Connecting costing and causality to real-world decisions.
Ideas, provocations, and reflections on the future of NHS costing.
April 2026
When the Conference ends
your influence shouldn't
Date: 16/04/26
The recovery system that stops people recovering
Martin Lewis was on LBC talking about council tax debt recovery. It's not the kind of thing that usually stops you in your tracks. But it did.
Because when you start thinking about how debt enforcement lands on real people, it's hard to let go of.
Cycle
The Money and Mental Health Policy Institute has been sitting with this for years. People in problem debt are three times more likely to have a mental health problem. People with mental health problems are significantly more likely to fall into financial difficulty. It goes both ways. It feeds itself. And pressure — the kind that debt recovery tends to apply — doesn't break the cycle. It tightens it.
Someone already overwhelmed doesn't get a letter threatening enforcement and think: right, I need to sort this. They shut down. They stop opening post. They go quiet. And the system, seeing no response, escalates. Which makes everything worse.
So what's the point of that?
Evidence
The research is pretty unambiguous on this. The Money and Mental Health Policy Institute found that 86% of people with mental health problems said their financial situation had made their mental health worse. StepChange, the debt charity, reported that people seeking debt help wait an average of 12 months before asking — a year of mounting pressure, deteriorating wellbeing, and narrowing options. The Money and Pensions Service found that only 17% of people in financial difficulty sought help from a financial guidance source. Most people aren't avoiding help because they don't want it. They're avoiding it because the system feels impossible to navigate when you're already struggling.
Cost
If the goal is actually recovery — of money, of stability, of someone's ability to function — then systems that increase distress are working against themselves. The Centre for Mental Health puts the cost of mental health problems to the UK economy at over £100 billion a year. Research from the Money Advice Trust found that local authorities using more flexible, supportive approaches to council tax debt saw better collection rates over time, not worse. Debt advice combined with mental health support has been shown to pay for itself. Designing for human reality isn't a soft option. It's just a more effective one.
Design
This isn't about letting people off the hook. It's about asking whether the hook is even working.
The Money and Mental Health Policy Institute has been asking that question quietly for a long time. It matters that voices like Martin Lewis are asking it loudly.
Because the link between money and mental health isn't complicated once you see it. It's just easy to design around when you're not the one living it.
Date: 06/04/26
“One of the things a university is supposed to teach you is how to work hard at something you don’t enjoy.” - John Cleese
Not exactly an inspiring quote… but it does make you think.
Because a lot of the work that actually matters doesn’t feel especially enjoyable in the moment. It tends to sit in the messy bits — the things that don’t quite add up straight away, the questions that take longer than expected, the parts that require a bit more patience than you’d like.
Sport is a good example of this. The visible moments — the race, the match, the medal — are only a tiny fraction of what’s going on. Most of the time is spent in training. Repetition, routine, and a kind of quiet discipline that doesn’t always look that interesting from the outside.
The best teams seem to master that. Not just the big moments, but the ability to stay consistent in the parts that aren’t especially exciting.
Work feels similar. The outcomes we notice are only a small slice of it. The rest — slower, less obvious, sometimes frustrating — is where most of it actually happens.
Plixology is one way of approaching that. A discipline for staying with the right things, and maintaining focus even when the work isn’t the most obvious or immediately rewarding.
Date: 04/04/26
Strategic abandonment is the idea that improving your life (or costing function) isn’t just about adding better things—it’s about deliberately letting go of things that are no longer worth it.
It sounds simple, but it’s surprisingly rare. Most people just keep stacking new commitments on top of old ones like a badly managed Jenga tower.
The core idea:
Instead of asking:
“What should I start doing?”
You ask:
“What should I stop continuing?”
Because a lot of what you’re doing right now made sense once—but doesn’t anymore.
What it looks like in practice
At work:
- Dropping a project that’s “fine” but going nowhere
- Stopping reports no one actually reads
- Saying no to meetings that exist out of habit
In personal life:
- Letting go of routines you’ve outgrown
- Reducing time with people who drain you (politely, not dramatically)
- Quitting goals you don’t actually care about anymore
In general:
- Ending things that are good enough to continue but not good enough to justify
That middle category is the real trap.
Why it matters
Your time and energy are fixed.
Every “meh” thing you keep is quietly blocking something better.
Strategic abandonment is basically:
Making space before trying to optimize.
Here's a simple way to try it today...
Ask yourself:
“If I weren’t already doing this, would I choose to start it today?”
If the answer is no… that’s a candidate.
Date: 02/04/26
We like to think we make decisions based on logic, experience, and good judgement.
But a lot of our behaviour is shaped by something much simpler.
The same principle behind a Skinner box.
Press the lever.
- Sometimes you get a reward.
- Sometimes you don’t.
- So you keep pressing.
It turns out that unpredictable rewards are the most powerful of all.
Which might explain a few things.
- Why we check our inbox more often than we need to.
- Why dashboards get refreshed before anything has really changed.
- Why some metrics quietly pull attention, even when they don’t change decisions.
It’s not always strategy.
Sometimes it’s just reinforcement.
And once you see it, it raises an interesting question.
How much of what we do at work is actually driven by deliberate thinking… and how much is shaped by the feedback loops we’ve built around ourselves?
Because if the signals are noisy, inconsistent, or rewarding the wrong things…
we shouldn’t be surprised by the behaviour that follows.
Date: 02/04/26
Not everything that matters shows up in the data
There’s a famous WWII study that mapped bullet holes on returning aircraft.
At first glance, the answer felt obvious: reinforce the areas getting hit the most. More holes, more risk.
But that wasn’t the insight, those planes made it back.
The real problem was the areas with no bullet holes — because the planes hit there didn’t return.
It pops up more often than you’d think when you’re working with data.
Because data is powerful… but it doesn’t tell the whole story.
We tend to focus on what it shows us. The high-cost pathways. The outliers. The parts of the system that are visible enough to measure and compare. It feels like progress because it’s grounded in evidence.
But those are the planes that made it home.
They’re the parts of the system that are visible because they’ve already survived the process.
What about everything else?
The constraints that don’t quite show up in the numbers. The decisions made in real time about staffing, theatres, clinics and diagnostics. The points where flow breaks down, but not in a way that creates a neat costing signal.
That’s the part data struggles with on its own.
It gives us a picture — but not always the full one.
Which means the real work isn’t just analysing what’s there.
It’s asking what’s missing.
Because understanding a system is about connecting that data to how things actually work on the ground.
That’s where the conversation gets interesting.
March 2026
Costing reveals truth, not just numbers.
Date: 30/03/26
What’s the ultimate why in healthcare?
Not the polite answer. The real one.
We talk about targets, productivity, financial balance, trajectories, transformation plans. And they matter. Without them, the system drifts.
But are they the reason healthcare exists?
If you strip it back far enough, isn’t it about suffering?
Pain that needs easing. Fear that needs calming. Function that needs restoring. Time that suddenly feels very precious.
We’ve become highly fluent in the language of activity and cost. Less fluent in the language of relief. We can explain throughput, WTE, utilisation, variance, and pounds per case. But how often do we pause and ask: did this reduce suffering - and if so, how?
Maybe this isn’t just a leadership question. Maybe it’s a personal one.
Every NHS employee - clinical, operational, corporate - could quietly run the same test against their own work:
Does this task reduce suffering?
If yes, how exactly?
If not, why are we doing it?
That’s not an attack on governance or reporting or financial control. Many of those tasks absolutely do reduce suffering - indirectly. Good rostering prevents burnout. Good costing prevents poor decisions. Good data prevents blind spots.
But the link should be traceable.
If we can’t explain how a piece of work connects, however indirectly, to reducing suffering or preserving dignity, then it’s worth asking harder questions about it. Not cynically. Curiously.
What would change if that became our organising principle?
Would productivity start to mean “more relief, sooner, with the same resources”?
Would flow mean removing the friction that prolongs distress?
Would improvement be judged by how much unnecessary suffering we prevented?
The ultimate why might be almost embarrassingly simple.
Reduce suffering. Preserve dignity. Restore capability.
Everything else is method.
The question is whether we can see the line between what we do today - even the spreadsheet, even the meeting - and the suffering we’re here to reduce.
Date: 26/03/26
Is NHS Costing solving the right problem?
For the last decade the NHS has invested heavily in patient-level costing.
