NHS England’s month nine financial performance report highlights the difficult position faced by CCG’s1. NHS England estimates the CCG sector will overspend by £291 million by year-end, despite a large increase in planned efficiencies for 2017/2018.
Savings of £3.1 billion (3.9% of allocation) for CCGs were originally planned in 2017/2018. At December 2017, savings are forecast to be £2.5bn (3.1% of allocation and 81% of planned). Although this is now less than planned (81% of plan) this is still 26% larger than that achieved in 2016/17.
In discussions with CCGs, it is clear a range of issues impact their financial positions such as difficulties in obtaining cheaper versions of drugs - with the most important being slippage of their often very ambitious savings plans.
Future funding
The Autumn Budget went some way to plugging an NHS funding gap of £4 billion in 2018/2019 by committing an additional £2.8 billion for the NHS in England - £335 million in 2017/2018, £1.6 billion in 2018/19 and the balance in 2019/2020. Although welcomed, this falls short of the level of investment needed to meet the current demand for NHS services.
So what can be done? In the main, service transformation is seen as the best way to increase efficiencies and deliver services within budget. This can involve the redesign and closer integration of patient pathways (sometimes with social care), reducing clinical variation, and reducing procedures with limited clinical value.
The future provision of GP services
The provision of primary care services faces many challenges, including recruitment, CQC inspections and increased demand primarily caused by an ageing population with increased co-occurring diseases. As a result, many GP practices and CCGs are considering whether their current structures are appropriate and there is more interest in new models of working across boundaries, such as multi-specialty community providers and GP super companies as well as the vertical integration of GP practices.
Governance
As CCGs and their partners develop new care models, concerns have been raised about the governance of new working methods. Many relate to responsibilities that sit between the different organisations involved.
As integration take place across other areas, CCG Audit Committees should consider how they develop their new relationships to ensure integrated commissioning arrangements are properly considered by all parties. In particular issues including risk management, conflicts of interest and fraud prevention controls.
General Data Protection Regulation
The GDPR comes into effect in the UK on 25 May 2018, replacing the current Data Protection Act 1998 (DPA). It will apply to all UK public sector bodies, including the NHS.
Based on the same basic principles as the UK’s current data protection law, the new framework includes some significant changes and provides a more comprehensive system for the governance of information – from the point of data collection to its final deletion. Organisations are required to have a governance system in place to demonstrate their compliance and to show the regulator – the Information Commissioner’s Office – that they are taking data protection seriously. Those who fail to comply with GDPR could be subject to far larger fines than under the DPA.
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Supporting the development of contracting
The guidance published in February ‘Refreshing NHS Plans for 2018/19’ emphasises the need for a collaborative approach to care delivery2. But there continues to be significant contractual challenges between commissioners and providers. Contracting parties should consider:
- the range and complexity of contracting models in use and how a more collaborative approach can be taken
- common contractual issues such as HRG4+, specialist commissioning and electronic patient record implementations
- the accuracy of how healthcare data is coded, recorded and classified.
Procurement
Given the continuing pressures on NHS finances, CCGs are looking at different ways to deliver and procure services - many of which are driven by the STPs. Some of these methods are relatively new to large parts of the NHS. However, regardless of how CCGs procure, it is essential to comply with the relevant regulations to help minimise the risk of subsequent legal claims.
CCG Mergers
Across England there is a growing appetite for formal CCG mergers. Several, eg in Birmingham and around Bristol, have now had merger applications approved. The vast majority of other CCGs have already set up shared management teams and innovative structures to help tackle the issues they face and many are now considering whether to apply to merge formally. Some have also moved to formal collaboration arrangements with local government.
Shared management structures have many advantages, including greater capacity and resilience, economies of scale and an enhanced skills base. However, achieving effective joint working will not be easy. Regardless of the method chosen, key issues to consider include governance structures as well as people and culture issues.
To discuss the CCG sector and the issues impacting it, please contact Mark Stocks.
References
- NHS England – Board Paper, NHS England, 8 February 2018
- Refreshing NHS Plans, NHS England and NHS Improvement, 2 February 2018
