How savvy social enterprises can grow in the public sector

Outcomes-based commissioning is here to stay. On Purpose associate Seigo Robinson explains why and shares his six top tips for social enterprises to best postition themselves for these contracts.

Allow me to tell you a story, one that is entirely fictional but I think believable: 
Valerie, a capable and independent minded elderly lady is living alone at home. One day she develops a urinary tract infection which makes her incontinent.  In her confusion and worry at her state she has a fall. She lies dazed and semi-conscious for a day before somebody notices and calls her doctor. Her GP promptly assesses the situation and calls for an ambulance to come and get her which arrives sharply and takes her to hospital. The clinician diagnoses the issue quickly and puts her immediately on a course of antibiotics and commits to check-in weekly. Nurses take good care of her while she is moved from ward to ward to concentrate care around consolidate bed spaces. However, out of her usual surroundings, she becomes tired and confused and makes slow progress and ends up staying for a month. Finally on discharge, the consultant recommends her to be moved to a care home where she would be safer than living at home alone in her current state of mind and frailty.
Now, consider that the outcome most often cited by the elderly is that they want to feel more independent after each NHS interaction. Clearly, this is not the achieved result in the above example even though everybody did their job correctly.  
Why did this happen? Healthcare systems the world over have created silos in which the patient has become the product in a lean manufacturing plant with each worker being highly efficient at passing the product on but with no skin in the game for the quality of the product. 
So what’s the cure?
It’s generally agreed that integrated (or “joined up”) care is the way forward. We need to ensure that the healthcare services that are provided focus on the patient and old silos are joined up. What does this mean in practicality? It means that IT systems allow easy viewing by the clinician of the GP’s comments about Valerie’s usual independence and ability to live at home alone. The GP would follow-up with a call to the clinician giving them the confidence to discharge her after a couple of days and instead work with a district nurse who would administer the antibiotics twice daily at the patient’s home. Now, the patient is no longer exposed to other pathogens during an extended stay in hospital and instead is in a familiar and comfortable home setting with the reassurance that someone comes twice a day to check on her as she gets better. Beyond the duration of the antibiotics course, the district nurse would ensure a volunteer from an organisation like the Royal Voluntary Service would visit say twice weekly to make her life easier. 
These subtle reinforcements to the linkages between silos results in much better outcomes and also saves tax payers money by mitigating the cost of 30 hospital bed days and the care home – clearly representing better value. These sorts of examples are rife in the current system and are not that hard to grasp if front-line staff were supported, given the right freedoms, and incentivised in the right way.
One enabler for bringing about integrated care is outcomes (or value) based commissioning. This means that healthcare providers allow a portion of their reimbursement to be “at risk” – a part of their pay being based on the outcomes they achieve. Currently, the majority of services are paid for by activity or output, for example doing a knee operation three times on the same patient would pay out thrice. While I’m not suggesting that surgeons do not do a good job the first time, there is actually not much incentive to do so. 
Think instead if the provider is paid for outcomes – it incentivises an anaesthetist, surgeon, physiotherapist and occupational therapist all to work together to ensure the
patient gets healthier and back to work quicker i.e., resulting in better patient outcomes and ultimately happier front-line staff.
So how can provider organisations capitalise?
As the NHS and the wider public sector increasingly embrace outcomes, and more importantly contracting for them, there will be an opportunity for social enterprises and charities to provide services in this space. Outcomes will quickly move from being narrowly (and obviously) defined e.g., mortality, to encompass things like getting back to work, preservation of independence and self-care, capability to be the parent one wants to be, etc.  Beyond the initial clinical setting, the scope of services required to achieve these outcomes are areas in which social enterprises and charities are not only geared up to support but better able to perform than the public system. Consider Place2Be, the leading UK provider of school-based mental health support, which delivers one-to-one counselling work in the school setting at 45% lower cost than the equivalent service within the clinical setting.
So what’s the call to action - how can social enterprises and charities be best placed for these contracts? Here are 6 suggestions:
1. Truly understand the outcomes your users/beneficiaries are looking for – just “doing good” may not be enough. Take the time to ask what the outcomes they want are and adjust your offering if required.
2. Measure these outcomes – how can you know you’re helping unless you have the systems in place with the right metrics?
3. Clearly articulate why you are best placed to provide the services that will achieve these outcomes.
4. Know who the commissioner is. While this may be obvious in some cases, the changing public sector landscape means that these roles may be shifting to other organisations.
5. Promote yourself. The public sector is strained. Organisations who make it easy for commissioners by highlighting the support they can bring will be providing value to the public sector.
6. Prepare to put yourselves ‘at risk’ – I mean contractually. If people are contracting for outcomes, you have to understand that not delivering those outcomes means that you might not get paid.
Those organisations ready to take on these challenges will put themselves in the best position to not only survive, but thrive and grow. I wish you good luck!
Seigo is currently an Associate with On Purpose, which runs a one-year leadership programme that combines work placements with weekly training and regular one-to-one coaching and mentoring to develop high calibre talent to address the big issues faced by society and the environment. Applications for the October 2014 On Purpose Associate programme are open until 18th April. For more information visit