PLICS (Patient Level Information and Costing Systems) have transformed the visibility of cost. We can now see the cost of care at the level of individual patients, episodes, procedures and pathways. Billions of lines of data are produced every year, mapped across activity, departments and services.
From a technical perspective, this is a remarkable achievement.
But there is an uncomfortable question sitting just beneath the surface.
Is costing actually helping the people running services make better decisions?
Because while costing capability has advanced dramatically, the operational pressures facing services have not eased. Waiting lists are growing. Emergency departments remain under strain. Staff shortages and resource constraints continue to shape daily decision making.
Which raises a more fundamental issue.
Are we asking costing to solve the right problem?
The Hidden Assumption in Traditional Costing
Most traditional healthcare costing models are built around a simple idea:
Cost follows the patient.
Activity happens, resources are consumed, and costing systems allocate those costs back to the patient encounter. The result is a detailed financial description of what has happened.
This approach works well for certain purposes - particularly tariff setting, benchmarking and regulatory reporting.
But it carries an important assumption.
It assumes that demand is the primary driver of cost.
Yet when you talk to clinicians and operational managers, a different picture often emerges.
They rarely feel in complete control of demand. Patients arrive when they arrive. Emergency departments cannot schedule crises. Hospitals do not decide how many people become unwell tomorrow.
What operational teams actually control is something else entirely.
They control how care is supplied.
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Demand isn't necessarily the driver of cost
Cost Is a Consequence of Supply Decisions
Every day, operational teams make thousands of decisions that shape the supply of care:
- How many staff are on shift
- When theatre lists start and finish
- How clinics are scheduled
- How diagnostic capacity is deployed
- How resources move across departments during the day
These decisions determine how the system responds to demand.
They also determine how resources are used - and therefore how cost is created.
In this sense, cost is not really “caused” by the patient. It is the result of the resourcing choices we make to meet demand.
But most costing models barely represent this side of the equation.
They describe activity in extraordinary detail, yet often say very little about how the operational system that produced that activity actually behaves.
And that is where a different perspective begins to emerge.
From Costing Data to System Understanding
If costing is going to become genuinely useful for operational decision making, it needs to do more than allocate costs after the event.
It needs to help teams explore questions like:
- Where does pressure build across the day?
- Are we staffing services in line with actual patterns of need?
- Where are resources under-utilised or stretched?
- What operational changes might improve productivity without compromising care?
The good news is that much of the underlying data already exists.
Activity data, rostering data, utilisation data and costing data all capture different perspectives on the same system.
The challenge is not collecting more data.
The challenge is thinking differently about how we use it.
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Costing data captures different perspectives
Enter Plixology
This is the idea behind Plixology.
Plixology is not a new costing system or a new methodology. It is a way of thinking about healthcare costing that focuses on the interaction between supply and demand within real operational systems.
Instead of treating costing purely as a financial reporting exercise, Plixology treats it as a way of exploring how healthcare systems actually behave.
It asks different kinds of questions:
- What does the supply of care look like across time?
- How do operational decisions shape cost patterns?
- Where does variation emerge within services?
- And how might teams redesign the system to improve both productivity and patient experience?
In this view, costing becomes less about explaining the past and more about helping teams understand the system they are working within.
From Regulatory Requirement to Strategic Asset
PLICS has already achieved something important: it has made the cost of care visible.
The next step is making that visibility useful.
That means connecting costing data to operational reality — to the way services are staffed, scheduled and delivered in practice.
If we can do that, costing stops being something organisations produce for regulatory compliance.
Instead, it becomes something operational teams can use to explore their system, test ideas, and make better decisions about how care is delivered.
And that is where the real opportunity lies.
Because the future of costing may not be about producing more data.
It may be about helping us ask better questions about how healthcare systems actually work.
Plixology Is a Discipline, Not a Product
It is important to be clear about one thing.
Plixology is not a product, it is a discipline.
A way of thinking about healthcare costing that focuses on how supply, demand and operational decisions interact inside real health systems.
The intention is not to replace existing costing approaches such as PLICS. Those systems have already created something incredibly valuable: visibility of cost at the level of care delivery.
Plixology simply asks a different question.
If we already have this visibility, how can we use it to understand the system that produced those costs?
The future of costing may not lie in producing more data.
It may lie in helping us understand the systems that create it.
Plixology is simply an attempt to name and explore that discipline.
Date: 20/03/26
Does PLICS Need a Rebrand?
PLICS stands for Patient Level Information and Costing System.
It’s a technical name, and in many organisations it’s treated exactly that way - as a finance system designed to calculate patient-level costs.
But when you actually look at what PLICS contains, it’s something much more interesting.
It links activity, patient stream, workforce time, diagnostics, theatres, beds, and overheads and more into a single structured view of how care is delivered.
In other words, it’s not just costing data.
It’s a map of how the healthcare system actually operates.
The problem is that the word “costing” quietly limits how people think about it.
- Clinicians hear finance.
- Operational teams hear budget scrutiny.
- Exec teams hear efficiency pressure.
But the real opportunity is much bigger.
PLICS is one of the few datasets that connects supply and demand inside the patient stream.
That means it can help answer questions like:
- Where does time accumulate in the stream?
- Where does capacity constrain flow?
- Where does variation actually matter?
Those aren’t just costing questions.
They’re system design questions.
Which is why I sometimes wonder whether PLICS needs a rebrand.
Not a technical one but a conceptual one.
Less Patient Level Costing.
More Patient Level System Understanding.
That’s essentially the idea behind Plixology - Not just treating PLICS as a finance output, but as an information product helping stakeholders to understand how care systems behave.
Because once you see the system clearly, the costs tend to explain themselves.
Date: 16/03/26
“People believe almost anything… if their salary depends on it.”
Most of us don’t wake up trying to defend a position at all costs. But we do operate inside systems. Our roles, our performance measures, our credibility, even our sense of professional identity are tied to certain outcomes. Over time, that shapes what feels sensible. What feels obvious. What feels beyond question.
- If your team’s funding depends on demonstrating demand, demand becomes very visible.
- If your success is measured by financial grip, control becomes the lens.
- If your credibility rests on technical accuracy, precision naturally takes centre stage.
None of that is wrong. It’s human.
The interesting bit is what quietly fades into the background. What questions don’t get asked because they’re not immediately helpful to the story that sustains us? What assumptions go unchallenged because they align neatly with how the system rewards us?
In costing - and in most organisational life - belief isn’t just about evidence. It’s about context. About incentives. About the narratives that make our work make sense.
So perhaps the gentler question is if the incentives shifted tomorrow, would our conclusions shift with them?
That’s not an accusation. It’s just an invitation to stay curious - especially about the stories that feel most comfortable to tell.
Date: 10/03/26
“Should costing support confirmation bias?”
That question came up after a presentation I did recently.
It made me pause.
Not because it’s wrong - but because it assumes the problem sits over there, with the people using the data.
My instinctive response was this:
I’m not sure supporting someone else’s bias is really the issue.
I wonder if the more interesting question is whether we’ve spent enough time examining our own.
Costing is often described as neutral. Objective. Just “showing the numbers”.
But is it?
Every model involves choices:
What we include and exclude
What we treat as demand versus capacity
What gets smoothed out, averaged, or labelled as unavoidable
None of those are bad things.
They’re just… decisions.
And decisions shape stories.
So when someone comes to a costing conversation with a strong prior view, maybe the question isn’t:
“Are they trying to get the data to confirm what they already believe?”
Maybe it’s:
“Which assumptions are sitting quietly inside the model - and which ones are we defending without noticing?”
I sometimes wonder whether costing has its own default narratives:
- That if the numbers look precise, the explanation must be correct
- That bigger datasets automatically mean better understanding
- That disagreement with the output usually means someone “doesn’t understand the data”
Those ideas might be right.
Or they might simply be familiar.
Good costing, in my experience, doesn’t try to agree or disagree with someone’s perspective.
It does something more subtle.
It changes the question.
Not: “Is this service high cost?”
But: “High cost relative to what context, what choices, and what constraints?”
Not: “What’s driving the numbers?”
But: “Which parts of this outcome are shaped by demand - and which by how the service is organised?”
If costing leaves everyone’s thinking exactly where it started, that might be worth noticing.
