Review of incentives, rewards and sanctions: discussion paper for stakeholders

Document type
Discussion paper
Corporate author(s)
NHS England. Commissioning Development Directorate
Publisher
NHS
Date of publication
2 July 2013
Subject(s)
Health Services, Employment
Collection
Social welfare
Material type
Reports

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Incentives, rewards, and sanctions are often not used as intended. Examples of this include: commissioners setting targets that cannot be achieved in order to avoid paying Commissioning for Quality and Innovation (CQUIN) monies, individual sanctions not being implemented in the event of performance failures, the impact of all incentives and sanctions being guaranteed through commissioners, and providers agreeing block (or cap and collar) arrangements. 

A number of reasons have been cited for this: the level of complexity is too great, there is insufficient contract management capacity and capability, Payment by Results (PbR) is too volatile, and targets are too difficult or time-consuming to negotiate. 

The evidence base on the effectiveness of rewards and sanctions makes it difficult to draw conclusions on the true impact that national incentives, rewards, and sanctions have had to date and, going forward, what the level of risk and reward should be, how to determine the correct balance of national and local incentives, rewards, and sanctions, and what the impact of addition or removal of incentives can be. 

Therefore in this document NHS England asks to hear views from stakeholders on possible changes to the regime of incentives, rewards, and sanctions to help design the right package of incentives for 2014/15 and inform the future strategy.

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