Written evidence from The King's Fund
(COM 118)
1. The King's Fund is a charity that seeks
to understand how the health system in England can be improved.
Using that insight, we help to shape policy, transform services
and bring about behaviour change. Our work includes research,
analysis, leadership development and service improvement. We also
offer a wide range of resources to help everyone working in health
to share knowledge, learning and ideas.
SUMMARY
2. The previous Health Committee strongly
criticised the current commissioning regime, concluding that,
unless it is able to demonstrate better value for money, the purchaser/provider
split may need to be abolished. It highlighted a number of weaknesses
including:
— PCTs remain largely passive commissioners
and do not challenge providers sufficiently regarding the quality
and efficiency of their services.
— PCTs lack essential data analytic skills,
clinical knowledge and high quality managerial talent.
— The skills deficit in PCTs has been worsened
by "constant reorganisations and high turnover of staff".
3. Since the publication of the Committee's
report, the latest world class commissioning assessments have
been made available and we have published new research focusing
on the use of external support for commissioning by PCTs. Both
highlight marked improvements in the quality of commissioning
over the last year, although many of the weaknesses identified
by the Committee remain.
4. The new Government's White Paper Equity
and Excellence: Liberating the NHS proposes to replace the
current arrangements with a new system of GP commissioning, abolishing
PCTs by 2013. Our evidence to this inquiry draws on our response
to the White Paper to make the following key points:
— Giving budgets to GPs provides a significant
opportunity to improve commissioning in the NHS. However, the
government's approach risks undermining the benefits it could
bring. We recommend a more measured approach that enables those
who are ready to pilot the new arrangements to do so, with the
learning used to support a flexible, staged national roll out
that enables consortia to take on increasing responsibilities
as and when they are ready to do so.
— Although we do not endorse abolishing
the purchaser/provider split, there is a strong argument for sticking
less rigidly to a separation of the two functions. The needs of
some patients, for example older people and people with long-term
conditions, may be better met by organisations which bring together
commissioning and some or all aspects of provision. Now is the
time for policy-makers to explore the role that such integrated
systems could play in the NHS.
— While we acknowledge the case for some
reform, we question the need to embark on a fundamental reorganisation
of the NHS at this time. Streamlining NHS structures over time
as the new commissioning arrangements are implemented, rather
than abolishing all PCTs and SHAs by a set date, would ease the
transition and minimise instability as the NHS also confronts
the most significant financial challenge in its history.
— It will be vital that the consortia include
a range of clinicians and professionals as well as GPs.
— While we welcome the enhanced role that
local authorities will play under the government's proposals,
the relationships between the National Commissioning Board, local
Health and Well-being Boards and GP commissioning consortia need
to be clarified. The loss of co-terminosity between local authorities
and commissioners risks undermining collaborative working.
— An overly restrictive management allowance
could make it difficult for consortia to build or buy in the range
of skills they will need to commission effectively.
— More thought needs to be given to how
consortia will collaborate to commission specialist services that
cannot be effectively commissioned by individual consortia. Allowing
this to happen organically may not be sufficient.
CLINICAL ENGAGEMENT
IN COMMISSIONING
5. Limited use of clinical expertise remains
a key weakness in commissioning. Practice-based commissioning
(PBC) has not succeeded in securing sufficient clinical engagement,
in part because the incentives to engage are weak, and in part
because many GPs feel it does not give them enough power or control
over commissioning decisions (Curry et al 2008). Devolving power
down to consortia level and replacing the notional commissioning
budgets used in PBC with real budgets can be expected to improve
this.
6. The evidence from clinical commissioning
groups in other countries, particularly the USA, makes it clear
that involving doctors from a range of specialties, not solely
GPs, is crucially important for success (Ham 2010a). Engaging
other professionals such as nurses, pharmacists and social care
professionals is also important. With real multi-disciplinary
involvement, commissioning consortia can become the focus for
improved collaboration and closer working between services and
professionals. If, however, commissioning is seen principally
as the prerogative of GPs, there is a risk of it widening historic
divisions between different parts of the health service, and in
particular between primary and secondary care.