Perhaps the value isn’t in confirming or challenging bias at all - but in making the assumptions on both sides a little more visible.
That’s the conversation I think costing is best placed to support.
Date: 08/03/26
Every Day Starts at Zero
We talk about productivity in terms of cost per case and output per WTE. But strip all that away and it comes down to one thing: time.
When we improve productivity, what we’re really saying is that we’ve created time. Time back to doctors. Time back to nurses. Time back to AHPs. Time to think, to listen, to treat, to make better decisions. That’s the real currency of the front line.
But time is different to money. You can carry forward unspent budget. You cannot carry forward an unused clinic slot. You cannot bank a quiet afternoon.
Unused time doesn’t sit in reserve.
It disappears.
That’s why productivity has to be intentional and repeatable. If released time isn’t deliberately redirected into seeing patients, improving outcomes or easing pressure, it won’t sit waiting to be used - it will be swallowed by the system and lost in the noise.
So maybe the question isn’t whether output per WTE has gone up. Maybe it’s whether we are deliberately turning protected clinical time into measurable value.
Because once today is gone, it’s gone.
Can you afford for your time to go unused?
Date: 06/03/26
What Does Productivity Actually Mean in the NHS?
We talk about “productivity” in the NHS as if everyone means the same thing.
They really don’t.
Ask different people what productivity means and you’ll get very different answers.
- For Treasury, it’s more activity for the same money.
- For regulators, it’s flow - waiting lists, throughput, timeliness.
- For operational managers, it’s whether staff, beds, theatres and scanners are actually being used well.
- For clinicians, it’s doing the right work and cutting out waste.
- For patients, it’s fewer interactions for better outcomes.
All of those definitions make sense.
The problem is that costing usually picks just one.
In costing conversations, something subtle often happens. Productivity quietly becomes lower cost per episode.
It might be framed slightly differently - cost per case, cost per spell, output per WTE, activity per WTE. But the underlying assumption is usually the same: if the unit cost falls, or output per WTE rises, productivity must have improved.
Is that necessarily true?
An episode is the outcome of how a system behaves, not the cause of it. It blends necessary work and avoidable work. It hides variation, bottlenecks, rework and substitution. And WTE data, useful as it is, doesn’t tell us whether we’ve redesigned work intelligently or simply stretched the same people thinner.
If output per WTE increases, is that because processes improved? Because demand was managed differently? Because skill mix shifted? Or because the same supply is absorbing more pressure?
Perhaps the more important question is what our limited supply - staff time, clinical capacity, physical assets - was actually used for. Did it genuinely improve outcomes? Did it stabilise flow? Or did it create avoidable demand somewhere else in the system?
I’m starting to think the NHS doesn’t just have a productivity challenge. It has a productivity definition challenge.
If we defined productivity around how effectively supply is used - rather than how cheaply we process episodes - how different would our decisions look?
Date: 03/03/26
NHS spending has doubled. Outcomes haven’t shifted.
An interview in The Telegraph this week makes a stark point: NHS funding has risen from around £100bn to £200bn in under two decades - yet life expectancy has stalled and health inequalities persist.
The argument isn’t just about money. It’s about impact.
If doubling spend doesn’t move the dial on healthy life expectancy, the uncomfortable question becomes: What exactly are we optimising for?
This is where costing becomes mission-critical.
Because without clear, outcome-linked costing:
- Spend looks like a sunk cost rather than an investment
- Prevention struggles to compete with acute demand
- Waste is debated emotionally, not evidenced analytically
- Treasury frustration becomes inevitable
Good costing isn’t about producing thicker reports.
- It’s about exposing how resources actually flow through pathways.
- It’s about linking pounds to outcomes, not just activity.
- It’s about understanding whether we are funding health - or simply funding motion.
From a Plixology perspective, this is the pivot:
When time, capacity and cost are seen as a connected system, you stop asking “How much did we spend?” and start asking “What did that spending change?”
In an era of demographic pressure and flatlining outcomes, that shift isn’t technical.
It’s existential.
The charts within the follow-up article make the tension clearer.
- Funding has moved from £100bn to over £200bn.
- The workforce has grown significantly.
- Productivity has shifted only marginally.
That gap shouldn’t immediately become a political argument. It’s a structural one.
Because when inputs rise materially faster than outputs over a sustained period, the issue is rarely effort. It’s how the system translates resource into value.
We are precise about how much is spent.
We are less precise about how cost behaves once it enters the operational bloodstream.
Additional funding can stabilise pressure without improving throughput.
- It can compensate for complexity that averages conceal.
- It can protect quality while productivity statistics barely move.
If we only look at totals, we flatten all of that into a single line on a chart.
This is where the Plixology framework becomes relevant - not as commentary, but as structure and discipline.
- If strategy is unclear, costing drifts from the decisions that matter.
- If modelling doesn’t reflect operational reality, numbers detach from behaviour.
- If data isn’t credible and enriched, variation is misread.
- If analytics doesn’t translate into influence, insight stalls at reporting.
When those four pillars are not aligned, large investments can land without impact. We add workforce, but don’t materially change trajectory. We increase spend, but don’t shift flow.
The question Trusts need to ask is whether the costing architecture is strong enough to explain - and shape - what that expansion actually does.
If productivity has only moved 5%, the conversation cannot just be about how much we fund the NHS next.
It has to be about whether our Strategy, Modelling, Data and Analytics are robust enough to ensure that the next £100bn behaves differently from the last.
February 2026
Precision in cost creates freedom in choice.
Date: 26/02/26
Is high-skill time getting absorbed by low-value tasks?
Take something simple. A consultant spending hours sorting out the rota. Plugging gaps. Swapping shifts. Chasing leave forms. It feels necessary — and often it is. The service can’t run without a rota.
But step back for a moment.
That’s some of the most expensive, highly trained clinical time in the organisation being used to solve an administrative design problem.
The ledger records consultant cost.
What it doesn’t show is the capability we quietly lost while that time was redirected.
Multiply that across a system — senior nurses rechecking spreadsheets, clinical leads troubleshooting booking errors, experienced managers firefighting avoidable friction — and you start to see the pattern.
Cost drifts upward.
Throughput doesn’t.
Quality doesn’t necessarily improve.
Because we haven’t increased capability. We’ve just diluted it.
If the real constraint — how scarce, high-skill time is actually being used — isn’t visible, improvement plans tend to circle around the symptoms. More targets. More scrutiny. More pressure on activity.
Instead of asking a simpler question:
Where is our most valuable time really going?
Until we can see that clearly, we’re not really managing cost.
We’re managing the consequences of design.
Date: 25/02/26
If It Doesn’t Add Value, Why Are We Doing It?
In healthcare costing, once waste is made visible, there are only four real options.
1. Stop it.
If an output doesn’t influence a decision, doesn’t change behaviour, and isn’t required for compliance - why does it exist?
Deleting work is uncomfortable. But nothing frees capacity faster than removing activity that shouldn’t be there in the first place.
2. Automate it.
If the task matters but the method is manual, automate the routine elements. Data preparation. Standard costing packs. Validation checks.
Automation doesn’t just save hours. It reduces variation, improves reliability, and protects analytic time for interpretation - not formatting.
3. Combine it.
Costing, performance, and operational reviews often run on separate tracks.
Align cycles. Merge overlapping analyses. Embed costing insight directly into operational forums instead of producing standalone outputs.
Flow improves when insight travels with the conversation.
4. Outsource it.
Some work needs specialist input, but not permanently. In those cases, flexible or external support can protect scarce internal capability.
The goal isn’t outsourcing responsibility - it’s concentrating attention where it genuinely shifts decisions.
When capacity feels tight, the instinct is to ask for more resource but the better question might be which of these four decisions haven’t we made yet?
That’s where the leverage sits.
Date: 24/02/26
Waste in the NHS Won’t Just Disappear. It Has to Be Designed Out.
Once waste becomes visible in healthcare, something shifts. Awareness is important - but it’s rarely sufficient on its own.
What tends to follow is less about tools and more about orientation. A different way of looking at flow. At ownership. At scale. At how effort moves through the system.
See it
Waste rarely announces itself. It tends to sit in the gaps between stages- in delays, duplicated conversations, partial handovers, and workarounds that feel normal. When the pathway is viewed as a connected flow rather than isolated steps, that friction becomes easier to notice.
