Payment-by-results ‘might not work for most vulnerable people’

5 Feb 15
Government and councils have been urged to consider how expansion of payment-by-results systems to pay for public services can work for vulnerable people with multiple needs.

By Richard Johnstone | 5 February 2015

Government and councils have been urged to consider how expansion of payment-by-results systems to pay for public services can work for vulnerable people with multiple needs.

In a briefing, the Revolving Doors Agency, a social enterprise that helps people with complex problems, said there was a risk that increasing use of the contracts, such as in the coalition’s flagship Work Programme, could hinder integration.

Use of the contracts has been expanded by the coalition government after Prime Minister David Cameron pledged to place the initiative at the heart of the government’s open public services drive.

However, today’s Adding Value? report said greater thought needed to be given to how PbR schemes can be applied to services working with individuals facing problems including poor mental health, offending, substance misuse and homelessness.

It warned that the approaches, which also apply in the council-led Troubled Families programme, could lead to a short-term focus on outcomes rather than on long-term recovery. People with more complex problems could be ‘parked’ as providers target easier cases to ensure they get paid.

To address these concerns, the charity called on commissioners to ensure the focus on outcomes includes a ‘whole system’ view to ensure resources from different services could be pooled around shared outcomes.

Service users must be involved in setting outcomes, and PbR should also measure what the report called ‘the distance travelled’ towards outcomes rather than only paying on specific targets.

If this was not possible, commissioners should consider alternatives to paying by results while maintaining a focus on cost-benefit to the system as a whole.

Vicki Helyar-Cardwell, director of research and development at Revolving Doors Agency, said that few people could disagree with the principle of payment for outcomes.

‘However, the reality of implementing these approaches is more complex, and how results are defined and funded varies greatly between different PbR schemes,’ she said.

‘Our review shows that significant challenges remain in applying PbR to people facing multiple and complex needs, who require more flexible, intensive, and holistic support to overcome what are often entrenched problems. Where commissioners and policymakers are seeking a more outcome-focused approach, they should reflect on the experience of the existing PbR schemes highlighted here and consider alternative ways of driving a greater focus on the outcomes that matter most to clients.’

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