7. The government's intention to make membership
of commissioning consortia mandatory will go some way to encouraging
a minimum level of clinical engagement in commissioning. However,
it will also be important for GPs and other professionals to feel
they have ownership of these new organisations. The government
will need to develop a clear operational policy on how GP consortia
will work with their constituent GP practices to ensure due process
and transparent decision-making. Rules governing conflicts of
interest should not, however, become a rigid barrier which prevents
consortia from commissioning services from their constituent practices.
This would risk making it difficult for GPs to use their commissioning
powers to develop new services in primary care, which for many
GPs is likely to be one of the main attractions of engaging with
commissioning.
IMPLEMENTING THE
PROPOSED REFORMS
8. The research evidence suggests that clinical
commissioning is most successful when the scope of services commissioned
is adjusted according to the size and skills of each commissioning
group (Ham 2010a). We do not, therefore, endorse the proposed
single model for GP commissioning, in which all consortia bear
full risk for commissioning a near comprehensive range of services,
as described in the Government's White Paper (DH 2010).
9. However, if this approach is implemented,
we urge the Government to adopt a more flexible, staged process
in which consortia are not exposed to full budgetary risk in the
first years of their existence, and only take this on as and when
they are ready for it. Experience from other countries suggests
that a gradual transfer of budgetary responsibility is required
as GP commissioners learn how to manage budgets effectively. This
would allow (a) some consortia to take on responsibilities before
others, and (b) responsibilities to be transferred incrementally
rather than transferring full financial risk from the outset.
The NHS Commissioning Board could have the power to limit windfall
gains or unavoidable losses during this period, or until there
is general confidence in the accuracy of the formula used to allocate
resources between consortia.
10. The readiness to take on greater responsibilities
for commissioning currently varies markedly between different
groups of GPs. Some practice-based commissioning groups are ready
to make a start as soon as possible. Supporting them to be early
adopters by using 2011-12 as a shadow year for introducing GP
commissioning would enable testing and evaluation to take place
to inform national implementation.
11. Building the necessary capabilities
within consortia will be a key challenge in implementing the proposed
reforms. Commissioning is a complex and multi-faceted task, and
doing it effectively requires a broad range of skills. These range
from very specific, technical skills (eg data analysis and interpretation)
to more generic but no less important skills in leadership and
management (eg influencing, negotiation and relationship management).
Highly specialist skills are also needed in areas such as accountancy
and contract management.
12. While it will not be necessary for consortia
to develop all these skills internally, they will as a minimum
need to quickly develop a clear understanding of the different
elements of high quality commissioning, and the support they may
need in order to do it effectively. They will also need strong
leadership and communication skills, in order to establish an
effective dialogue with colleagues in primary and secondary care
about quality and productivity, and to influence professionals
who are not directly accountable to them.
13. Other, more technical skills may be
bought in or built over time by working with commissioners in
PCTs and local authorities, or with private sector companies offering
commissioning support services. Our research found that while
external support can help improve commissioning processes, PCTs
have not always been effective users of the services available
(Naylor & Goodwin 2010). GP consortia will not necessarily
have experience of using external support and are likely to be
operating with more restrictive management allowances. They will
therefore need to learn from PCTs' experience of using external
support to avoid repeating past mistakes.
14. If management allowances are too restrictive,
there is some risk that consortia will not be able to either buy
in the skills they need or build them in-house.
15. The results of the 2010 world class
commissioning assessment process indicate that commissioning skills
within some PCTs have improved considerably since 2009 (Gainsbury
et al 2010). An immediate priority must be to support existing
commissioning and managerial talent in PCTs, SHAs and elsewhere
during the transition period, to prevent the accumulated knowledge
and skills from being lost. If the rapid changes currently being
seen in PCTs continue and lead to a major scaling back in their
activities before consortia are fully operational, there is a
serious risk of losing financial control in the interim period.