Recognise it
Not all activity creates value in the same way. Some steps directly improve patient outcomes. Some are necessary but indirect. Others persist through history rather than design. Shared clarity around these differences changes the quality of improvement conversations.
Assign responsibility
Waste often lingers where ownership is diffuse. When processes sit broadly “with the system,” variation and delay can become part of the background. Clear responsibility doesn’t solve everything - but it does shift how issues are seen and addressed.
Measure the scale
Perception changes when magnitude becomes visible. Even approximate signals of time, frequency, or capacity absorbed can reframe what once felt anecdotal into something structural.
Eliminate - and revisit
Healthcare environments are not static. Demand and load patterns evolve. Workforce models shift. Pressures fluctuate. Improvements therefore sit within moving conditions - and without attention, friction tends to reappear quietly.
Reducing waste isn’t about asking teams to work harder.
It’s about understanding how effort is currently flowing - and where it could flow better for patients.
Date: 19/02/2026
The 7 Wastes in Healthcare
In healthcare we talk constantly about pressure. Rising demand. Constrained budgets. Not enough capacity. And all of that is real. But pressure isn’t created by volume alone. It’s also created by friction in how work flows through the system.
When you look at the classic seven wastes through a healthcare lens, they’re not abstract ideas from manufacturing textbooks. They’re daily operational realities.
Overproduction shows up when clinics are scheduled before diagnostics are ready, or when follow-ups are booked “just in case” rather than because clinical value is clear. Work is created because the template says so, not because the patient needs it.
Waiting is everywhere. Patients wait for results, for decisions, for discharge. Staff wait for notes, for rooms, for IT to load. Theatre time waits for turnaround. Highly skilled, highly paid time stands still.
Transport and motion often hide in plain sight. Patients travel between sites for fragmented services. Samples move across town. Clinicians walk corridors searching for equipment. Admin staff jump between systems that don’t speak to each other. None of it looks dramatic. All of it consumes resource.
Over processing appears as duplicate data entry, multiple forms capturing the same information, layers of review that feel safe but add little value. Inventory sits quietly in the background as waiting lists, backlogs, work queues and unreported results — stock, just in a different language.
And then there are defects. Coding errors. Missing information. Rework. Avoidable complications. The kind of waste that costs twice — once in money, once in human impact.
Most costing systems are very good at telling us the cost of activity. They are far less good at isolating the cost of waste.
If a clinic runs half empty because of template design, that cost is averaged into the attendance. If a patient attends twice because something wasn’t right the first time, it becomes two legitimate episodes. If a consultant spends an hour firefighting rota gaps, it dissolves into overhead. The resource absorbs it. The ledger balances. The narrative looks neat.
But the system still feels stretched.
So perhaps the more useful question isn’t simply, “What did this cost?” It might be, “Where is resource being consumed without reducing suffering?”
In healthcare, waste isn’t about working harder or blaming people. It’s about effort that doesn’t move a patient meaningfully closer to better. If we looked for that with the same discipline we apply to counting activity, what would we notice? And just as importantly, what might we finally feel confident enough to stop doing?
Date: 18/02/2026
What exactly counts as waste in healthcare?
We often default to thinking it’s overspending. But waste isn’t just money going out of the door. It’s work that consumes resources without adding value - work that exists because of how the system behaves, not because of what the patient actually needs.
If something uses staff time, space, diagnostics or equipment, it gets costed. Once it’s attached to a patient and flows through PLICS, it feels legitimate. It becomes part of the “cost of care.” But being costed doesn’t automatically mean it was necessary.
Now consider two patients with the same clinical need. One moves through the system without friction. The other encounters delays, duplicated steps, repeated tests, handoffs and escalation. From a reporting perspective, they can look broadly similar. From a resource perspective, they are completely different stories.
Where does that difference show up?
Waiting time is absorbed into staff cost. Rework becomes activity. Repeated diagnostics look like throughput. Backlogs are interpreted as rising demand rather than constrained supply. The system’s coping mechanisms get normalised because they are consistently recorded and reconciled.
So when costs rise, the instinct is to ask whether demand has increased. Sometimes that’s true. But sometimes what we are seeing is supply under strain - capacity misaligned, processes fragmented, roles stretched - and the resulting behaviour generating extra work.
If waste is work created by the system rather than by patient need, then a demand-focused lens will struggle to isolate it. It will price it. It will allocate it. But distinguishing necessary care from system-generated effort requires a clearer view of how resources behave under pressure.
Until we can separate demand from supply behaviour, we risk becoming very good at explaining cost - while missing the opportunity to redesign the work that is driving it.
Date: 17/02/2026
If It Doesn’t Change Income, Does It Still Matter?
A recent comment I saw raised an important point about payment mechanisms and PLICS.
The reflection was this: if teams reduce complications or shorten length of stay, but income remains unchanged under block or average tariff models, it’s hard to expect deep engagement with PLICS. The data may show what really happened to patients, but if funding is still based on averages, the financial impact can feel unclear. And without aligned incentives, sustained change may be difficult.
It’s a thoughtful challenge - and one I think many people quietly share.
In my reply, I suggested that this may reflect a common misconception about what PLICS is for.
PLICS isn’t primarily an income justification tool. It’s about understanding the cost of supply and identifying causality - what actually drove resource use, and why. Which elements of care increased staffing intensity? What extended length of stay? Where did variation genuinely occur?
Payment mechanisms undoubtedly shape behaviour. They always have, and they always will. But PLICS operates at a different level. It helps us understand how the system functions beneath the averages that tariffs and blocks are built on.
That understanding has value in its own right.
If improvement doesn’t immediately change income under a particular payment model, that’s a feature of the mechanism - not a limitation of the insight. The operational learning still matters. In fact, it arguably becomes even more important.
Perhaps the real question is whether we’re clear about what problem we’re asking it to solve.
Is it there to explain income?
Or is it there to explain how care consumes resources?
Those are related conversations - but they’re not the same one.
Curious to hear how others see this balance between insight and incentive.
Date: 11/02/2026
I’m not sure costing always answers the questions services are asking.
Most costing propositions are framed around the features of the teams PLICS information product: accuracy, reconciliation, compliance, timeliness. Those are qualities of the build. They say a lot about how well PLICS works, but very little about why a service would choose to use it.
From the service side, the fears are different. Fear of running out of capacity. Fear of making the wrong staffing decision. Fear of demand overwhelming supply in ways they can’t explain or control. When those fears are live, a perfectly accurate cost per episode doesn’t feel very helpful.
What services want is clarity. They want to understand where pressure is really coming from, where capacity is being lost or stretched, and which trade-offs they’re implicitly making just to keep things moving. They want insight that helps them justify decisions, not just account for activity.
And what they need is something slightly different again: information that helps them act. That means seeing supply and demand together, not demand on its own. It means understanding how clinics, rotas, beds, sessions, and staff time are actually being used - and misused.
Costing often tells a strong story about demand. Where it struggles is translating that into a story about supply behaviour. Without that translation, PLICS misses the target audience.
This is why the proposition so often falls flat. Wards and outpatients get described in episodes and averages, while services are managing utilisation, staffing gaps, and flow. Theatres receive technically impressive outputs, while worrying about lost sessions and fragile schedules. A&E may have data, but no clearly articulated offer that speaks to its operational reality.
So costing gets labelled “retrospective.” Not because it looks backwards, but because it doesn’t line up with the fears, wants, and needs the customer is trying to manage in real time.
Where things really change is when the product is reframed around the service’s risk. When costing stops saying “this is the average cost of an outpatient appointment” and starts saying “this is where clinic capacity is being lost, and why demand feels higher than it should.” Same data. But now it speaks to a fear services actually have - that they’re running flat out and still falling behind.
Date: 04/02/2026
Salience: Why Do Some Messages Stick?
Have you ever noticed how some political parties seem to talk about one thing… over and over again?
The Green Party? Inequality.
Reform UK? Immigration.
They obviously have other policies - whole manifestos full of them - but those rarely lead the conversation. Why? Because attention is limited, and people tend to remember whatever they hear most consistently.
That got me wondering:
Is this less about politics? or more about how humans process messages?
Picking one issue and letting it carry the message.
So what would it mean for costing if we did the same?
