The tariff and payment systems
The national tariff is the set of rules that defines how NHS activity in providers is reimbursed in England. NHS England is responsible for setting what is in scope for the tariff, and Monitor sets the prices for activity. At the moment, there are two principal contracting arrangements commissioners use to fund NHS foundation trusts and trusts, which come under the national tariff rules:
1. A standardised list in the tariff of prices paid for the majority of acute NHS treatments, interventions and operations, which is part of the payment system known as payment by results (PBR).
2. Block contracts: Here commissioners agree with providers a fixed budget for a certain period of time. This is the method for the vast majority of non-acute providers (ambulance, community and mental health) but there have been moves in recent years toward new payment approaches.
NHS Providers works with NHS England and Monitor on developments in these two areas to ensure that our members are properly paid for the care they deliver to patients, but are also supported locally to design the most appropriate payment and contracting mechanism for their local circumstances
There is a large debate on alternative payment systems to these two systems however, with new and innovative approaches being proposed and used. You can find out more about these, and our views on them, by looking through our resources.