The “never event” contractual framework

As the Government made clear in Equity and Excellence: Liberating the NHS, the NHS needs a comprehensive, transparent and sustainable structure of payment for performance that ensures payment reflects quality. Payments and the ‘currencies’ they are based on will be structured in the way that is most relevant to the service being provided, and will be conditional on achieving quality goals. If providers deliver care that is of poor quality, then commissioners will be able to impose contractual penalties.

In this context, the “never event” framework is clear that where a “never event” occurs during a commissioned episode of care, the commissioner should recover the cost of that episode of care and, in addition, there should be no charge to the commissioner for any corrective procedure/operation that is required. Where there is in-hospital death, the commissioner can recover the cost of the episode of care if appropriate, or the cost of the care to date within the financial year for the ongoing patient episode.

Cost recovery is intended as a lever to encourage providers to ensure that “never events” do not happen. Recovery of money is not in any way intended for use as ‘compensation’ for a “never event” occurring. Recovery of costs does not in any way affect the provider’s liability with respect to criminal or clinical negligence proceedings.

Commissioners will be able to waive the cost recovery process according to individual circumstances and local agreement. This should be the result of an open dialogue between the commissioner and the provider, where the circumstances of the particular event are taken into account, including the actions that the provider has taken in response to the event.

Importantly, cost recovery does not replace any separate regulatory requirements such as the process of registration with the Care Quality Commission (CQC) and compliance with minimum standards. The payment system should align with and support best practice but is not, nor should become, a regulatory mechanism. The CQC should use information on “never events” to inform its regulatory processes and, following a “never event”, should take any enforcement action it deems appropriate. This action could include imposing additional financial penalties such as fines, where a review of compliance following a “never event” provides evidence of non-compliance with Essential Standards of Quality and Safety. Any such review should of course take into account the local response to the ‘never event’, such as cost recovery, and any evidence of learning.

Most importantly though, and consistent with the current arrangements, there must be a robust and rapid process of reporting, learning and improvement following a “never event”. Each “never event” should be reported to the relevant Primary Care Trust/commissioner and to the National Reporting and Learning System at the National Patient Safety Agency (NPSA).  Each “never event” should be the subject of an investigation of its root causes, learning should implemented and the systems for future prevention strengthened. Commissioners should give high priority to the learning gained from investigation and the actions put in place by providers after a “never event”. The reporting and review of events between commissioners and providers should include evidence of discussion with the affected patient and/ or carers consistent with the NPSA’s Being Open framework .

In future years, these principles will still apply, but in the context of a restructured NHS. This means that providers will be required to report the incidence of ‘’never events’’ to the commissioner of the care in which the event took place (either the National Commissioning Board or the relevant GP Commissioning Consortium). The incident must also be reported to the National Reporting and Learning System, which will sit with the National Commissioning Board.

Do you agree with cost recovery for all providers, given that some incidents relate to short term, low cost interventions and others relate to long-term care where cost recovery could be many thousands of pounds? This could disproportionately affect small providers.

Do you have alternative suggestions for the contractual framework?

In 4. Contractual framework

9 Responses to The “never event” contractual framework

  1. Caroline Miriam Batchelor says:

    To implement contractual audits ( already carried out in Sussex for other contractual activities and performance within the schedules)
    Expand the list further ( posted comments seperate post)
    Cost individual failures:
    Extrapolate out:
    Finacially, penalise the providers.
    Re audit:

  2. pete sudbury says:

    a system of penalties based at random on the cost of the episode is a lottery, where the penalty is unrelated to the extent of the harm caused to the patient or to others. a death caused in A&E might attract no penalty at all, where an escape from a medium secure unit, lasting a few hours and resulting in no harm or risk of harm, might incur a cost of tens of thousands of pounds. Killing a healthy young adult at the start of an episode of care will result in smaller losses than the death of an extremely sick person with a long term condition. Far better to create an explicit tariff related to the degree of harm (based perhaps on QUALY reduction), or set aside a proportion of the CQUIN (e.g. 20%) that is progressively removed if never events occur).

  3. Jeff McILwain says:

    A personal view:

    1. Until the current list shows an evidenced reduction in harm / death then there is no evidence that such an approach works, therefore, expanding a list may lead to a greater burden with no effect. In other words itemising contracted work does nothing to improve a safety culture. There must be no further additions until clear training programmes are established from within Royal Colleges and Deaneries concerning the culture of patient safety. One can only be punitive after such training has been ignored or failed – not before. There is a standard mantra in corporate worlds – Contract then Consolidate then Expand. The proposals are putting expansion before consolidation in other words punishment before training of all NHS staff.

