Adding Value?
This briefing looks at how Payment by Results (PbR) is applied to interventions for people facing multiple and complex needs. It raises a number of considerations for policymakers and commissioners looking to fund services for this group. The use of PbR models has been increasing across the public sector as a way of funding public services. It is being employed by national and local commissioners as a way of tackling entrenched social problems across a variety of policy areas.
While few disagree with a more outcome-focused approach to the commissioning of public services, the implementation of PbR models has proved challenging and controversial. Particular difficulties have arisen in relation to those facing more complex problems. It is important to learn lessons from how PbR has been applied to services for the most vulnerable people. Informed by stakeholder roundtables and a review of key literature on existing PbR schemes, this report is part of our SPARK project of research and dissemination. It highlights some of the key challenges in applying PbR approaches to this group and considers how some schemes have sought to overcome them.
It raises key considerations in five areas:
- Setting outcomes that incentivise a holistic, person-centred approach
- Ensuring outcome measurements and targets reflect the need for longer-term, flexible interventions supporting the recovery journey
- Setting payment structures that support investment in an intensive, assertive approach that helps to build a strong foundation for recovery
- Promoting a ‘joined-up’ approach
- Considering alternatives to PbR.
PbR is not always appropriate, and significant challenges remain in applying it to services for those facing multiple and complex needs. Commissioners should have a clear rationale for using it and learn from the experience so far, considering alternative ways of supporting an outcome-focused approach.