ACCOUNTABILITY ARRANGEMENTS
FOR GP COMMISSIONING
16. The White Paper proposes that GP consortia
are held accountable by the NHS Commissioning Board (NCB), using
a commissioning outcomes framework. The NCB will have a very wide-ranging
remit, including calculating how resources will be allocated between
consortia, holding them to account, developing commissioning guidelines
and model contracts, and directly commissioning services not commissioned
by consortia. Despite the intention set out in the White Paper
for it to be a "lean and expert body", the NCB is likely
to need a substantial workforce and a presence at the regional
level, to discharge these varied responsibilities effectively.
17. The proposed framework focuses principally
on the outcomes consortia will be expected to achieve for the
population they serve. We are concerned that focusing just on
outcomes will leave the NCB poorly equipped to assess the performance
of consortia, since outcomes measures used in isolation can be
insensitive to difference, slow to detect change over time, and
will be influenced by multiple external factors beyond the consortia's
control. While we would not advocate the creation of an assessment
process as burdensome as world class commissioning for GP consortia,
we believe the NCB should complement outcome measurement by also
assessing consortia in terms of a small number of essential commissioning
processes or competencies, particularly during the first years
while consortia are still developing their skills.
18. Particular accountability arrangements
should be put in place with regard to the use of external support.
If some consortia choose to outsource their responsibilities and
transfer the financial risks involved in commissioning onto private
sector organisations, arrangements will be required to safeguard
public accountability and ensure the organisations involved are
capable of taking on these risks.
INTEGRATION AND
THE ROLE
OF LOCAL
AUTHORITIES
19. Local authorities will be given a number
of new roles under the proposed reforms. In addition to taking
on responsibility for commissioning public health services, new
Health and Well-being Boards will be established with responsibility
for:
— co-ordinating and integrating the commissioning
of health and social care services;
— assessing population health needs and
leading, or at least overseeing, health improvement activities;
and
— scrutinising consortia's plans for service
redesign.
20. Transferring public health commissioning
to local authorities creates a welcome opportunity to integrate
the planning of public health interventions with decision-making
around broader factors that influence population health, such
as education, housing and transport. However, it is important
that the NHS remains closely involved in health improvement and
prevention, and that the many opportunities that exist for health
professionals to promote health and wellbeing are not lost. Further
thinking is needed on how responsibilities in this area will be
divided between consortia, local authorities and the new Public
Health Service.
21. GP commissioners will have a central
role in developing integrated models of care which span organisational
boundaries. The case for collaboration in the delivery of high-quality
care for people with long-term conditions and for older people
who have complex co-morbidities is compelling. Many of these people
are frequent users of NHS and social care services who could be
supported to live independently if primary care teams worked more
effectively with specialist teams based in hospitals. Integrated
service provision has the potential to deliver more care closer
to home and avoid the inappropriate use of hospitals as is already
being demonstrated in areas like Torbay, with emerging evidence
suggesting that working in this way also delivers savings to the
NHS (Ham 2010b; Ham & Smith 2010). Given the severe pressure
on health and social care budgets over the next few years, it
will be essential that NHS organisations and local authorities
do more to work together to pool resources and align services
in this way.
22. The impact of the reforms on the integration
of health and social care may depend largely on the interface
between Health and Well-being Boards and GP consortia. This is
currently unclear and it remains to be seen whether Health and
Well-being Boards will have any real power over consortia's decisions.
If the Boards do not have formal powers with regard to GP consortia's
commissioning decisions, their role in integrating the provision
of health and social care may be limited. If, on the other hand,
they do have statutory powers, this would create a dual chain
of accountability for consortia, with tensions potentially arising
between the demands of local Health and Wellbeing Boards on the
one hand and the national NHS Commissioning Board on the other.
