Written evidence from the NHS Confederation
(COM 121)
1. INTRODUCTION
The NHS Confederation is the independent membership
body for the full range of organisations that make up the modern
NHS. We have over 95% of NHS organisations in our membership including
ambulance trusts, acute and foundation trusts, mental health trusts
and primary care trusts plus a growing number of independent healthcare
organisations that deliver services on behalf of the NHS.
We are pleased to have the opportunity to submit
evidence to this inquiry. The comments in this submission reflect
the views and experience of our NHS and independent sector provider
members, as well as those of our PCT members as the current statutory
commissioners in the English NHS.
More detailed information about our members'
views on the Government's health White Paper can be found in our
responses to the Department of Health's consultations.
2. SUMMARY
— We support the Government's objectives
in the White Paper. Empowering patients is clearly the right thing
to do. There are strong arguments for involving clinicians more
closely in decisions about the design of care and management of
resources, and holding them to account for these decisions. We
also support the Government's aspirations to further strengthen
commissioning as we believe commissioning is a critical component
of a tax funded health care system and will become more important
than ever as resources become tighter.
— However after analysing the proposed
system, we have identified significant risks, worrying uncertainties
and unexploited opportunities. All of these will need to be addressed
if the reforms are to have the best chance of success. Our key
concerns include:
— A lack of clarity on the accountability
of GP consortia to patients, the public and Parliament.
— Risks of an over-reliance on market mechanisms
to manage complex health services.
— Risks of fragmentation of commissioning
and health service provision as a result of the proposals.
— Risks of weakening the commissioning
of primary care services.
— We feel there are potential tensions
between the ideas that service change and improvement will increasingly
be driven through patient choice and competition, that GP commissioning
consortia will make commissioning decisions on behalf of their
patients, and the intention that Health and Wellbeing Boards including
locally elected politicians will have significant influence over
those decisions and so strengthen the democratic accountability
of the NHS.
— More attention must be paid to the transition
to the new system, particularly stability and confidence in commissioning
arrangements for providers, capability and capacity building,
the significant culture change required, and how significant efficiency
savings will be delivered whilst major reforms are ongoing. Key
issues during transition include:
— Significant reductions in management
capacity as a result of management savings requirements risks
causing quality and financial performance deterioration over the
next two years.
— Risks of loss of commissioning capacity
and expertise from PCTs, leaving GP consortia without the necessary
support and organisational memory.
— The importance of capacity building for
the proposed GP consortia to prepare them for the complex commissioning
responsibilities they will be taking on.
— Explaining the significant cultural change
that the reforms will require and helping the public, the NHS,
media, and MPs to understand its implications.
3. CLINICAL ENGAGEMENT
IN COMMISSIONING
How will commissioners access the information
and clinical expertise required to make high quality decisions
about the shape of clinical services?
How will commissioners address issues of clinical
practice variation?
How will GPs engage with their colleagues within
a consortium and how will consortia engage with the wider clinical
community?
3.1 It is important that the reform proposals
are further developed and implemented in a way that enables and
supports engagement and cooperation between GP commissioners and
the wider clinical community (including other providers). Factors
which could create barriers to this engagement include:
— Procurement and competition rules, if
not applied appropriately.
— Providers' funding arrangements and incentives.
— Sufficiency of management resources to
sustain effective engagement.
3.2 The government's expectations as to
what extent and when commissioning consortia will be expected
to proactively specify or shape services, or intervene to address
issues of clinical variation, also need to be clarified. This
will affect the governance, management and support arrangements
they will require.
3.3 We feel the proposals should make more
of the potential of GP consortia to drive improvements in primary
care provision. We believe the Government should give the NHS
Commissioning Board the power to delegate responsibility for practice
performance and contract management of General Medical Services
(GMS) contracts to GP consortia where appropriate. The distribution
of any performance payments related to commissioning should be
the responsibility of the consortia.
4. SERVICE RECONFIGURATION,
STRENGTHENING COMMISSIONERS
AGAINST PROVIDER
INTERESTS AND
OPENING THE
SYSTEM TO
NEW ENTRANTS
Will care providers be free to offer new solutions
which offer higher clinical quality, better patient experience
or better value?