Costing conversations often try to cover too much - too many datasets, too many assumptions, too many caveats, too many variances. It’s careful, It’s technically solid and it’s very easy for the point to get lost.
If someone walked away from a costing discussion and you asked them, “What was that really about?” - would they give the same answer as you?
Salience isn’t about being simplistic or repetitive.
It’s about having a centre of gravity.
You can explore nuance.
You can take different routes through the detail.
But you keep returning to the same place.
For me, that anchor is supply and demand.
The demand created by patients.
The supply of resources needed to meet it.
Every costing insight - efficiency, capacity, service change, financial pressure - eventually traces back to that relationship. If it doesn’t, I usually start wondering what problem the costing is actually trying to solve.
Political parties use salience to win attention.
Costing teams can use it to build influence.
Pick the thing that really matters.
Stick with it.
Let everything else orbit around it.
January 2026
Costing Isn’t the Point. Clarity Is.
Date: 15.01.2025
After the crisis, which ideas are lying around?
Milton Friedman once wrote:
“Only a crisis - actual or perceived - produces real change. When that crisis occurs, the actions that are taken depend on the ideas that are lying around.”
It’s a reminder that crises don’t create new solutions. They simply elevate the ideas already on the table.
Which brings us back to costing in the NHS.
When A&E is overflowing, when ICU is under pressure, when winter demand peaks - those crises trigger action. Money moves. Resources shift. New policies are announced.
But the ideas that get picked up are shaped by what’s visible in the data.
Admissions, attendances, procedures → easy to count, easy to reward.
Prevention, stability, avoided costs → hard to see, easy to overlook.
So when the crisis comes, costing teams are too often left reinforcing the same reactive solutions. We put the visible demand story on the table - and that’s the idea leadership runs with.
But what if costing could put different ideas in reach?
▪ Show the supply-side story: the resources that absorb demand before it explodes.
▪ Surface causality: the upstream drivers behind the crisis costs.
▪ Make the invisible calm visible - so that prevention is an option lying around when the crisis hits.
Because the danger is clear: if costing only ever reflects activity, then in every crisis we’re fated to repeat the same reactive choices.
Friedman was right. Change doesn’t come from the crisis itself. It comes from the ideas already lying around.
The question for costing teams is simple:
Are we putting the right ideas on the table? Or are we just reinforcing the crisis?
December 2025
Services Don’t Experience Cost as a Spreadsheet. They Experience It as Pressure.
Date: 17.12.2025
Costing Without Borders: "What Can the NHS Learn?”
I don’t claim to be an expert in global costing systems - but it’s an area I find fascinating and thought worth exploring. After all, turning cost data into insight is a challenge every health system faces.
Here are some international approaches worth knowing about:
Germany (GPK)
A highly structured managerial costing methodology dating from the mid‑20th century. GPK integrates cost measurement into ERP systems (like SAP) for granular control and decision support. It’s praised for precision and internal insight - but criticized for complexity and resource intensity.
Canada (Ontario – OHRS)
The Ontario Healthcare Reporting Standards (OHRS) link financial trial balances with activity data consistently across hospitals, ensuring comparability and system-wide visibility. Although there are critics there's also a confidence that OHRS will prove successful.
United States (CAS & Cost‑to‑Charge Ratios)
Federal contractors follow strict Cost Accounting Standards (CAS). In healthcare, costing often relies on cost‑to‑charge ratios - consistent and enforceable, but arguably blunt and disconnected from actual resource usage.
European Union (HCSCD)
The Healthcare & Social Cost Database initiative aims to harmonize unit cost definitions across member states. It’s ambitious - but slow and politically sensitive to implement.
Australia (ABF - Activity‑Based Funding)
Here, patient-level or episode-level costs feed into national efficient pricing models. ABF has enhanced transparency and productivity, but it risks incentivizing patient volume over true value, and may underfund complex care pathways.
Saudi Arabia (Costing Reform)
As part of broader health reforms, Saudi Arabia has been pushing modern costing and activity-based methods to improve resource planning and foster private engagement. The downside: uneven implementation due to varying provider capacity.
Bangladesh (PLWS – Package-Level Weighted Costing Studies)
Pilot costing studies for essential service packages offer policymakers clearer cost insights - but sustainment is an issue. Many remain isolated, donor-funded pilots rather than embedded systems.
Why the NHS Should Be Proud
PLICS is one of the most mature and comprehensive patient-level costing systems globally. It captures data across acute, mental health, ambulance, IAPT (Talking Therapies), and community services, and has steadily rolled out since 2016.
This level of granularity and national coverage is rare internationally - and puts the NHS ahead, not behind.
That doesn’t mean there’s nothing more to learn - but it does mean we’re building from a position of strength.
This isn’t an area I claim to be fully knowledgeable about - but it struck me as interesting and worth discussing. Sometimes looking outward helps us appreciate how far we’ve come.
Date: 10.12.2025
Crisis Economics in the NHS
And how by rewarding crisis, we may be reinforcing it.
The NHS has a strange economy.
We don’t just count costs - we reward them.
When A&E fills up, when ICU overflows, when ambulances queue - those events are captured in the data, they hit the headlines, and they attract emergency funding.
Meanwhile, prevention - the quiet work of keeping people well - is harder to see, harder to measure, and easier to overlook.
- A GP who keeps a patient stable.
- A community nurse who prevents a fall.
- A diabetic who never reaches crisis point.
These are successes, but they appear as invisible costs avoided. There’s no line in the ledger that says: “Nothing happened today.”
This isn’t just observation, it’s backed by research:
The Financial Times highlighted how present bias skews health systems toward short-term fixes over long-term prevention, even though prevention is often far more cost-effective.
A JAMA Health Forum study showed that while preventive programmes improve health, they don’t always show immediate savings - meaning they lose out in annual budget cycles.
In Lancashire, community nursing teams reduced A&E attendances by up to 11% and saved £170,000 from just five patients - evidence that calm can deliver value if it’s recognised.
Where Costing Fits
Costing teams sit right in the middle of this dynamic.
PLICS and national returns are very effective at showing what happened.
But they are much weaker at showing what didn’t happen — the avoided costs, the absorbed demand, the calm maintained.
That’s why we need to expand the lens. Instead of only asking “What did this episode cost?”, we should also ask:
What demand pressure does this represent?
What supply-side factors held it steady — or failed to?
What causal patterns are hiding behind the activity data?
The Bigger Picture
Until the NHS changes the way it sees and rewards costs, it will remain caught in the cycle of crisis economics.
A system not necessarily creating more crisis, but locked into one - because crisis is what gets measured, noticed, and rewarded.
The challenge for costing isn’t just to price events. It’s to surface the invisible value of calm, to give prevention and stability a place in the story.
Date: 03.12.2025
The Benchmarking Trap: Why Average Is the Most Dangerous Number in the NHS
Part 1
Benchmarking is one of the most frequently used tools in NHS finance and costing. Its attraction lies in simplicity: a straightforward comparison against national averages or peer organisations. This apparent clarity can feel reassuring - but it is also where the risks lie.
Benchmarking frequently distorts reality. Structural differences in estate, workforce, and patient population are reduced to numbers that appear directly comparable but are not. What looks like a fair comparison often masks deeper variation.
It can also create misleading signals. Being “average” may conceal inefficiencies.
Being an “outlier” may simply reflect local circumstances. Both conclusions risk prompting the wrong response.
More importantly, benchmarking tends to direct attention towards factors that leaders cannot control - such as demographics or geography - rather than those they can, like the deployment of staff, theatres, or clinical capacity. In doing so, it risks diverting energy away from areas where change is genuinely possible.
This is not to suggest benchmarking has no value, but rather that it should be handled with caution. Used uncritically, it can encourage misplaced assurance, unhelpful anxiety, or superficial performance management.
The more useful line of enquiry is not “How do we compare?” but “How can we make better use of the resources we already have?”
👉 Where have you seen benchmarking lead to the wrong conclusions — and how might those lessons shape a better use of costing insight?
Look out for Part 2 "Benchmarking: The Case For… and the Reality Against"
Date: 05.12.2025
Benchmarking: The Case For… and the Reality Against
Part 2
Benchmarking remains one of the most widely used tools in NHS finance and costing. Advocates point to its clarity, comparability, and role in driving accountability. Yet each of these arguments has an important counterpoint, judge for yourself whether they're accurate.
