Review of new incentive contract

Providers and commissioners of health care have in recent years explored opportunities for new forms of contract that are designed to help align incentives and manage cost more effectively. These contracts move away from traditional models for funding NHS services, such as activity based PbR, and move towards capitated payment models that are linked to agreed outcomes.

While these new contract offer to reduce frictions between organisations and help re-focus attention on the delivery of care, they can represent significant changes to the status quo and this can result in additional uncertainty and risk. These changes and risks need to be understood in advance of progressing with these new contracts, so that they do not fail.

Edge Health were commissioned to undertake an independent review of a new contract design in the South of England ahead of it being formerly signed off and initiated. To do this, the Edge Health team undertook an in depth review of the proposed contract and financial modelling, and also met with a all key stakeholders to understand their concerns and hopes for the new contract.

The work produced a detailed review of the proposed contract, including potential risks and opportunities. This report helped to support the health system to agree to progress with the new contract, which is now in the process of being implemented.