Payment by results – Gangnam style

Thinking that 300 million people worldwide can’t be wrong, I decided I had to watch the Gangnam style video which has spread the fashion for Korean pop music all over the planet.

Watching the video got me thinking about how fashionable payment by results has become at the moment.

PbR is cool

There is plenty of evidence to say that payment by results is the height of fashion:

  • The popularity of PbR within government appears undimmed.
    • Earlier this month we saw PbR applied to a new policy area – the removal of illegal immigrants.
    • The move of Chris Grayling to be Justice Minister is rumoured to result in even faster development of PbR across the criminal justice system – (Grayling was heavily involved in the development of the PbR-commissioned work programme.)
  • The next couple of months sees a whole host of conferences, seminars and events dedicated to payment by results. The ones I’ve attended recently have all been sold out.
  • NCVO has just launched a PbR working group for the voluntary sector.

On top of this, there are lots of commissioners, in social care and substance misuse in particular, who are keen to find out what PbR is all about and whether it will work locally.

However, not everyone is a dedicated follower of fashion and it is still possible to find plenty of people who are not so convinced that PbR is the way to go.

PbR is doomed

This view is promulgated by a wide range of commissioners, providers and affected others, in the substance misuse world in particular, who are convinced that PbR won’t work and is a flash in the pan.

They despair of the intricacies of many of the tools being developed to profile caseloads, develop clusters, set tariff payments etc. (Interestingly, the Department of Health shorthand for their profiling of drug users in treatment is “the complexity tool.”)

The main line of argument of these fashion-resisters is that PbR in practice seems to have moved a long way from the initial idea of setting clear outcomes and developing simple ways of measuring them.

Many in this camp say that the massive changes in the commissioning of health services combined with substance misuse being moved to Public Health will result in inevitable delays and the very slow implementation of PbR.

A speaker at the Alcohol Concern PbR Conference last week stated that PbR for Mental Health was established in the NHS in 2005 and they haven’t even started to develop outcome measures yet.

The third way

However, there is a middle position.

I’ve had a lot of conversations recently with people involved in a range of PbR pilots.

Although many of them remain very positive about the principles of payment by results, several are saying that PbR may not be the only way to incentivise new ways of working.

For this group, one of the main advantages of PbR has been that it has changed the dialogue between commissioners and providers.

PbR is seen as a great way to focusing provision on outcomes or of driving through the implementation of the NICE guidance on tackling problem drinking – even if the eventual solutions don’t necessarily include a PbR approach.

Looking ahead

One of the reasons that it’s hard to assess whether payment by results is merely the latest fad or a fundamental revolution in the way we commission public services is that PbR is such a new approach.

We have very little international evidence and none of the main pilots are due to report results for another couple of years at least.

In the meantime, perhaps PbR is doing its job by getting us all to explore different ways of tackling entrenched social problems.

While the jury is out, it might be time to practise your horse-dance:


For a series of different perspectives on payment by results, check out my video interview series which runs every Monday.

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