1. External Reference
The case for: Benchmarking provides an external yardstick, preventing organisations from “marking their own homework.”
The case against: Most comparisons are not like-for-like. Context - estate condition, workforce model, patient mix - matters more than averages.
2. Accountability
The case for: Benchmarking highlights outliers and prompts scrutiny.
The case against: Outliers often reflect structural realities rather than inefficiency. Time is spent defending positions rather than improving what is controllable.
3. Motivation
The case for: Nobody wants to be at the bottom of a league table; benchmarking creates pressure to improve.
The case against: This often drives cosmetic fixes or data “gaming” instead of meaningful change.
4. Best Practice
The case for: Benchmarking identifies high performers, offering models to replicate.
The case against: What works in one context rarely transfers without adaptation. Copying without understanding can backfire.
5. Simplicity
The case for: Benchmarking condenses complex information into an accessible format for boards and regulators.
The case against: Simplicity at the cost of accuracy risks misleading decision-makers.
6. National Oversight
The case for: Benchmarking supports consistency and enables regulators to monitor variation.
The case against: National averages risk enforcing uniformity and penalising organisations for structural differences they cannot change.
Benchmarking is not without value. But used uncritically, it can distort priorities and direct energy away from where it can make the most difference: how organisations organise and deploy their own resources.
How do you see benchmarking - as a helpful guide, a necessary compromise, or a misleading distraction?
Look out for Part 3 "Turning Benchmarks Into Better Decisions" which looks at how benchmarks can be interrogated quickly to assess value.
Date: 07.12.2025
Turning Benchmarks Into Better Decisions
Part 3
Benchmarking is often criticised - and sometimes with good reason. But it remains a valuable tool, provided it is used with care. The real question is not whether to benchmark, but how to interpret benchmarks in a way that drives meaningful improvement.
Benchmarks can provide context, highlight variation, and spark important questions. The danger comes when they are treated as answers in themselves, rather than as prompts for enquiry.
One way to approach this is through a simple matrix:
- High comparability / High controllability → Priority for Action.
Benchmarks that show a gap in areas you can directly influence (e.g. staff deployment, theatre use).
- High comparability / Low controllability → Monitor Only.
These comparisons are valid but highlight factors outside your direct control (e.g. demographics).
- Low comparability / High controllability → Investigate Carefully.
Don’t dismiss these, but dig into local context before making changes.
- Low comparability / Low controllability → Discard.
These add little value and can distract from real priorities.
This way, benchmarking becomes a filter for focus, not just a league table. It helps separate signal from noise, and turns external comparison into a structured tool for internal improvement.
👉 Which types of benchmark have been most useful in guiding action in your organisation?
November 2025
Being Right Isn’t the Same as
Being Useful.
Date:28.11.2025
Why Costing Teams Should Stop Chasing Waste and Start Telling Stories.
You can eliminate waste all day long - but if your costing outputs don’t tell a story, they won’t change a thing.
Costing isn’t about producing more reports. It’s about producing stories that explain how resources are used, how supply and demand connect, and where decisions can make the biggest difference.
Over this series, I’ve explored how waste creeps into costing teams:
- Reports no one reads.
- Analyses that don’t change decisions.
- Refinements that chase accuracy long after it stops adding value.
We looked at the Costing Team Value Matrix to separate quick wins from waste.
We explored practical moves - standardisation, automation, sequencing, abandonment, and feedback loops - that free up time and capacity.
But the point of all that effort isn’t efficiency for its own sake.
The point is to create space for costing to do what it’s really there for: to tell stories about resources that decision-makers can act on.
- Stories that reveal how capacity is really used.
- Stories that highlight mismatches between supply and demand.
- Stories that give clarity when the system feels chaotic.
Because in the end, costing isn’t just about numbers.
It’s about making sense of the system — and shaping better decisions.
We have a choice. We can continue to measure activity and produce reports that gather dust. Or we can step up and become storytellers of the system - bringing clarity, insight, and meaning to the way resources are used.
If we can do that, we won’t just be making costing more efficient.
We’ll be making it indispensable.
Date: 21.11.2025
Five Ways Costing Teams Can Reduce Waste and Create More Value
In my last post, I argued that costing teams don’t fail because they’re doing too little - they fail because they’re doing too much of the wrong things. Spotting waste is only the beginning. The next step is having a structured way to respond - so that effort is redirected, productivity improves, and the team consistently creates value for decision-makers.
One practical tool I use for this is a five-part framework that helps costing teams decide where to focus their energy. Each element follows the same rhythm: Identify → Act → Sustain.
Here’s how it works:
1. Standardise
Identify: Repetitive tasks done in slightly different ways across the team.
Act: Create shared templates, common assumptions, and consistent visuals.
Sustain: Keep a central library and update it as things evolve.
Result: fewer reinventions, faster turnaround, and outputs that feel consistent to your stakeholders.
2. Automate
Identify: High-frequency, rule-based tasks that consume time.
Act: Use scripts, schedules, and system features to build once and run many times.
Sustain: Check and refine automation regularly to ensure it stays relevant.
Result: more capacity released for insight and problem-solving.
3. Sequence
Identify: Bottlenecks and competing priorities that slow delivery.
Act: Prioritise by value vs effort, and phase the big jobs.
Sustain: Use a visible backlog so everyone knows what comes first.
Result: clarity of focus, less overwhelm, and smoother workflow.
4. Strategic Abandonment
Identify: Reports, analyses, or routines that aren’t influencing decisions.
Act: Stop, retire, or challenge them - even if “we’ve always done this.”
Sustain: Build in quarterly reviews to prevent “zombie tasks” creeping back.
Result: time saved and capacity redirected to higher-value work.
5. Feedback Loops
Identify: Outputs that don’t land with stakeholders.
Act: Ask whether the work helped - and what was missing.
Sustain: Make reflection part of the team’s cycle, not an afterthought.
Result: insights that are more relevant, more actionable, and more trusted.
This tool doesn’t prescribe where to start.
Think of it like a record - you drop the needle on the track that matters most right now. Some teams will begin with standardisation; others might find strategic abandonment the quickest win.
What matters is that the work costing teams put in actually translates into value for the organisation.
And that happens not by doing more, but by doing less of what doesn’t matter - so you can create more of what does.
Date: 14.11.2025
How Costing Teams Can Unlock More Value by Doing Less
Most costing teams I’ve worked with aren’t struggling because they’re doing too little - they’re struggling because they’re doing too much of the wrong things.
Time disappears into:
a) Reports no one uses.
b) Analyses that don’t change any decisions.
c) Endless tweaks for “perfection” that add no extra value.
The trick isn’t working harder. It’s redirecting effort to the things that create the most impact.
That’s why I like using our Costing Team Value Matrix - a simple way to rank every task by:
Value to decision-making (Low → High)
Effort to deliver (Low → High)
Here’s how it breaks down:
Quick Wins (High Value, Low Effort) – Prioritise these. They deliver immediate benefits with minimal time. E.g.
- Reusing an existing PLICS dataset to answer a service lead’s query.
- Sharing a one-page visual showing key cost drivers on a pathway.
Strategic Investments (High Value, High Effort) – Worth doing, but plan them carefully to avoid overloading the team. E.g.
- Building a model to assess the cost impact of a proposed new service model.
- Developing a costing approach that integrates activity, workforce, and estates data for system planning.
Fillers (Low Value, Low Effort) – Low priority, but can be done when capacity allows. E.g.
- Producing a quick ad-hoc report confirming a number someone already “knows.”
- Light-touch updates to routine packs that are used occasionally.
Waste (Low Value, High Effort) – Actively challenge or stop these tasks. E.g.
- Iterating cost allocations endlessly to chase theoretical accuracy.
- Producing detailed reports for committees that don’t use them in decision-making.
When you plot your team’s workload on this matrix, you quickly see where to focus, where to plan, and where to cut.
It’s not about “doing more with less.”
It’s about doing more of the right things - and less of everything else.
Date: 07.11.2025
Perfect PLICS. Wrong Channel. Zero Impact.
You can have accurate, timely, detailed costing data - but if it travels through the wrong channel, it still won’t make an impact.
Every costing channel sits somewhere on two scales:
Lean → Rich (how much context, conversation, and tailoring it offers)
Routine → Non-routine (how predictable or one-off the decision context is)
When the channel doesn’t match the situation, you get two common failure zones:
Overload Zone – Too much richness for a simple, routine decision.
