Income at Risk: Why NHS Income Systems Must Evolve 

Insights from Helen Cookson, NHS Payment System and Contracts Consultant. 

I was recently asked to reflect on my time working in the income sphere within the NHS. I started my career in the equivalent of a band two position and have worked in both provider and commissioner organisations ending up in Associate Director of Finance roles.

I have lived the monthly grind of delivering contract monitoring reports and income reports for internal uses. I know that feeling of submitting flex and freeze reports with minutes to spare desperately hoping that all the data quality issues have been resolved. With the expected policy changes in NHS income, it feels like a good time to share what I have learnt from my experiences, especially the ‘what would I do differently based on what I know now’.

Why now

I have worked across many organisations and have utilised many solutions for income processing. I can clearly see how important accurate and efficient income systems are for the NHS. In an environment where it is necessary to be more efficient, improve productivity and to reduce waste, is now coupled with a necessity for high quality accurate and timely data, how a trust processes its activity and produces income reports has become even more vital.

The reintroduction of activity-based payments across some but not all lines of activity for some but not all commissioners has increased the complexity for providers in producing accurate and meaningful income reports. Income monitoring is no longer a hidden BI function; it's frontline finance with a direct impact on patient care.

The key things I now know that I wish I’d known at the start of my career: 

The greater the number of touchpoints in the data, the greater the risk of error.

The more systems, spreadsheets and touchpoints that there are between the source data and the commissioning reports being posted on to the DLP, the greater the risk of error in the reporting. In the early days, we worked across a patchwork of tools, Access databases, Excel macros, and bespoke scripts, all stitched together by well-meaning teams. But every extra step meant another place for something to go wrong. When income figures were finally reported, it was often a scramble to trace back what went wrong and where. If I’d known that this complexity could have been avoided with the utilisation of a single solution, I could have saved a lot of time and increased the credibility of our data.

Processing is Overrated: Understanding is Where the Value Lies.

Speeding up flex submissions is nice, but stopping errors before they happen is better. Much of my team's time was spent preparing data for submission, only to spend the following weeks responding to commissioner challenges. It wasn't until we started shifting focus from ‘producing’ reports to understanding them that we really started adding value. The best insights came from asking better questions about the data, like why are outpatient attendances so different to previous months or why has the average spell tariff changed so much.

Bespoke Feels Powerful - Until the Person Who Built It Leaves.

If your income process depends on one person’s spreadsheet, you don’t have a system - you have a risk. I’ve seen entire workflows grind to a halt because the one person who understood “how the model works” went on leave, or worse, left the Trust entirely. I have also seen a repeat of what is done without any understanding or adjustment when the rules change, because the person who set it up left and no-one understands why. We built tools tailored to our processes, but forgot to build in resilience. What looked like a strength, a custom setup, turned out to be a weakness. 

The most common challenges I have encountered with Income processes

1. Most of the resource is spent on producing the month end reporting and then dealing with the errors in it before the next monthly cycle. This leads to sub optimal use of resource and increased commissioner challenges.
   
   
2. The up to the wire approach to Income Monitoring, means that there is insufficient time to check the data and rectify data with coding issues, missing data and mapping errors, all of which can lead to a loss of income and a lack of trust from both internal and external stakeholders in the validity of the data produced.
   
   
3. With all the resource focused on producing the data, there is no time to undertake added value tasks, such as an analytical review, trend analysis and discussing performance with clinical and operational colleagues to gain an understanding of the data, including supporting the services to improve the capture of data at source
   
   
4. In situations where the income team are only able to be reactive, commissioners end up dictating what the income team are doing. This leads to teams being tied up with queries which are either without merit or could have been avoided if time had been available to understand the issue and correct it before reporting or an explanation provided to commissioner.
   
   
5. Significant amounts of time are spent trying to reconcile datasets used for SUS, costing and income, as well as statutory reporting and operational data used by services. In many cases reconciliation is not possible due to the complex patchwork approach to the data used for the various returns and internal reporting mechanisms.