Healthcare costing standards for England
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1 Healthcare costing standards for England Education and training costs Transitional method Acute
2 We support providers to give patients safe, high quality, compassionate care within local health systems that are financially sustainable.
3 Contents Introduction... 2 E&T1: Transitional method for netting off E&T income from PLICS and reference costs > Contents
4 Introduction We are not collecting education and training (E&T) costs this year. However, it remains important for providers to understand the costs of E&T and we will publish E&T costing standards in March 2018 for use in a pilot collection. This document outlines the 2017/18 transitional method for netting off E&T income from patient-level costs (PLICS) and reference costs. This method was developed with the Department of Health and Social Care s Education and Training working group. It is part of the Healthcare costing standards for England. All standards are published on NHS Improvement s website. 1 1 See 2 > Introduction
5 E&T: Transitional method for netting off E&T income from PLICS and reference costs Purpose: To enable a consistent approach to netting off education and training (E&T) income in both reference costs and the PLICS costing process during the transition phase of the national cost collection. 2 Scope 1. This guidance specifies the transitional method of netting off E&T income from acute PLICS and reference costs. This method supports the transition from the national reference costs to the acute PLICS collection. In 2018, E&T income will be netted off both collections using the method prescribed in this guidance. 2. This guidance only applies to the acute early implementers. If you are not an acute early implementer or you are a provider of mental health, community or ambulance services, you are not required to implement this guidance. 2 Information about the 2018 national cost collection is available at 3 > E&T: Transitional method for netting off E&T income from PLICS and reference costs
6 Overview 3. The guidance describes a five-step method to allocate and net off E&T income at cost centre/subjective code level, based on the four E&T income categories: tariff postgraduate medical tariff undergraduate medical tariff non-medical non-national tariff. 4. You do not need to calculate E&T costs to be able to apply this transitional method. However, when the guidance states you should use E&T costs as a weighting, use your 2016/17 E&T costs but adjust these for the number of students and trainees in 2017/18. For example, if the number falls between 2016/17 and 2017/18, adjust your E&T costs down by the same proportion. Approach What you need to implement the guidance 2016/17 E&T costs at cost centre/subjective code level 2017/18 E&T activity information sources 2017/18 E&T income. 5. The five-step approach to allocate and net off E&T income at cost centre/subjective code level, based on the four income categories listed above, is described below and summarised in Figure ET E&T income is netted off at cost centre/subjective code level because E&T costs are not incurred treating patients, although both activities share the same resources. Therefore E&T income should not be allocated and netted off at either healthcare resource group (HRG) (for the reference costs collection) or patient level (for the PLICS collection). Netting off needs to happen earlier in the process that is, at cost centre/subjective code stage. 4 > E&T: Transitional method for netting off E&T income from PLICS and reference costs
7 Figure ET1.1: Transitional method to net off E&T income Transitional method to net off Education and Training income E&T Income (input) Non-medical Undergraduate medical E&T income Post graduate medical Other (non-tariff) Net off E&T Costing process income from Allocate to cost centres Information required subjective codes Non-medical placements by specialty/ department Cost centre by department/location Separate schedules for each programe Placements by specialty and year Cost centre based on location Curriculum placement by year Trainees by specialty and grade Cost centre based on specialty/department Net off E&T income from subjective codes using 2016/17 costs as weighting Going through the rest of the costing process LDA Information from the departments Questionnaires about rota or work plan Roles (e.g. Heads of school) Cost centre based on roles List of named people who have a role in delivering E&T 2016/17 E&T costs data Step 1: Allocate and net off postgraduate medical income 7. You need to obtain the following information for this step: activity and cost information: number of whole time equivalents (WTE) 3 for postgraduate medical trainees by: 1. specialty (department) 2. grade 4 3 This information is available from the Learning and Development Agreement (LDA) via your local Health Education England (HEE) team. 5 > E&T: Transitional method for netting off E&T income from PLICS and reference costs