Oversimple Zone – Too little richness for a complex, one-off decision.
Where Do Your Channels Sit?
Future channels could include LLM-powered assistants - instantly translating costing outputs into tailored briefings, but for now consider the main ways you deliver costing insight:
Reports
Bulletins
Systems
Workshops
BI tools
Operational meetings
Face-to-face conversations
Now ask: for each decision type you support, are you in the optimal part of the grid?
Four Hallmarks of High-Performing Channels
Timeliness – Does the insight arrive before the decision point?
Translation – Does it bridge finance and operational language?
Targeted Reach – Is it reaching people with authority to act?
Strategic Timing – Is it synchronised with moments when leaders are ready to decide?
Final Reflection
If every channel you use matched the complexity of the decision it serves, how much more of your costing work would directly shape organisational action?
October 2025
Supply Behaves. Demand Arrives.
Decisions Sit Between Them.
Date: 30.10.2025
In almost every NHS conversation right now, one word keeps coming up: productivity.
It’s a complex challenge. We all want to make the best possible use of our resources, but the reality on the ground is messy - demand fluctuates, staff availability changes, and services are often under pressure to deliver more with the same (or less).
Lately, I’ve been working alongside NHS colleagues to see how Plixology'ssupply and demand thinking can be applied to the productivity challenge we all face.. We’re right at the start of this work, but already the process is shifting how we think about the question of “how productive are we?”
The approach starts by looking at services through two equal lenses:
- Demand: the type, volume, and timing of who arrives at the service.
- Supply: the capacity, skills, and resources available to meet that demand.
When we put these side-by-side, we begin to see patterns and imbalances that aren’t always obvious when looking at demand alone. For example:
Periods where demand appears constant but the resource mix changes - affecting throughput in subtle ways.
Instances where the right resources are available, but not at the right time or in the right configuration to match the work arriving.
Services that appear “busy” but are operating below potential because of bottlenecks in just one part of the process.
Costing plays a crucial role here - not just as a reporting tool, but as a way of translating activity and resourcing into a shared operational story. That means taking the numbers and using them to answer real-world questions: Where are the constraints? What’s driving them? What could we do differently?
We’re not jumping to conclusions. This is exploratory, collaborative work, grounded in data but shaped by the operational reality colleagues live every day. The early signs are that this supply-and-demand lens can give us a much clearer, more actionable picture of productivity - one that goes beyond generic efficiency targets and instead focuses on how to use what we have to best effect.
It’s still early days, but the potential here is to create a shared framework for understanding productivity that works for both finance and operational teams. I’ll share more as the work develops - but for now, I’m encouraged by the clarity that’s starting to emerge when costing and operational insight are brought together in this way.
Date: 23.10.2025
Until Costing Models Reflect Reality, AI’s Just a Distraction
AI is coming up more and more in costing conversations. But too often, it’s disconnected from the real issues - like inconsistent resource mapping, misaligned operational logic, and the gap between how services are modelled and how they actually run on the ground.
So here’s the quieter, more specific question I’m asking:
What could AI actually do for costing teams - today, inside an NHS trust, with real data, real mess, and real constraints?
Because while AI won’t fix everything, it might help us see better. And in costing, that’s a big deal.
Think about it:
- Spotting Weaknesses in the Costing Model
AI could help identify which parts of the costing model are least stable - flagging areas with inconsistent mappings, overreliance on assumptions, or high sensitivity to small changes.
“This cost centre’s allocations swing significantly week to week - is it mapped too broadly?”
- Stress-Testing Assumptions Automatically
Instead of manually checking every rule or rate, AI could probe the model:
“What happens if we tweak this allocation logic?”
“Which assumptions drive the biggest change in staff cost per attendance?”
This turns the costing model into something dynamic and testable - not a fixed artefact.
- Learning Where the Model Doesn’t Reflect Reality
AI could highlight divergence between what the model says should happen and what actually does - for example, identifying where costed activity patterns don’t match known operational flows.
“Clinics with similar templates have wildly different indirect costs. Why?”
- Prioritising Where to Improve Data Quality
Instead of trying to clean everything, AI could help teams focus on the impactful data gaps - like the ones distorting high-volume areas or frequently referenced service lines.
“Theatre session data is missing in 18% of cases - but those cases account for 60% of ortho cost variation.”
- Exposing Fragile Linkages Between Systems
AI could map and monitor where costing logic breaks down across systems - such as where HR data doesn’t align with rostering or where coding patterns don’t reflect true acuity.
“Staff role codes in ESR don’t match actual deployment in 1 in 5 instances. That’s distorting hourly cost estimates.”
Because at the end of the day AI will only every be be as useful as the costing model it's embedded in.
If our models don’t reflect how care is actually delivered - with variation, judgement, and compromise - AI won’t add value. It’ll just scale the noise.
So maybe the most important role AI could play in costing right now…
is to hold up a mirror to the limits of our models.
Date: 16.10.2025
The Framework That Changed How I Think About Costing and PLICS
I’ve been sharing a few thoughts recently about costing, data, and the things we’ve seen work (or not) across NHS trusts.
Most of that comes from time spent shoulder-to-shoulder with teams - pulling apart costing models, making sense of data, and trying to turn PLICS into something that actually supports decisions, not just submissions.
After 20+ years and 30+ trusts, certain patterns kept coming up. Principles we returned to, again and again. Eventually, we gave them a name.
We call it Plixology.
It’s a framework - built from practice, not theory - for how costing can be more effective, more connected, and more influential in the day-to-day running of healthcare services.
It’s grounded in real-world delivery. But it’s also been shaped by our research beyond the NHS - learning from other industries where costing is seen as a strategic function, embedded in decision-making, not siloed in reporting.
That outside perspective keeps us honest - and helps push the conversation forward.
Plixology is about enriching PLICS with context and capability. It treats cost and information as equal parts of the story. And it supports continuous improvement, not just one-off analysis.
Many have now been introduced to the principles. Some are already applying them.
There’s no agenda here - just a desire to share what we’ve learned, and continue building on what works.
I'm always open to feedback but, if you've found these posts useful please comment, like and repost so that others can take something away too.
Plixology works!
Date: 03.10.25
The Power of a Story - and Why Most Costing Reports Don’t Tell One
Part 1
We all know the power of a good story. It cuts through. It sticks. It moves people to act.
But most costing outputs - especially in the world of PLICS - aren’t stories.
They’re data dumps. Accurate, detailed… and largely ignored.
Because here’s the truth: facts alone don’t change behaviour - stories do.
That’s where costing teams can make the shift:
- From presenting numbers to explaining why they matter
- From being right to being effective
- From producing data to delivering insight
It’s not about dumbing things down. It’s about making them resonate.
A story has a focus (what’s changing?), tension (where’s the problem?), and resolution (what could we do next?). Good costing work has all of that - it just needs framing.
So maybe the most powerful thing a costing team can do with PLICS…
is to learn how to tell better stories with it.
Date: 06.10.25
The Power of a Story - and Why Most Costing Reports Don’t Tell One
Part 2
In costing, we often talk about patients as the centre of the model - and rightly so. But when it comes to solving problems, it’s the resources that do the work.
They’re the ones we plan around, schedule, stretch, and substitute when demand surges.
And yet in many costing models - especially in PLICS - resources appear as background noise. Their availability, cost, and variation are flattened out into averages or buried in high-level categories.
But here’s the thing:
If you want to understand why something costs what it does, or what could be done differently, you have to put resources at the centre of the story.
- A nurse isn’t just a cost per minute - they’re the person deciding whether a patient is seen now or waits 45 minutes.
- A radiographer isn’t just an input to a tariff - they’re the bottleneck or the enabler of flow.
- A shift pattern isn’t just a rota - it’s the script for how the next 12 hours unfold.
When we understand cost through the lens of the resources we "supplied", when they were available, at what cost, and with what impact, the story changes.
It’s no longer just about how much the patient “demanded.”
It becomes about how we responded, with what resourcing decisions - and whether that made the system stronger or more fragile.
Costing teams have the data to tell this story.
We just need to start casting the right characters in the leading roles.
September 2025
What Would Costing Look Like If It
Started with Decisions?
