Contracting in Theory and in Practice: Some Evidence From the NHS

Bennett, Chris; Ferlie, Ewan

doi:10.1111/j.1467-9299.1996.tb00857.x

Cited by 77 publications

(49 citation statements)

References 16 publications

(5 reference statements)

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“…The power games played out by purchasers and providers during the early days of the reforms seem to have been replaced by an increasing recognition and acceptance of the need to work together in order to facilitate structural change and meet national and local policy objectives [6]. The rhetoric surrounding the development of purchasers in which Ministers urged them to move beyond stand-off relationships to 'mature relations with pro6iders' [58] has been reflected in practice-for example, Health Authorities have stated that they favour collaborative relationships and that trust plays a central role [59,60], although they also note a certain tension between aspirations and the reality as the role of trust is sometimes seen as 'precarious and 6olatile' [60].…”

Section: Rele6ance To the Nhsmentioning

confidence: 99%

From competition to co-operation: new economic relationships in the National Health Service

Goddard

Mannion

1998

Health Econ.

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The Labour government has outlined its plans to 'replace' the competitive internal market with a more collaborative system based on partnership. Agreement amongst purchasers and providers is to be based on co-operation rather than competition. Longer term agreements covering periods of 3-5 years are to replace annual contracts within this new environment. The aim of this paper is to explore the potential economic implications of these policy changes by drawing on the economics of co-operation and the transaction costs approach to longer term contracting. Issues surrounding the role of trust in contractual relationships are explored and the relevance of experience and evidence from non-health care sectors is considered in the context of the NHS. It is concluded that both theory and empirical evidence suggest that co-operation and trust can play a central role in the efficient organisation of contractual arrangements in circumstances similar to those under which the NHS operates. However, we warn against the expectation that the policy changes will produce automatically the scale of benefits predicted by the Labour government, especially as they will have to find a way of extracting reasonable performance from providers under a system of collaboration and long term agreements. They may find they need to tread a fine line between competition and co-operation in order to reap the benefits of both.

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Section: Rele6ance To the Nhsmentioning

confidence: 99%

From competition to co-operation: new economic relationships in the National Health Service

Goddard

Mannion

1998

Health Econ.

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“…Analysis of contracting using a neo-classical framework is often insufficient to accommodate a number of important phenomena [1,18]. In particular there is the paradox that although many of the 'new public management' reforms of the last decade have been inspired by a belief in the efficiency of market forces, neo-classical economic theory appears unable to offer much to the understanding of the contracts to which its application has given rise [19,20]. This is partly because contracts work by creating a set of incentives to which individuals or organizations respond, and neo-classical economics is ill-suited to explaining how this might differ from case to case.…”

Section: Economic and Socio-legal Approaches To The Study Of Contractsmentioning

confidence: 99%

Classical versus relational approaches to understanding controls on a contract with independent GPs in South Africa

Palmer

Mills

2003

Health Economics

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Contracts have played a central role in public sector reforms in developed countries over the last decade, and research increasingly highlights their varied nature. In low and middle income countries the use of contracts is encouraged but little attention has been paid to features of the setting that may influence their operation. A qualitative case study was used to examine different dimensions of a contract with private GPs in South Africa. Features of the contract are compared with the notions of classical and relational contracts. Formal aspects of the contract such as design, monitoring and resort to sanctions were found to offer little control over its outcome. The relational rather than classical model of contracting offered a more meaningful framework of analysis, with social and institutional factors found to play an important role. In particular, the individual nature of GP practices highlighted the role played by individual motivation where a contract exercised little formal control. Due to the similarity of factors likely to be present, results are argued to be relevant in many other LMIC settings, and policy-makers considering contracts for clinical services are advised to consider the possibility of experiencing a similar outcome.

