the same is true for healthcaredirect payments. When people are supported to take a direct payment and makearrangements to meet their health and wellbeing needs they typically get betteroutcomes at least as cost effectively.

8.2 Evidence from people using personal budgets, their carers and from frontline staff alsotells us that the process of getting a direct payment can often be overly complicated andoff-putting. To make a success of healthcare direct payments, all stages of the processneed to be simple and transparent and assessment, monitoring and sign off processesneed to be proportionate and straightforward. Finance managers have a key role to playin making sure this happens and helping realise the potential benefits of healthcaredirect payments to improve people’s health and wellbeing.

8.3 At the time of writing, the detail of how direct payments and PHBs will be rolled out isyet to be finalised with the results of the evaluation due to be published in October2012. Readers are advised to check the Department’s web pages on direct payments forupdates and guidance: www.personalhealthbudgets.dh.gov.uk

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Appendix i: Example personal health budget team financialprocess

1. Person approved for PHB by PCT and PHB team (PHB team members and ProgrammeDirector)

2. Person completes direct payment contract and returns to PHB team office3. PHB team verify direct payment contract and bank account details with person (PHB team

member to phone person)4. PCT section completed by PHB team office and signed by PHB team budget manager

(Programme Director to sign)5. Contract/bank details scanned and copied on the system via PHB team administrator6. Completed bank account form/contract7. Emailed to PCT accounts team and PHB team to set up ‘dummy’ invoice8. NHS Shared Business Services (SBS) scans in and sends invoices on Oracle for Programme

Director to sign off on Oracle system9. Invoice is then processed to be paid by SBS on every Thursday. Should be paid within

three working days10. Person receives payment via BACS into their separate bank account or a bank account

established to receive SSD direct payment funds11. Copied bank statements and proof of purchased services received from person (monitored

by PHB team)12. Person is followed up at 6 week/6 month and annual review (PHB team member).

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Appendix ii: A checklist for what must be included in a care orsupport plan

[Extracted from pages 22–23 of Direct Payments for Health Care: Information for pilot sites,Department of Health, 2010]

Before a direct payment can be made, the PCT must ensure a care or support plan isdeveloped and that the plan sets out:

a. The health needs and outcomes to be met by the services in the care or support planb. The services that the direct payment will be used to purchasec. The size of the direct payment, and how often it will be paidd. An agreed procedure for managing significant potential riske. The name of the care co-ordinator responsible for managing the care or support planf. Who will be responsible for monitoring the person’s health conditiong. The anticipated date of the first review, and how it is to be carried outh. The period of notice that will apply if the PCT decides to reduce the amount of the direct

payment.

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Appendix iii: Example healthcare direct payment contract

Person agreement(personal health budget/direct payment contract)

v I agree to only use my personal health budget/direct payment to buy the services asdetailed in my support plan, and any related expenses that have been agreed with_______________. I will not misuse the money in any way. The product or service asagreed is for ________________________________________________________________and the money to be paid is ______________________________ which is a one-offpayment and/or ongoing payment of ___________ [delete as appropriate].

v I understand that my support plan and direct payment will be reviewed every 3 months,and if I am assessed for different services I may be re-assessed for direct payments.

v In accordance with _____________ financial monitoring policy, I agree to open adedicated, separate bank account for the payments and send copies of bank statementsto the PHB programme office every 3 months. For a one-off purchase I will send thereceipt or invoice to the same office.

Or �

v I will use a bank account already set up to receive direct payments from _____________Council and send copies of bank statements to the PHB programme office every3 months. For a one-off purchase I will send the receipt or invoice to the same office.

Or �

v I will ask a third party ____________________________________ to act as my agent byholding the money on my behalf.

(�Please delete as applicable)

v I agree that I (or my agent) will send ___________ , PHB programme office details ofhow the money has been spent at intervals of ___________ or otherwise as requested.This refers to ongoing payments and not one-off payments.

v I agree that I will meet all legal requirements and obligations relating to the services Ipay for using my direct payments.

v I agree to take out employer’s and public liability insurance if I am employing my ownstaff. The direct payment will cover this cost.

v I agree that I will not use my direct payment to employ my partner (married or not) orany of my close relatives who live with me. This means a parent, parent-in-law, aunt,uncle, grandparent, son, daughter, son-in-law, daughter-in-law, step son or daughter,brother, sister, or the spouse or partner of any of these. (In exceptional

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circumstances, relatives may be employed, but only by prior agreement with___________________ )

v I understand that _______________ strongly recommend that I should ask forappropriate checks to be made through the Criminal Records Bureau on all myprospective employees.

�I intend to seek CRB Checks for my employees

OR

�I do not intend to seek CRB Checks for my employees(�Please delete as applicable)

v I understand that _______________ has the right to stop my direct payment if theydecide that my employee or care provider is unsuitable.

v I understand that I can stop my direct payment by giving four weeks’ notice and agreeto repay any unspent money.

v I will be given at least 4 weeks notice by _______________ of any suspension orstoppage of my direct payments and advice about what I can do to prevent thishappening.

v In the case of equipment or products, I agree to maintain and safely look after the itemand insure as necessary to prevent from theft or damage.

I understand that if I do not keep to the above terms and conditions _______________may stop the payments and I may be required to return all or part of the money I havereceived.

Signed: ______________________________________________________

Print name: ___________________________________________________

Dated: _______________________________________________________

Bank account details

Persons approved for a healthcare direct payment must complete the following bankaccount details form to ensure prompt payment can be made. Please note: thisinformation will be stored in the strictest confidence and in accordance with the DataProtection Act, 1998.

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Example healthcare direct payment contract

Person name

Person address

Account number

Sort code

Bank account name/address

Is this account separate to yourpersonal bank account?

Is this account set up to receivesocial care direct payments fromyour council?

Do you consent to the PCT makingpayment?

FOR PCT MANAGEMENT COMPLETION ONLY:

Frequency of payment agreed

Date of first payment

Type of payment

Purchase agreed

Confirmed account is separate toperson’s personal bank account

Budget holder authorisation –name and signature is required

Date

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Practical Guide: Direct Payments for Healthcare

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