Belfast Trust spent £600,000 on management consultants in two years

09 August 2018

The leadership of a Northern Irish health trust has come under fire for doling out more than £600,000 for advice from management consultants in just two years. According to official figures, the Belfast Health Trust paid £7,100 to a private management consultant for 15 days of support in relation to a damning hyponatraemia report, which examined the deaths of five children, finding that four of the deaths were avoidable.

The consulting bills of public health providers across the world have come under mounting scrutiny in recent years, as, irrespective of allegedly rigorous tender processes and assurances that such external expertise will help the keystone state service line do more with less, the public and most opposition groups remain largely unconvinced. This came to the fore recently in the UK, when analysis of 120 NHS trusts found that the more they spent on management consultants, the less efficient they became. For the notoriously under-funded institution, this was particularly shocking, with researchers finding that for every £100,000 spent enacting the advice of consultants, there was a correlation with an extra £900 in costs, amounting to average losses of around £10,600 per trust.

Meanwhile, in Australia, public ire was provoked following the leaking of financial records pertaining to the National Disability Insurance Scheme (NDIS), showing that executives in charge of running the government agency behind the scheme spent more than AU$180 million on consultants and contractors between July 2016 and October 2017. Of that figure, as much as AU$41.5 million was spent on just two major consulting industry players for “strategic advice”, while the service failed to meet the most basic needs of the vulnerable citizens dependent upon it.

Belfast Trust spent £600,000 on management consultants in two years

Now, Northern Ireland has become the latest nation to witness calls for the reigning in of consulting spending in public health provision. As the health service across Northern Ireland faces unprecedented financial pressures, with the Healthcare Financial Management Association (HFMA) releasing a report in January warning that Northern Ireland's health service could have a funding gap of up to £540 million a year, the Belfast Trust has been criticised for its spending of more than £600,000 on management consulting services, in the space of only two years. On top of this, the group has also tasked another private management consultant to help with work around the on-going recall of more than 3,000 neurology patients in the Belfast Trust, in a role which is expected to take 30 days to complete, at a cost of £15,000.

Health trusts across Northern Ireland are becoming increasingly reliant on cash injections from in-year monitoring rounds and the DUP-Conservative confidence and supply deal just to make ends meet. Despite the apocalyptic proportions of the crisis faced by health providers in the country, however, figures released by the Business Services Organisation reveal that even as thousands of patients spend up to five years waiting in acute pain for operations on debilitating conditions, the HSC Leadership Centre (HSCLC) is paying private consultants £500 a day for their services while providing consultancy services to the Belfast Trust at a cost of £630,701 between 2016 and 2018.

The HSCLC, which comes under the BSO, provides a range of services to health and social care organisations in Northern Ireland, including consultancy services, leadership development programmes, support for improvement, team development and other support, including investigations. The HSCLC currently has a pool of about 90 private consultants, known as associate consultants, who are drawn upon as and when required.

Alliance Member of the Legislative Assembly Paula Bradshaw expressed concern at learning the private consultants had been engaged at such a cost to the public purse. Bradshaw added, "In my opinion, the role of the health service is to support patients and their carers at times when health needs arise; and the funding that is allocated to the Department of Health for the provision of care and treatment to meet these needs is finite and in fierce demand right across the sector, and so I will be following this up to find out why the consultants were engaged.”

"Having supported a number of individuals and families affected by the neurology recall process and the Hyponatraemia Inquiry, I am particularly curious to learn more about the nature of this commissioned work and sincerely hope that it is not for the purpose of crisis management,” Bradshaw added.

A spokeswoman for the Belfast Trust contrasted this with the assertion it has used the resources of the HSCLC for two specific pieces of work "through normal business arrangements."

She added, "Firstly, to provide additional support to the trust in the implementation of the 96 recommendations of the findings of the inquiry into hyponatraemia-related deaths which was published on January 31 this year and which are actively being addressed within the trust and as part of the departmental framework. Secondly, in preparation for the independent inquiry panel as a result of the recall of neurology patients, we have secured additional assistance to support us in providing the inquiry with all relevant, extensive, and detailed documentation in a timely way."

Related: NHS selects 107 consultancies for Management Consultancy Framework.

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Medicine economic model creates negative health outcomes

26 March 2019

Profit-driven production of antibiotics has held back the development of vital medical breakthroughs, according to a new report. Analysis from a leading strategy consultancy suggests that a change in economic model and new incentives could prompt pharmaceutical giants to develop cures to major diseases, which could be affordable at scale.

The much maligned pharmaceutical industry has long been criticised for its failure to focus on deep seated issues in public health. For instance, there is increasing concern around microbial resistance, with some bacteria now resistant to all known antibiotics. Combating that requires new antibiotics – but drug companies see little profit in the field, and therefore have not seriously invested in it. Another instance of concern is a focus on treating symptoms rather than curing the diseases themselves, with such treatments requiring long-term payment to mitigate symptoms, rather than one-time cures being delivered.

Cases like the so-called “Pharma Bro” Martin Shkreli – who received widespread criticism when his company obtained the manufacturing license for the antiparasitic drug Daraprim and raised its price by a factor of 56 (from US$13.5 to $750 per pill – underline the failing of this system to meet the needs of society. New analysis from Boston Consulting Group (BCG) seeks to challenge the current economic model and its inherent failures in favour of a model that creates greater social good while also generating steady reliable returns for pharma companies. The analysis appears in the firm’s ‘Aligning Economic Incentives to Eradicate Diseases’ report.

Different pricing model makes cures more accessible

One example is Hepatitis C. The disease is massively damaging to human life, with considerable negative impacts on patients and society. Treatments have existed for decades, which manage the virus but did not cure it. These treatments had significant side effects however, which saw people not complete rounds – which then resulted in expensive emergency care and secondary health costs.

In 2013 a treatment was developed that effectively cured the virus in 8-12 weeks. The treatment has few side effects and works in most patients. However, five years later fewer than 10% of people globally with the virus have had the cure – largely because of prohibitive costs. The ambition to remove this disease and its large negative drag on the lives of millions by 2030 is becoming increasingly unlikely. The issue is cost.

The current economic model used by pharmaceutical companies mean that early adopters pay sky high prices as the company seeks to recoup costs, with the price eventually coming down to levels at which a larger segment can afford to access the drug – before its generic releases sees mass uptake. This model creates considerable initial barriers, and long-term social costs.

The report subsequently proposes a different pricing model that would see the price of a new drug kept at a constant level for its lifetime but have that level set considerably lower than the current model - which is focused on recouping costs immediately. Under the firm’s model, within 12 years of the Hepatitis C drug’s discovery, up to 96% of the population could be cured, at a cost 30% lower than the UN model and with a cure rate almost 50 percentage points higher than the base model.

The PLA scenario has better social outcomes than the traditional model

A change in model would, according to the firm’s analysis for HCP, triple the number of patients cured within 2 years, reduce the number of liver disease deaths by 60%, reduce total costs to payers by 30% (due to fewer additional costs on healthcare systems), while creating higher and more predictable revenue streams for pharma companies.

“There are many barriers to curing this population, but the dilemma created by current pricing models is one of the biggest,” said Dave Matthews, a BCG Principal and study co-author. The firm adds, “The dilemma results because a high price per patient makes treating everyone prohibitively expensive while an affordable price is too low for pharmaceutical companies to earn back their investments.”

Matthews concluded, “Switching to a population-based model such as the PLA not only makes the cure affordable, but also creates strong motivation to identify, diagnose, and treat as many patients as possible before the license expires.”

Related: Ten year deal activity in pharmaceuticals industry stands at $2.4 trillion.