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“…Relational contracts involve an ongoing relationship between the parties involved and are driven by the need to maintain the relationship. Since future events cannot be foreseen, the parties will need to revisit the agreement and jointly deal with problems Allen (2002), 139 Allen et al (2002), 140 Bennet and Ferlie (1996) 1 Ferlie (1992), 15 Ashton (1998), 156 Flynn et al (1995), 159 Goddard and Mannion (1998), 28 Palmer (2000), 6 Raftery et al 166 Palmer and Mills (2003), 125 Petsoulas et al (2011) 162 …”

Section: Relational Contractsmentioning

confidence: 99%

“…Increasingly, health-care contracting is viewed, not just as a technical task, but as a complex intervention influenced by a system of inter-related social networks, organisational forms, labour markets, political policies and institutions. 1 Theory is a way of simplifying complex reality. 16 Theories, therefore, are an important way to capture all the factors which may influence the processes and outcomes of health-care contracting.…”

Section: Literature On Health-care Contracting Theorymentioning

confidence: 99%

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Contracting with General Dental Services: a mixed-methods study on factors influencing responses to contracts in English general dental practice

Harris

Perkins

Holt

et al. 2015

Health Serv Deliv Res

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BackgroundIndependent contractor status of NHS general dental practitioners (GDPs) and general medical practitioners (GMPs) has meant that both groups have commercial as well as professional identities. Their relationship with the state is governed by a NHS contract, the terms of which have been the focus of much negotiation and struggle in recent years. Previous study of dental contracting has taken a classical economics perspective, viewing practitioners’ behaviour as a fully rational search for contract loopholes. We apply institutional theory to this context for the first time, where individuals’ behaviour is understood as being influenced by wider institutional forces such as growing consumer demands, commercial pressures and challenges to medical professionalism. Practitioners hold values and beliefs, and carry out routines and practices which are consistent with the field’s institutional logics. By identifying institutional logics in the dental practice organisational field, we expose where tensions exist, helping to explain why contracting appears as a continual cycle of reform and resistance.AimsTo identify the factors which facilitate and hinder the use of contractual processes to manage and strategically develop General Dental Services, using a comparison with medical practice to highlight factors which are particular to NHS dental practice.MethodsFollowing a systematic review of health-care contracting theory and interviews with stakeholders, we undertook case studies of 16 dental and six medical practices. Case study data collection involved interviews, observation and documentary evidence; 120 interviews were undertaken in all. We tested and refined our findings using a questionnaire to GDPs and further interviews with commissioners.ResultsWe found that, for all three sets of actors (GDPs, GMPs, commissioners), multiple logics exist. These were interacting and sometimes in competition. We found an emergent logic of population health managerialism in dental practice, which is less compatible than the other dental practice logics of ownership responsibility, professional clinical values and entrepreneurialism. This was in contrast to medical practice, where we found a more ready acceptance of external accountability and notions of the delivery of ‘cost-effective’ care. Our quantitative work enabled us to refine and test our conceptualisations of dental practice logics. We identified that population health managerialism comprised both a logic of managerialism and a public goods logic, and that practitioners might be resistant to one and not the other. We also linked individual practitioners’ behaviour to wider institutional forces by showing that logics were predictive of responses to NHS dental contracts at the dental chair-side (the micro level), as well as predictive of approaches to wider contractual relationships with commissioners (the macro level).ConclusionsResponses to contracts can be shaped by environmental forces and not just determined at the level of the individual. In NHS medical practice, goals are more closely aligned with commissioning goals than in general dental practice. The optimal contractual agreement between GDPs and commissioners, therefore, will be one which aims at the ‘satisfactory’ rather than the ‘ideal’; and a ‘successful’ NHS dental contract is likely to be one where neither party promotes its self-interest above the other. Future work on opportunism in health care should widen its focus beyond the self-interest of providers and look at the contribution of contextual factors such as the relationship between the government and professional bodies, the role of the media, and providers’ social and professional networks.FundingThe National Institute for Health Research Health Services and Delivery Research programme.

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Contracting in Theory and in Practice: Some Evidence From the NHS

Cited by 77 publications

References 16 publications

From competition to co-operation: new economic relationships in the National Health Service

From competition to co-operation: new economic relationships in the National Health Service

Classical versus relational approaches to understanding controls on a contract with independent GPs in South Africa

Contracting with General Dental Services: a mixed-methods study on factors influencing responses to contracts in English general dental practice

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