Commissioning - Health Committee Contents


The structure of specialist commissioning

43. Although services in the NHS are commissioned by PCTs, there are particular arrangements for commissioning specialised services. Specialised commissioning seeks to ensure that the needs of those with rare diseases, or who require specialised services not available in all local hospitals, are met effectively. Examples of such services include heart, lung and liver transplants, children's heart surgery and neurosurgery, specialised burn care and the treatment of illnesses such as severe immune deficiency or rare neuromuscular disease.[31] These services are often expensive and unpredictable so PCTs have come together to commission such services collectively and thereby share the financial risk. These services are often best provided in a small number of regional specialist centres so doctors and nurses can develop their skills by seeing as many such patients as possible.

44. Following the Carter Review[32] (see Box 3 below) in 2006 these services are commissioned in the following ways, as the National Specialised Commissioning Group informed us:

    The National Specialised Commissioning Group has responsibility for overseeing specialised commissioning in England. It facilitates collaborative working between the Specialised Commissioning Groups, for example through national programmes such as the national paediatric cardiac surgery and paediatric neurosurgery programmes, which are currently underway. It also oversees the national commissioning function. Its voting members are 10 PCT Chief Executives representing the 10 regional Specialised Commissioning Groups.

    The 10 Specialised Commissioning Groups in England, coterminous with the 10 Strategic Health Authorities, commission services on behalf of their constituent PCTs. They plan and commission those services from within the Specialised Services National Definitions Set that their PCTs direct them to commission. Together they have an annual budget of about £4.5 billion; approximately 5% of NHS spend. This does not represent all spending on specialised services as some services continue to be commissioned locally by PCTs. The Strategic Health Authorities are responsible for the performance management of the Specialised Commissioning Group in their region.

    The National Commissioning Group is a standing sub committee of the NSCG. It is predominantly a clinical group and commissions over 50 services nationally for England (and in some cases for Wales, Northern Ireland and Scotland) with an annual budget of about £480 million.

    The National Specialised Commissioning Team commissions services on behalf of the National Commissioning Group and supports the work of the National Specialised Commissioning Group, such as the national paediatric cardiac surgery and paediatric neurosurgery programmes. The Team also helps facilitate collaborative working between the Specialised Commissioning Groups.[33]

Figure 1 below shows the accountability arrangements of the National Specialised Commissioning Group.


Box 3: The Carter Review, May 2006

The genesis of the Carter Review was the recognition that PCTs were not collaborating effectively in the specialised arena to the potential detriment of people in need of specialised care. The need for collaboration hinges on optimizing the development and use of clinical resources for relatively smaller patient populations for whom the NHS is also uniquely well placed to share financial risk. The Carter Review was commissioned by the DH to help the NHS plan provision for some of the rarest conditions and expensive treatments, investigate how the NHS commissions specialised services and make proposals for improvement.

The Review recommended a number of changes to ensure the commissioning process was "robust and fair, understood by all, engaged patients and offers value for money". One of the key recommendations of the Carter Review was the creation of the National Specialised Commissioning Group (NSCG), to co-ordinate the commissioning of specialised services, the National Commissioning Group, and of 10 regional Specialised Commissioning Groups, one for each SHA. Carter laid down that services should be funded through budgets pooled between constituent PCTs in each SCG on the basis of weighted capitation. There was also to be a review of the Specialised Services National Definitions Set.[35],[36]

45. The National Definitions Set contains a list of 35 services which SCGs are supposed to commission.

Box 4: Specialised Services National Definitions Set

There are 35 specialised service definitions covered by the Specialised Services National Definitions Set.[37] The second edition of the Specialised Services National Definitions Set (SSNDS) was completed in December 2002. The third edition is being created during 2009-10.

The purpose of a definition is to identify the activity that should be regarded as specialised and therefore within the remit of PCT collaborative commissioning. A service is specialised if the planning population (i.e. catchment area) for that service is greater than one million people. This means that a specialised service would not be provided by every hospital in England; generally, it would be provided by less than 50 hospitals.

Each definition is drawn up by an iterative process involving providers (clinicians, hospital managers, and information and coding staff), commissioners, patients' groups and the Department of Health. It is then endorsed by the relevant national organisations, signed off by the National Specialised Commissioning Group (NSCG) and published on the NSCG website.

Criticisms of specialised commissioning

46. It seems to be widely acknowledged that the implementation of the Carter Review has had a significantly positive effect on the commissioning of specialised services. The creation of SCGs in particular has been welcomed as a step forward and we received encouraging evidence on the work of some of these,[38] as well as that of a supra-regional consortium of SCGs.[39] However, we were told that progress in implementing the Carter Review is slow and patchy, meaning that there is significant inconsistency between different parts of the country.[40] In addition, some witnesses thought that the Carter Review had left some substantial issues unaddressed.

