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December 5, 2014

Individualised funding: 5 areas to tackle

Five areas that organisations need to address to ensure they can offer choice and control in a client directed funding model.

Along with many other sectors – including disability, health and housing – the funding of mental health services is undergoing significant reform from a block funded model to ‘client directed’ or ‘individualised’ funding. This shift promises to give individual clients greater choice and control in accessing services and managing their own lives. Transitioning to this consumer-focused model requires a huge change in the way organisations deliver services and engage with clients.

In the northern suburbs of Melbourne, a consortium of three community mental health organisations – Mental Illness Fellowship Victoria, cohealth and Merri Community Health Services – recently completed the Choices: Building a Good Life Pilot Project (Choices Project). This eight month pilot supported close to 50 clients to access personalised packages of up to $9,000. While it was a small sample size with a limited timeframe, key lessons were learnt about how best to support clients in preparation for changes to Victorian mental health funding and the roll out of the National Disability Insurance Scheme (NDIS). As Laura Collister, the Director of Mental Health Services, Research & Development at Mental Illness Fellowship Victoria said, “the reforms present huge operational challenges for organisations”.

It is essential to have the same advisor or planner to help at each stage of the process…

SVA Consulting worked with the consortium to establish the program logic and measurement and evaluation framework for the pilot. At the end of the pilot, SVA Consulting reviewed the effectiveness and efficiency of the project implementation, and highlighted key findings from participants’ experiences, as well as the lessons from service delivery and the governance arrangements.

Based on the evaluation, this article highlights five key areas that organisations need to address in transitioning to individualised funding to ensure that clients do have choice and control.

1. Consistent support and time is needed to help people make decisions

People need support and time to make informed decisions about the services and programs to use. It is essential to have the same advisor or planner to help at each stage of the process, from assessment and goal setting to referrals and engaging with programs. This support is particularly important to ensure that people with restricted capacity or additional vulnerabilities can fully participate in, and access, their preferred services. Flexibility is required in the planning support, as different people need varying levels of time with a planner and time to consider their options and decide what they need.

The Choices Project allowed clients to build a strong relationship with their planner, called a Support Advisor. Having the same Support Advisors provided clients with consistent and ongoing support to identify recovery goals and pick options to achieve these goals, as seen in the service delivery process outlined in Figure 1.

Figure 1: The service delivery process in the Choices Project

Support Advisors provided each client with, on average, three hours of support per month, from the intake interview and assessment through to developing the plan and budget and assisting in referrals.

Clients found that the Support Advisors were essential in supporting them to work through the options…

“Choices highlighted the importance of having the time and flexibility to work with consumers to understand what is important to them, and their vision for their life,” said Angela Micheletto, Practice and Research Leader at cohealth. “This was an essential part of identifying and discussing meaningful options with the consumers.”

Clients found that the Support Advisors were essential in supporting them to work through the options and settle on the right choices, which often took a lot of time. Project staff reflected that this support role needed to be explicitly factored into service design and individual budgets.

People with higher needs, younger people and people from culturally and linguistically diverse (CALD) backgrounds were under-represented in the participant cohort. This may have been due to pilot eligibility requirements, clients with higher needs being uncomfortable exercising choice, and limited opportunities for CALD clients to participate in many programs due to language barriers amongst other reasons. In the future, staff and programs will need the capabilities to support more diverse clients.

2. Clients need to be offered a variety of services and activities

Individualised funding should allow clients to access (new) activities and services from more than one organisation, and be flexible to respond to an individual’s changing needs. A set of wider, more flexible options offers real choice and control and can improve client outcomes.

The Choices Project menu offered 52 mental health programs across the organisations and had enough information for clients to make informed choices. As each organisation offered different types of services, the collaboration allowed clients to have broader choices than being a client of just one organisation. Support Advisors provided them with the information to know what programs were available and offered suggestions for activities that they may not have considered before that were aligned with their goals.

…some people chose what they knew but others were willing to try something different to achieve their goals.