Will commissioners be free to access new commissioning
expertise?
Will potential new entrants be free to offer alternative
commissioning models?
What arrangements will be made to encourage the
Third Sector both as commissioners and providers?
How will the proposed system facilitate service
reconfiguration?
How will the new arrangements strengthen commissioners
against provider interests?
Implications for providers
4.1 We welcome the commitment to increasing
choice and quality for patients and value for taxpayers, facilitated
by a healthy provider market including both NHS and non-NHS providers.
4.2 Healthcare providers will need to see
clear market opportunities and sufficient stability to give them
the confidence required to make investments and service changes.
There is some concern that the instability and uncertainty caused
by the current approach to managing transition could undermine
potential new entrants' confidence. There are also concerns that
existing providers could face higher transaction costs on an ongoing
basis if the number of commissioning organisations increases.
Factors that could help to provide greater stability and confidence
include:
— Clarity of market rules and simplified
contracts.
— Sufficient scale and scope of commissioning
organisations.
— Aligned rewards, incentives and rules.
4.3 We believe the government should put
in place an assurance system to ensure GP consortia establish
strong governance arrangements with clear, transparent and robust
decision-making to address any conflicts of interest between their
roles as commissioners and providers.
4.4 There is concern that with the loss
of PCTs and SHAs there will no longer be any safeguards to protect
against system failure, at a time when supply-side controls are
liberalised and commissioning is reorganised. Monitor's new role
as the economic regulator will be crucial. It should be required
to engage with GP consortia as well as the NHS Commissioning Board
and should have a duty to work to support the interests of both
commissioners and providers.
Sources of commissioning expertise
4.5 Exceptionally strong clinical and managerial
leadership will be required in the establishment and development
of GP consortia, and in the ongoing management of complex relationships
with a wide range of partners. Some GPs will also need support
and training to develop more technical strategic commissioning
skills in order to run the consortia effectively, and to be an
"intelligent client" of commissioning support providers.
4.6 Independent sector organisations are
already involved in providing commissioning support services.
However despite involvement in certain areas of commissioning
the existing market does not have a track record of running comprehensive
health service commissioning support services, and a process of
market development will be required to ensure the requisite services
are available to GP consortia and the NHS Commissioning Board.
Start-up funding may be necessary to encourage investment and
recruitment, particularly for smaller or more specialist organisations.
4.7 People currently working in PCTs, Specialised
Commissioning Groups, and SHAs are best placed to support GPs
to develop their own skills and evaluate support service providers,
as they have the most up-to-date skills and expertise in these
areas.
5. ACCOUNTABILITY
FOR COMMISSIONING
DECISIONS AND
RESOURCES
How will patients make their voice heard or their
choice effective?
How will commissioning interface with Health Watch?
What will be the role of the NHS Commissioning
Board?
What legal framework will be required to underpin
commissioning consortia?
Where will the "buck stop" when commissioners
face hard choices?
What arrangements will be made to safeguard patient
care if a commissioner gets into difficulty
What legal framework will be required to underpin
commissioning?
5.1 In our consultation with members the
proposed accountability structures have caused most confusion
and uncertainty.
Accountability of the NHS Commissioning Board, GP
consortia and their member practices
5.2 The exact nature of the NHS Commissioning
Board's accountability to Parliament is unclear. Many of the issues
of most concern to local MPs will be the responsibility of consortia,
with oversight sitting with local Health and Wellbeing Boards.
We believe the government should make explicit where in the new
system MPs and local councillors should direct enquiries they
are making on behalf of their constituents about healthcare, and
who will be expected to respond to these enquiries.
5.3 Clarification is also needed on the
relationships between GP commissioning consortia, their member
practices, the NHS Commissioning Board, Health and Wellbeing Boards
and Monitor.
5.4 Currently, we feel there is confusion
and possible conflict between the ideas that service change and
improvement will increasingly be driven through patient choice
and competition overseen by the economic regulator, that GP commissioning
consortia will make commissioning decisions on behalf of their
patients, and the intention that Health and Wellbeing Boards including
locally elected politicians will have significant influence over
those decisions and so strengthen the democratic accountability
of the NHS.