47. We heard that, while the revision of the National Definitions Set is welcome, many still regard it as too rigid in defining a specialised service as one "with a planning population of more than one million people".[41] Deborah Evans, Chair of the South West SCG, told us:

    there are lots of things that have come under the definition set we now regard as matters that PCTs can and would expect to commission within their normal pathways.[42]

She cited as examples cardiology and cardiac surgery, and child and adolescent mental health services, in both of which cases SCGs were only involved in commissioning "the very complex end" of service provision. Getting the right "dynamic […] between the PCT and specialised levels" was particularly important in creating better care pathways for people with chronic conditions, helping to join specialised commissioning at the local level with other services, including social care.[43]

48. The most important criticism of the Carter Review which we heard was that it had not gone far enough in strengthening specialised commissioning. We were told that, while the creation of SCGs and the NCG had reinforced specialised commissioning, they were hobbled by the fact that PCTs still retained ultimate responsibility for specialised commissioning and control of the purse strings. The Specialised Healthcare Alliance told us:

    Carter depends on the willingness of PCTs to share sovereignty and resources in a way which is counter to their instincts and the rhetoric of localism.[44]

According to the Alliance, PCTs were often reluctant to pool risk properly, by combining funding with other PCTs on a weighted capitation basis.[45]

49. We were informed that SCGs had no authority over PCTs, since the former were actually sub-committees of the latter. This means that SCGs have no power to oblige PCTs to participate in collective commissioning, or to make them commission services locally when they are not commissioned at the regional level.[46] Mr Murray, the Director of the Alliance, told us about lack of attendance by PCT Chief Executives at SCG meetings, indicating that the PCTs concerned were treating specialised commissioning as a low priority.[47]

50. The Alliance further told us that the status of SCGs meant that they existed in a kind of "limbo", unable to be subjected to regulation, performance management, scrutiny and accountability in the way that PCTs were.[48] This meant, for instance, that while the DH had developed a "World Class Specialised Commissioning" programme for SCGs, this was not mandatory in the way that WCC was for PCTs.[49]

51. The Alliance voiced the fear that, during the impending period of financial restraint, PCTs would "look to protect local services in the downturn to the detriment of clinically and cost effective specialised care", something which SCGs would be powerless to prevent.[50]

52. Accordingly, the Alliance argued strongly in favour of making SCGs commissioners in their own right, channelling funds directly to them instead of giving them to PCTs and locating them at SHA level (rather than being hosted by a PCT). The Alliance also made the same argument in respect of the NCG, arguing that it should be funded directly (rather than through top-slicing of PCTs, as at present) and performance managed by the DH, with Ministers continuing to be involved in decisions about service provision.[51]

53. However, Ms Evans told us that this would cut across patient pathways and could damage the quality of care:

    I do not believe it is in the interests of patients to take all the money to do with specialised commissioning away from PCTs and put it with another body […] the challenge but also the strength of PCTs is that they look after a whole population and look across a whole pathway. I do not think it makes sense to take the very specialised end of, say, renal services and give it to another body and then say that all the other aspects of renal services, like looking after people in primary care, early detection of disease and end-of-life care, should be put elsewhere […] The best interests of patients are for us to make the dynamic between PCT commissioning and SCG commissioning work. Rather than give up on it we should make it work better and that is in the interests of patients.[52]


54. The implementation of the Carter Review has made significant improvements to the commissioning of specialised services over the past four years. However, we are concerned that insufficient progress has been made, with significant local variations; and that some important issues remain outstanding.

55. Carter recommended the revision of the National Definitions Set; this does not appear to have gone far enough. The DH must indicate what it will do to ensure that the fourth edition commands wider confidence and support among commissioners.

56. Worryingly, the evidence which we received indicates that many PCTs are still disengaged from specialised commissioning. Furthermore, there is a danger that the low priority many PCTs give to it will mean that funding for specialised commissioning will be disproportionately cut in the coming period of financial restraint. In addition, specialised commissioning is weakened by the fact that, as a pooled responsibility between PCTs, it sits in a "limbo", where it is not properly regulated, performance managed, scrutinised or held to account. There is much to commend the Specialised Healthcare Alliance's proposal to bypass the PCTs altogether, making the National Commissioning Group and the Specialised Commissioning Groups into commissioners in their own right, although there is some risk that this could lead to a lack of co-ordination of, and disruption to, services. We recommend that the DH undertake a review of the problems we have highlighted, taking into account the Specialised Healthcare Alliance's proposal.

31   Ev 182 and Back

32   Review of Commissioning Arrangements for Specialised Services. Independent Review requested by the Department of Health, May 2006 Back

33   Ev 182 Back

34   Ev 183 Back

35   The third edition of the National Definitions Set is being released in spring 2010. Back

36 Back

37 Back

38   Ev 149-151, 262-263 Back

39   Ev 151-154 Back

40   Ev 272, 299 Back

41   Ev 108 Back

42   Q 253 Back

43   Q 259; cf. Ev 35, 75, 197 Back

44   Ev 271 Back

45   Ev 272, 274 Back

46   Ev 145, 258 Back

47   Q 261 Back

48   Ev 273; cf. Ev 146 Back

49   Ev 144, 274; Qq 256-258 Back

50   Ev 272 Back

51   Ev 271, 274; cf. Q 267 Back

52   Q 254 Back

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