Date: 25.09.2025
It’s not about being right. It’s about being effective.
As a costing team, accuracy matters to us - a lot. We care about the definitions, the mapping rules, the minutes, the cost centres. We want the data to be correct, consistent, and audit-proof.
But here’s the thing: being right doesn’t always lead to change.
And costing - if it’s going to make a difference - needs to be more than correct. It needs to be useful.
A perfectly reconciled cost report that no one understands, trusts, or uses… doesn’t move the needle.
A marginally less “accurate” view that highlights an operational issue in real time? That might actually change behaviour.
So maybe the role of PLICS isn’t to defend the truth, but to help people act.
That means:
- Cost models that reflect the decisions staff actually make
- Data that’s accessible, not just accurate,
- Insight that supports action, not just reporting
This doesn't mean accuracy doesn’t matter - it absolutely does. But if costing is going to support real improvement in the NHS, we have to balance precision with purpose.
Because the goal isn’t just to be right about the numbers.
It’s to be effective in the system we serve.
Date: 17.09.25
“We’d use PLICS more… if only it worked better.”
It’s a line we hear across the NHS. But more often than not, the issue isn’t that PLICS doesn’t work - it’s that it’s stuck behind barriers we’ve learned to live with.
Let’s be honest:
- It’s hard to implement consistently.
- The data’s messy.
- The system’s complex.
- Capacity is thin.
- Staff are wary to engage.
- And even when we do get the data right, it doesn’t always link back to what the system values financially.
But here’s the shift we need to make as costing teams:
What if these aren’t just problems to fix... but clues to what matters most?
Inconsistent implementation?
That’s not just a tech issue - it’s a signal that we need stronger operational support and clearer ownership of the data journey.
Complex cost structures?
That’s healthcare - layered, human, unpredictable. If anything, it shows why a richer, more adaptable costing model is exactly what we need.
Limited resources?
Yes, costing takes time. But the insight it can offer - especially when matched with operational variation - might be the key to unlocking some of that very capacity.
Low engagement?
That’s often a reflection problem, not a people problem. If the costing model doesn’t reflect reality, why would anyone engage with it?
Disconnect from financial outcomes?
Maybe it’s time we flipped the model - and used costing not just to track spend, but to inform where funding should flow next.
The challenges are real. But they’re also deeply human, and deeply systemic. That means they won’t be solved by better spreadsheets alone.
It’s going to take clearer models, better conversations, and the courage to build something that reflects how care actually works.
Date: 10.09.2025
The Costs We Count - and the Ones We Don’t
Do we actually know what’s driving cost in our hospitals? We often think we do. The data is certainly detailed - we can break costs down by patient, attendance, clinic. But when we really stop and look… are we costing what matters?
Take an A&E nurse working a late shift. If demand spikes at 7pm and the department is overwhelmed, that cost shows up in wait times, delayed care, and potentially avoidable admissions - but none of that is visible in a PLICS dashboard.
Or consider two clinics with the same number of attendances, but in one of them we rely heavily on agency cover. Same activity, very different cost base. Do we see that? And if we do, are we using it to support better decisions?
And then there’s staff mix, shift overlap, resource strain - all of which are real cost drivers, yet barely register in traditional PLICS models.
So the question I'm asking is this:
Are we costing inputs that clinicians and managers can control, or are we just reporting outputs they can only react to?
Because if we want to support better decisions, maybe our costing needs to shift from reporting what happened, to helping teams understand why it happened - and what it cost them to respond the way they did.
Date: 03.09.2025
Is NHS costing solving the right problem? Or are we missing the levers we can actually pull?
We’ve spent years refining PLICS (Patient Level Information and Costing System). We’ve produced more data than ever - millions of lines, mapped to patients, attendances, and incidents etc. But despite all this, frontline services continue to struggle. Waiting times are rising. Resources are stretched. And we have to ask: is costing actually helping the people who need it most - our clinical and operational teams?
The truth is, traditional costing models focus almost entirely on patient demand. But clinicians and managers have little control over how many people walk through the door. What they do control is the supply of care: how staff are deployed, when shifts change, what resources are available at what times. Yet our models barely touch this.
We’ve come to realise that cost isn’t “caused” by the patient - it’s the result of resourcing decisions we make to meet that demand. If we want costing to be useful - to truly support better care - it has to reflect both sides of the equation.
This means shifting from a narrow, tariff-driven view of activity, to a model that captures operational variation, real-world utilisation, and the dynamics between supply and demand. Only then can we start answering questions like:
Where is pressure building during the day?
Are we staffing to meet actual patterns of need?
What opportunities exist to improve productivity without compromising care?
The data is already there. What we need is a model that helps teams use it to drive change - not just reporting.
This shift won’t be easy. But it’s the direction we need to go if we’re going to turn PLICS from a regulatory obligation into a real strategic asset.
August 2025
If Costing Is Going to Matter,
It Has to Move Closer to the Front Line.
Date: 26.08.2025
Back to School. Back to PLICS.
Part 1
September is a false comfort zone.
The inbox fills up. The routine restarts. We slip back into the cycle of “produce the PLICS, publish the PLICS, park the PLICS.”
But here’s the uncomfortable truth: if we do PLICS this autumn exactly as we did last year, the outcome will be the same. The reports will be accurate, but they won’t change behaviour. The insight will exist, but it won’t be used.
September shouldn’t be a restart. It should be a reboot.
And that starts with four hard questions:
WHY – What story are we telling? If PLICS doesn’t land as a narrative about resources, trade-offs and choices, it won’t drive action.
WHO – Who really needs this? Not the regulator, not finance alone — but clinicians, service managers, execs. If we don’t re-engage them now, we’ve missed our window.
WHAT – What one thing will we do differently this year? If you can’t point to a change - in process, in presentation, in relationships - then it’s business-as-usual in disguise.
HOW – What practical step will we take this month to make it real? A workshop? A new way of presenting data? A sharper story for the board? If not now, then when?
September isn’t about picking up where we left off.
It’s about daring to approach PLICS as if it could be something more.
Because the real risk isn’t getting the numbers wrong.
It’s getting them right - and making no difference.
So, what’s your one bold step to reboot PLICS this autumn?
Data: 29.08.2026
Is Costing Jargon Killing Your Message?
Part 2
Costing teams are fluent in numbers.
But the people we want to influence - clinicians, managers, execs - don’t always hear them.
That’s why language matters. Not the accuracy of the data, but the way we describe it.
Take a few examples:
Fixed costs → What we can’t flex
Marginal costs → What changes when demand changes
Length of stay → Beds tied up
Cost drivers → Levers we can pull
These aren’t the “right” answers. They’re just illustrations of how technical terms can be reframed into something people use and remember.
The real opportunity is for each trust to create its own consistent vocabulary. One that resonates locally, is reinforced across reports and conversations, and becomes familiar enough to stick.
And it shouldn’t stop at words. Consistency of themes, tone, imagery, even branding all play their part in building credibility. Over time, this becomes the identity of costing - recognisable, trusted, and acted upon.
Because the challenge in PLICS isn’t just accuracy.
It’s whether people understand it, trust it, and use it.
- If your team had to define a costing “dialect” that everyone could recognise - what would it sound like?
Date 30.08.2025
The Deadline Costing Teams Can’t Afford to Miss
Part 3
For too long, PLICS has been treated as compliance. Reports produced, numbers accurate, deadlines met. Necessary, but not enough.
A reset creates the opportunity to use costing differently. To build credibility and influence by showing cost as:
Narrative – a clear story about resources, choices, and trade-offs.
Lever – evidence of where small shifts can drive meaningful impact.
Resilience – insight into how services hold under pressure, and where they bend.
But this doesn’t happen overnight. It requires a steady, deliberate plan:
September - October: reset and engage:
Agree priorities, pilot new ways of presenting insight, gather feedback.
November - December: focus and share:
Go deep on one priority, package the story consistently, test it with leaders.
January - March: scale and influence:
Expand into new areas, integrate into planning cycles, and evidence the changes PLICS has helped drive.
That’s the real prize by March: costing that is consistent, trusted, and used as part of decision-making.
This is where the Plixology approach comes in - helping teams shift PLICS from data for compliance to stories that drive action.
By March, will your costing work be another report delivered, or a narrative people rely on?
Lets start the conversation
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