5.5 The White Paper indicates that Health
and Wellbeing Boards will take on the existing scrutiny powers
of local authorities, but it is not clear whether they will have
any additional powers to shape or make decisions about local health
services, which will be commissioned by GP consortia, or what
roles elected members and local authority officials are expected
to play on these boards.
5.6 The proposals suggest that local authorities
will enable strategic coordination of health and social care locally
but that this will not involve day-to-day interventions in services.
We are concerned that confusion and conflict of interest could
result in cases where there is no clear and easily definable distinction
between strategy and implementation.
5.7 The arrangements for consultation on
and scrutiny of major strategic changes pay too little attention
to the potential for provider-led service change, and the relationship
between the Health and Wellbeing Boards and Monitor is also unclear.
5.8 If local government and locally elected
politicians are to be given greater influence over the NHS, and
perhaps take on some of the system management roles currently
performed by PCTs, they must be given the requisite powers and
authority, and this transfer of accountability should be made
clear to the public.
5.9 Alternatively, if the Government proposes
to remove the state's role (currently carried out by PCTs) in
overseeing, monitoring, and at times intervening in the running
of local health systems in favour of more market-based mechanisms
for driving quality improvement, this again should be clearly
and transparently articulated.
Governance and decision-making
5.8 As well as clarity regarding their accountability,
GP consortia will need a clear understanding of the standards
of governance that are expected of them, although this need not
involve direction as to how to achieve these standards.
5.9 We believe the Government should spell
out how it will deal with GP consortia that fail, and ensure that
the rewards of success and the consequences of failure are proportionate
and significant enough to have an impact on their behaviour.
5.10 We believe the Government should consider
whether it needs to set out in regulations which decisions about
quality standards and access to services will be consistent across
the country and which will be left to local commissioners to determine.
GP consortia will be subject to legal challenge about how they
make prioritisation choices and will need to have very clear frameworks
for decision-making. This will be particularly important in light
of the EU directive on the application of patients' rights in
cross-border healthcare.
5.11 We believe the Government should ask
the NHS Commissioning Board to set out a transparent method by
which it will turn NICE recommendations, based on clinical and
cost effectiveness, into affordable commissioning criteria.
Patient voice
5.12 It is vital that all organisations
involved in commissioning health and social care services ensure
effective patient and public engagement is integral to their commissioning
processes. This should include feedback from individual patients
and users of services, but also broader public views on local
services, including those of people who may not access services,
and who may be less willing or able to express their opinions.
The management allowance for GP consortia and the resources of
the NHSCB will need to be sufficient to cover this.
5.13 Existing practice patient groups and
the proposed local HealthWatch arrangements could potentially
play an important role as part of a wider range of engagement
and involvement opportunities, but we do not believe they would
be sufficient as they currently operate or are described. Particular
attention should be paid to the resourcing and capacity development
of HealthWatch. We believe the government should consider tasking
Citizens' Advice Bureaux to provide complaints advocacy and support
for choice locally, but should ensure specialist advocacy services
are retained to support some of the most marginalised and disadvantaged
users of health and social care services.
5.14 Inherent conflicts of interest between
HealthWatch England and the Care Quality Commission, and between
local HealthWatch and their local authority, especially in relation
to the scrutiny of their social care commissioning role, require
resolution by government.
5.15 Further clarity is needed about the
extent to which choice of commissioner is intended to play a part
in driving improved quality and outcomes. The power of patient
choice to send signals to consortia will be very limited in practice
and other methods will be required.
6. WHAT WILL
BE THE
ROLE OF
LOCAL AUTHORITIES
IN PUBLIC
HEALTH AND
COMMISSIONING DECISIONS?
How will any new structures promote the integration
of health and social care?
What arrangements are proposed for shared health
and social care budgets?
How will commissioning interface with the Public
Health Service?
6.1 It will never be possible to design
a system at a national level that resolves the complexity of the
gaps and tensions between healthcare, public health and social
care. We therefore agree that the government's role should be
to clearly set out the outcomes to be achieved, and that as far
as possible local partners should develop their own ways of working
together to achieve them.