    2. Further, there is clear, yet anecdotal, evidence that there is pressure within the secondary care system that the achievement of targets may create system failures and so error and harm. There is nothing within this document to ascertain that organisations that must provide and ensure that all patient safety matters supersede financial and political targets. So a “Never Event” must include organisational dysfunction that places individual clinicians in a system that allows never events to occur such as low staffing. Mid Staffordshire Trust is a case in point.

    3. Finally there is the matter of primary care settings. Drug errors and poor diagnoses and treatment may be rife – who is to know? Many secondary care setting events are imported from the community such as grade 1 or 2 pressure sores. The primary care setting has a duty of care to ensure that preventable events do not become “Never Events” through appropriate surveillance and monitoring. The focus upon the secondary care setting alone distorts the premise that harm or death is exclusive to the secondary care setting. The matter of Harold Shipman suggests otherwise on a pro rate basis of death per doctor. Whilst it is acknowledged that Harold Shipman was a murder who happened to be a doctor nevertheless primary care setting deaths that are preventable or avoidable must take equal precedence to that in secondary care settings. Such equality should begin before any expansion in the secondary care setting lists. Further, should such a wise decision be made to include eight primary care setting “Never Events” the use of financial punishment against the Commissioners within primary care will suggest that such a punitive approach will do nothing to entice clinical staff to a better cultural of safety but rather view that the monies so fined will just come off a broad back.

    A shepherd has two ways to move a flock of sheep. Either, the shepherd can lead by example from the front and so the flock follows [encouragement and leadership], or, the shepherd can threaten from the rear of the flock with a dog and harsh gestures [punitive] – which do you think works best? Further, and finally, the role of the Royal Colleges including the Medical Royal Colleges and those of Nursing and Midwifery must see their role and duty. As far as I am aware there is no specified patient safety training course as part of any training curriculum – surely that is the target audience for quality and safe care – not the financial coffers of a commissioning body? Given that 10% of anything that can go wrong will go wrong why is there not 10% allocation of resources towards patient safety matters at all levels?

    In conclusion leadership through Royal Colleges of the current “Never Events” is wisest and must include the organisations within the NHS as to their culture as well as primary care settings as to avoidance and exporting harm. So, there should be no expansion of any list until cultural approaches are embedded and certainly there should be no financial penalties until such a universal culture exists. Thereafter one can expand and cajole and punish to one’s heart’s content.

  4. Richard Nelson says:

    The application of financial penalties to “Never Events” will have exactly the opposite of what is desired. It will result in major procedure changes in practice to avoid “Never Events” but fail to address the issue of other events not so coded. It will also result in a pressure to under report “Never” events and the more honest Trusts with excellent governance structures will be penalised. Beware the law of unintended consequences and reflect on the numbers of patients who found themselves on the wrong ward at the wrong time 3hours and 59 minutes after coming into the ED.

  5. Richard Wenstone says:

    I have serious concerns that finacial penalties will actively encourage Trusts to ignore, hide or underreport such events. Any process should be designed, from the outset, to actively encourage reporting.
    It would make more sense to require near-misses of never-events to be reported as well, rather than employing a strategy likely to suppress information.

  6. Catherine Davies says:

    Mental Health has not as yet moved to PbR, therefore attaching reference costs to penalties attached to never events can be extremely complicated and arbitrary. Until MH PbR comes on line it would be helpful if penalties and sanctions were fixed, e.g. 0.1% of the total monthly contract value per incident up to a maximum of 10% of the total monthly contract value.

  7. Lindsey Webb says:

    We do have concerns that this could disproportionately affect small providers as there may be instances where we would have to transfer the ongoing care of patients out to alternative providers and, as such, would incur full tariff costs compared with those bigger organizations that would be able to care for those patients within their own organization.

    In addition, we do also have some concerns about the risk of increased NHSLA premiums as a result of the addition of further never events.

  8. University Hospitals Birmingham NHS FT says:

    In agreement with the comments above it is counter-intuitive to encourage reporting which will lead to learning in a punitive environment.

  9. Jonathan Howell says:

    West Midlands Specialised Commissioning Team – There is a feeling that financial penalties could be insufficient or possibly disproportionate if the size of the provider trust is small or large. One team member who oversees CQUINs commented that the use of cost recovery increases provider focus on avoiding never events. There are concerns that it would also encourage a resistance to report in some cases (but this is always a possibility – my comment); also the practicalities around recovering monies may be themselves be resource-intensive making commissioners reluctant to follow the process through.

    Have you consided an alternative approach? Such as a CQUIN type incentive scheme whereby you take a percentage of the contract value and offer this as a quarterly quality payment if certain targets are met, e.g. demonstration of processes to avert “never events” and not sustaining a “never event”.