23. One serious concern is that the loss
of the geographical co-terminosity that currently exists between
PCTs and local authorities may make collaborative working considerably
more difficult. Although the shape consortia will take is as yet
undetermined, some are likely to straddle local authority boundaries,
and many local authorities will need to forge relationships with
multiple consortia. In addition to challenges regarding relationship-building,
the loss of co-terminosity introduces significant practical barriers
resulting from having different local partners working with data
flows and commissioning plans which cannot be aligned in terms
of their geographical coverage. The impact of this would be heightened
further if consortia are formed on the basis of affinity rather
than geography.
24. To facilitate the development of integrated
models of provision, policy makers should avoid sticking rigidly
to a separation of commissioning and provision. GP commissioners
must be supported in developing services that overcome barriers
between primary and secondary care, between health and social
care and between practices themselves. Regulations concerning
conflicts of interest arising from being both a provider and commissioner
should ensure transparency in decision-making without preventing
GPs and other professionals from innovating in this way.
HEALTH INEQUALITIES
25. Tackling the stark and avoidable inequalities
in health that exist between different groups and areas of the
country requires a cultural change in which GP commissioners accept
greater responsibility for protecting and promoting population
health as well as for the immediate needs of individual patients.
It is important that the commissioning outcomes framework includes
strong incentives for GP consortia regarding health improvement
and the reduction of health inequalities.
26. The interface between consortia and
local authorities will again be critical for delivering on this
agenda. Consortia will need to build close relationships with
local authorities and the new Public Health Service in order to
work collaboratively on tackling health inequalities.
SPECIALISED COMMISSIONING
27. The previous Committee's report on commissioning
identified particular issues regarding the commissioning of specialised
services, with many PCTs giving this low priority and wide variations
existing between local areas. Under the new proposals, the most
highly specialised services will be commissioned by the NCB rather
than by GP consortia. Securing the necessary clinical engagement
in specialised commissioning under these arrangements will be
important.
28. There are a number of services which
are not specialised enough to be commissioned by the NCB, but
which could not be commissioned effectively by individual consortia
acting in isolation. Cancer, stroke care, trauma, and high-risk
complex surgery are examples of services that fall into this category.
To ensure quality and safety, these services are best delivered
by concentrating services in specialist centres, and the commissioning
of them needs to occur across a larger geographical area or population.
29. To commission such services successfully,
consortia will need to aggregate and commission collaboratively.
It may not be sufficient to allow such collaboration to happen
organically. The Department of Health will need to give careful
thought to what structures or guidance may be needed to allow
inter-consortia commissioning to be undertaken effectively.
CONCLUSIONS
30. Although there have been recent improvements
in the quality of commissioning in the NHS, many of the shortcomings
highlighted by the Health Committee's last report on commissioning
still exist, and the characterisation of commissioning as the
"weak link" remains fair. International experience indicates
that other countries face similar challenges and there is no health
care system in which commissioning is done consistently well (Dixon
2010).
31. The government's proposed reforms aim
to address some of the shortcomings in commissioning. However,
they do so at the expense of considerable disruption to the operation
of the NHS over the next three years, and while they may succeed
in tackling some long-standing problems, they also introduce some
considerable new risks. We would question whether the scale and
pace of the reforms are necessary, particularly given the evidence
that both the NHS generally and the commissioning function specifically
have been on a path of gradual improvement over recent years (Thorlby
& Maybin 2010). Unresolved questions raised by the proposals
include:
— Where will the much needed local and
regional system leadership reside in the absence of PCTs and SHAs?
— Will consortia be able to carry the financial
risks associated with random fluctuation in population health
needs?
— Will organisational upheaval distract
from the productivity challenge that the NHS needs to be focusing
on over the next five years?
— Will the proposed constraints on management
allowances make it difficult for consortia to access the management
support they will need?
32. As policy continues to be developed
and refined, we hope that this inquiry will help bring greater
clarity to these difficult but important questions.
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October 2010
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