Promoting Better Value in Care Provision through Alliancing: Prospects for Australia

On 4 November 2018, the Centre was lucky enough to welcome back Dr Nick Goodwin, CEO of the International Foundation for Integrated Care. Presenting at Transformers III in Byron Bay and Coffs Harbour we got to spend five days with Dr Goodwin, discussing all things alliance contracts.

Here he reflects on his time in the North Coast…


“The overall experience from the workshops in Byron Bay and Coffs Harbour suggests that there is ample motivation for doing things differently to improve public health outcomes across local communities of the North Coast.”


Care systems around the world are characterised by fragmentation in the way care is funded, organised, managed and delivered. Increasingly, such divisions are leading to poorer quality of care and outcomes to individuals and communities, especially to the most vulnerable whose needs transcend the boundaries and silos that care systems have created for themselves:

  • people with complex co-morbidities;
  • older people living with frailty;
  • people living with moderate to severe mental health conditions;
  • children and adolescents with special educational needs.

People’s care experiences are too often and inexcusably poor, their personal care outcomes not as good as they could be; and their utilisation of avoidable institutional care often very high yet preventable. In short, most care systems today are becoming increasingly economically unsustainable, yet they all have a significant opportunity to provide better value for money through new ways of working.

Alliancing is one of those approaches that has been taken forward in many countries to overcome the inherited vagaries of our fragmented care systems. In an alliance contract, a set of providers enters into a single arrangement with a commissioner (funder) to deliver services. They are legally bound together (i.e. share the risk) for achieving outcomes. Incentives are set based on system goals and outcomes. The system requires high-trust and is mutually governed through a shared board of directors and implemented through joint service delivery teams.

Download Transformers III presentations here 

Alliancing, in which the partners in care share risks and rewards equally, are most suited in situations where there is a high need to drive innovation and change towards more person-centred and integrated solutions to care. They are more consultative and seek to increase quality of service provision and outcomes through increasing value in care by optimising opportunities and promoting flexibility.

Alliances, therefore, are suited to the challenge of developing service innovations that better meet people’s complex needs but where the approach to care is not standardised but needs to be co-produced and adapted over time.

Dr Nick Goodwin, CEO, International Foundation for Integrated Care enjoying a light moment with Dr Viktoria Stein and Dr Apostolos Tsiachristas.

In health and social care, the positive benefits of alliances (when delivered well) include:

  • Enhanced care quality and patient experience;
  • Reduced admission rates to hospital and care homes;
  • Reduced unnecessary treatments;
  • Improved health outcomes;
  • Sustained cost reductions;
  • Greatest savings when focused on vulnerable populations, especially to the elderly and those with multiple chronic conditions (McClennan et al, 2014)

Key challenges, however, are not just the technical ones related to the development of new financial models and contracting or new organisational forms. Primarily, success can only be achieved through the development of trust between partners in care, and ability to collaborate (even if the environment promotes competition), and to have fully engaged staff and effective leadership.

Success in alliancing, therefore, does not happen by chance. Active leadership and management are required to nurture relationships and build alliances over time.

During my presentation at the Transformers 3 event in Australia, several international case examples were presented including:

  • The Stockport Targeted Prevention Alliance in the UK that has demonstrated improvements in people’s mental and emotional health outcomes whilst making more efficient use of financial resources;
  • Counties Manukau Health in New Zealand where alliancing in local communities has improved care coordination and outcomes for people, as well as reducing acute admissions and bed days in hospitals;
  • Coordinated Care Organizations in Oregon, USA, where a focus on building community health has seen significant increases in the enrolment of patients in medical homes and subsequent reductions in hospitalisations for people with chronic conditions; and
  • The Millom Alliance, UK, that has grown from small beginnings to become the template for 20 community-based alliances across Cumbria demonstrating improved population health outcomes at reduced costs for over 750,000 people

These inspiring examples have a common ingredient – activated communities – who have been mobilised at scale to become an integral part of the local leadership and care delivery teams. Such an assets-based approach appears to be essential in embedding alliances for the longer-term within the communities that they serve. Hence, whilst the focus on alliancing is often on the financial mechanisms, its building blocks lie in bringing together of alliance partners in local communities with the collective motivation to work together to tackle issues of common concern.

Dr Apostolos Tsiachristas offering a solution to fragmented funding streams.

The Australian system is unusual internationally in the degree of fragmentation across its funding streams. Unless ways can be found to bring these funding streams together (an example being local commissioning entities where state and federal budgets might be pooled for the purpose of planning and purchasing across place-based alliances) then innovation will rely on the hard work and motivation of local actors to ‘work around’ existing fragmentations. However, it is truism to say that “where’s there a will there’s a way” when it comes to integrated care and this was demonstrated during Transformers 3 through several leading examples of alliancing in NSW that were delivering better care and outcomes to people.

For example:

  • The Wollondilly Health Alliance (driven since 2014 by three partnership organisations of Wollondilly Shire Council and South West Sydney LHD and PHN) has developed innovative ways to connect and support local health services to improve population health across the Wollondilly community. This has included a wide range of health promotional activities to promote wellbeing, innovative home-based tele-monitoring and video consults, and the Dilly Wanderer – a free mobile community information and development service.
  • In Hunter New England, the alliance approach has led to an innovative and integrated model of diabetes care using co-commissioning. Through the shared governance offered by an alliance model, co-commissioning provided a unique opportunity for primary care and secondary care funders to jointly commission diabetes services to deliver integrated services delivering improved patients outcomes.

The overall experience from the workshops in Byron Bay and Coffs Harbour suggests that there is ample motivation for doing things differently to improve public health outcomes across local communities of the North Coast.

Whilst PHNs and LHDs might be the leaders of those discussions, it is important that they take on the role of strategic commissioners in close partnership with local providers, councils, NGOs, community groups and others. This will eventually require shifting funding mechanisms that help to pool resources and so then lean towards partial capitation models with contracts that focus on outcomes and innovation. Existing limitations in procurement rules and practices, however, need to be addressed for this to happen.

Perhaps the key take-away message from Transformers 3 is that the first conversation should not be about money at all. All delegates recognised there was significant opportunity to do things differently on the North Coast within the boundaries of their existing institutions and financial resources.

The first step, then, to an alliance formation was not seen as contractual but the coming together of local partners to create a shared ambition and common purpose with a subsequent commitment to work differently and to find the resources necessary to make a difference. Crucially, a place-based approach is required to embed initiatives within local communities and so give some stability towards longer-term objectives that might otherwise wax and wane in the face of short-term political and funding cycles.

Given the ambition of NSW Health to promote better value in care then there needs to be recognition that the solution will not be adequately addressed from inside the existing boundaries of healthcare provision. Forms of cross-sectoral networks and alliances, working with local communities in co-productive partnerships, seem to offer a better bet. Whilst the process of nurturing and developing new alliances is no panacea, and rarely a coalition of the willing, it is only through such new innovations that the long-term challenges in health and care systems are likely to be addressed.


Dr Nick Goodwin will be back on the North Coast and extending on the alliance theme with the International Summer School on Integrated Care. This 5-day residential retreat will be held in Kingscliff from Sunday 7 – Friday 12 April 2019 and will drive forward integrated care projects through presentations, group discussions, a site visit and assigned tasks. Call Bronwyn Thirkell on 02 6618 5445 for details.

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