There was some concern before the pilot that people would only be attracted to social or creative group activities instead of individual recovery-focused supports, as these can appear to be more fun and attractive. However, following the pilot, staff reported that participants made considered, purposeful choices when selecting programs. As Collister noted, “Choices told us that some people chose what they knew but others were willing to try something different to achieve their goals.”

3. Programs need to be effectively marketed to potential clients

Under the individualised funding model, providing excellent programs alone will not be enough. To attract clients, organisations will need to develop excellent communications and marketing skills to inform potential clients of the different programs they provide. Programs need to be marketed to the people supporting clients’ decisions, whether they are family, friends or a formal case manager or planner, so they are aware of the programs and their benefits.

You have to have different marketing for different customers.

In the Choices Project, each organisation took a different approach to marketing their programs to potential clients. The level of information provided ranged from a simple flyer with the program name and time to a flyer with a detailed explanation of past client skill development and recovery outcomes. The simple flyers generated more interest with clients.

“It was a lesson in how you stratify your marketing materials,” said Collister. “You have to have different marketing for different customers. The NDIA will want to know that your services deliver skill development and outcomes. Some clients want to know who is running the program, that they trust and respect the providers, and that it will be fun and engaging.”

4. Organisations need to be clear on the costs of program delivery

To accurately price programs, organisations need to track the full costs of delivering these programs. Building this capacity will be vital for organisations to be sustainable when they transition to an individualised funding model.

Choices uncovered that we didn’t know how to cost our services…

This process proved difficult in the Choices Project, as the organisations had a limited understanding of how much time workers actually spent on different support programs, and each organisation took a different approach to price setting for the menu. In addition, the organisations did not build in the cost of the extra effort (to service the Choices Project) such as follow-up phone calls with participants and general administration.

“Choices uncovered that we didn’t know how to cost our services,” said Collister. “In preparation for the NDIS, we need to get a clear idea of costs to see what we can and can’t afford to deliver.”

5. A major shift in client and employee mindsets is required

Changing to an individualised funding model requires a significant shift in how staff think about their work as well as how clients view accessing services. For many community organisations, moving to an individualised funding model signals a more commercial way of operating, and some employees, as well as clients, distrust and resist this change which can hinder implementation.

…many organisations will be challenged by this cultural shift.

During the Choices Project the individual plans for clients were limited by a maximum budget size. However, staff found it difficult to help clients understand the concepts of a budget and of putting a monetary value on services especially if they had been receiving them for free for years. Staff also found it difficult to tell participants that (to remain part of the pilot) they could no longer participate in a program that they had in the past because it was outside their budget. Staff also felt uncomfortable about charging for each hour of support and service delivery.

Viewing service delivery as a commercial transaction requires a huge change in mindset, and “many organisations will be challenged by this cultural shift,” said Collister.

The benefits to clients of an individualised funding model

Overall, clients who participated in the Choices Project found it beneficial. Most clients felt more empowered and confident and were able to choose from a wider variety of programs than one organisation could offer. Clients were inspired to try things that they wouldn’t normally do. Some expressed surprise at being able to tell their Support Advisor what they wanted and needed and that as a result they had felt seen and respected.

Most participants did not spend their entire budget; they were realistic about how many programs they had time to attend…

Reflecting on the benefits to clients, Tassia Michaleas, General Manager of Family and Community Support Services at Merri Community Health Services, said that, “it is important that we re-orient our service provision so that our clients have the opportunity to receive services that will truly support them in both their recovery and in their participation in community”.

Clients chose programs that aligned with their recovery plan. Most participants did not spend their entire budget; they were realistic about how many programs they had time to attend and what they needed to achieve their goals. Mostly clients continued to choose core services that they knew they needed, as well as selecting programs with opportunities to meet new people and pursue hobbies to enhance their wellbeing. The most popular types of programs by menu category were health programs followed by creativity, recovery and personal development programs.

These lessons can inform how organisations respond to the NDIS

Through the pilot and the evaluation these organisations have learned a number of lessons around how to deliver services within an individualised funding model. They found that they can offer real choice and control to clients if they shift their approach to service delivery. According to Collister, “We are now thinking about the Choices experience in the context of the NDIS – what does it mean from an organisational perspective and from a consumer perspective?”

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