8 2016/17 E&T cost information at cost centre/subjective code level deanery post schedules finance schedules income information: 2017/18 postgraduate medical E&T tariff income 2017/18 tariff basic salary contribution for postgraduate medical trainees. 8. To allocate and net off the income you need to: allocate E&T income for postgraduate medical trainees to specialties (departments) weighted by the number of WTE for postgraduate medical trainees allocate the income by specialty to cost centres allocate the income by cost centre to subjective codes using the 2016/17 E&T costs on the subjective codes as a weight net off the income from the cost centre/subjective codes allocate basic salary contribution income by grade of trainee to specialties (departments) weighted by the number of WTEs net off the income from the subjective codes for postgraduate medical trainees salaries. 9. This will produce medical E&T tariff income netted off at cost centre/subjective code level. Step 2: Allocate and net off undergraduate medical income 10. You need to obtain the following information for this step: activity and cost information: length of undergraduate medical student placement in weeks 5 by curriculum placement year and specialty 6 location of the placement 3 4 Postgraduate medical trainees can move grade within a financial year (usually to the next grade in August). Your local HEE team will have adjusted for this in its calculation of contribution to basic salaries. This information is available from your local HEE team. 5 This information is available from the LDA or directly from your hospital departments. 6 This information is available from medical schools and should have already been used earlier in the costing process. 6 > E&T: Transitional method for netting off E&T income from PLICS and reference costs
9 2016/17 E&T cost information at cost centre/subjective code level income information: E&T income for undergraduate medical students. 11. To allocate and net off the income you need to: allocate E&T income for tariff category: undergraduate medical to specialties (departments) by length of placement in weeks allocate the income to cost centres based on specialty or placement location allocate the income by cost centre to subjective codes weighted by 2016/17 E&T costs net off the income from the cost centre/subjective codes. 12. This will produce undergraduate medical E&T tariff income netted off at cost centre/subjective code level. Step 3: Allocate and net off non-medical income 13. You need to obtain the following information for this step: activity and cost information: separate schedules for each programme /17 E&T cost information at cost centre/subjective code level income information: E&T income for non-medical trainees by schedule for each programme. 14. To allocate and net off the income you need to: allocate E&T income for tariff category: non-medical to specialties (departments), location or clinical pathway based on the programme schedules allocate E&T income by specialty or location to cost centres allocate the income by cost centre to subjective codes weighted by 2016/17 E&T costs net off the income from the cost centre/subjective codes. 15. This will produce non-medical tariff E&T income netted off at cost centre/subjective code level. 7 > E&T: Transitional method for netting off E&T income from PLICS and reference costs
10 Step 4: Allocate and net off non-tariff income 16. You need to obtain the following information for this step: activity and cost information: separate schedules for each programme 2 list of named people and their specific E&T roles 2016/17 E&T cost information at cost centre/subjective code level income information: non-tariff E&T income for undergraduate medical students, postgraduate medical trainees and other regional programmes. 17. To allocate and net off the income you need to: allocate non-tariff E&T income to roles (eg heads of school) based on the schedules for each programme allocate non-tariff postgraduate and undergraduate medical income by following the approaches specified in steps 1 and 2 respectively allocate E&T income for each role to cost centres and net off from the subjective codes for the salaries. 18. This will produce non-tariff E&T income netted off at cost centre/subjective code level. Step 5: Netted off costs to go through the costing process 19. Put the output from the four steps above that is, all the E&T income netted off at cost centre/subjective code level through the costing process prescribed by: the Healthcare costing standards for England acute (final version) 7 the national cost collection guidance for reference costs submission See The national cost collection guidance > E&T: Transitional method for netting off E&T income from PLICS and reference costs
11 Contact us: NHS Improvement Wellington House Waterloo Road London SE1 8UG This publication can be made available in a number of other formats on request. NHS Improvement 2018 Publication code: CG 32/18
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