6.2 However, we believe that further detail
regarding the parameters within which local partners will be required
to work (for example, how funding will flow to them and what rules
will be applied to it, what duties and powers they will have,
who they are accountable to) is required.
6.3 The government should clarify the public
health and health improvement roles and responsibilities of the
different tiers of local government, and how these relate to the
Health and Wellbeing Board, and provide the flexibility for joint
health and wellbeing boards across local authority areas. Clarification
is also required about how public health funds will be defined,
devolved and ring-fenced.
6.4 Improving integration will require co-ordinated
planning across systems and incentives for commissioners and providers
to work together. Local authorities and GP consortia will carry
out joint local area assessments of need, and we believe they
should be asked to work together to develop and deliver a joined-up
health, public health and social care strategy in response.
6.5 GP-led commissioning consortia will
require access to public health expertise. It is currently unclear
whether they will be expected to purchase these services from
local authorities (in which case their management allowance must
be sufficient to cover this), if directors of public health will
be responsible for making them available, or whether the new Public
Health Service will have a role.
7. RESOURCE ALLOCATION
How will resources be allocated between commissioners?
What arrangements are proposed for risk sharing
between commissioners?
7.1 Since the formula for allocating NHS
resources to PCTs was last reviewed, there has been a gradual
move toward "fair-share funding", though incremental
changes to PCTs' annual allocations. This process has so far been
very slow, in order to avoid suddenly destabilising local health
economies that are "above target". Consortia who find
their inherited budgets are "below target" according
to the current formula will want assurances that they will receive
a fair allocations, but rapid changes to allocations and funding
formula could have severe consequences for consortia that find
their budgets reduced below the historical levels of spend. Establishing
fair share allocations for consortia could be extremely complex,
and failure to find ways through this could seriously undermine
the policy.
7.2 We are clear that if GP consortia are
to receive the funding for all local health services they must
also take on all of the existing commitments and liabilities that
come with it, otherwise the incentive to resolve problems that
have precipitated overspends, such as inefficiently configured
acute services, will not exist.
7.3 Risk pools for consortia and other commissioners
will be an important part of the system, but we believe the Government
needs to prevent proliferation of overlapping risk pools to avoid
taking significant financial resources out of circulation.
7.4 Further consideration of the financial
risk posed to GP consortia by the rapidly rising cost of paying
for NHS continuing health care (CHC) is required.
8. SPECIALIST
SERVICES
What arrangements are proposed for commissioning
of specialist services?
How will these arrangements interface with the
rest of the system?
How will vulnerable groups of patients be provided
for under this system?
8.1 We agree that the commissioning of designated
specialised high-cost, low-volume services should not be devolved
to individual consortia. However, if the NHSCB is to take on this
role the following issues need to be considered:
— Local knowledge is required to understand
patterns of need, demand and service configuration and enable
robust contract and performance management. Some form of "sub-national"
presence and leadership will be necessary.
— Inter-dependencies between higher-volume
non-specialised services and specialised services mean there are
risks in commissioning these separately, including cost and blame-shunting,
which will need to be managed with the involvement of GP consortia.
8.2 We believe a set of clear principles
should be developed for determining what will be commissioned
nationally or at a local level, and where consortia should consider
joining together in shared arrangements or handing over commissioning
responsibilities to a specialist agency. These principles could
be provided by Government or developed by national representative
bodies.
8.3 It will be important to establish what
support consortia will need in commissioning services that, although
not designated as specialised, may still require particular knowledge
and expertise, or where commissioning will need to be coordinated
across multiple consortia.
8.4 For example, GP-led consortia may require
particular support in commissioning mental health services, including
from non-NHS organisations with access to service user, carer
and clinical expertise. We believe that GP consortia should work
with specialist providers to develop and deliver a capacity-building
programme to ensure that GP consortia have the right expertise
to commission mental health services.
8.5 We also believe that certain urgent
and emergency are services, including emergency preparedness and
ambulance responses, will need to be commissioned at a multi-consortia,
and in some cases a national, level.
9. TRANSITIONAL
ARRANGEMENTS
Will the new arrangements safeguard current examples
of good practice?
How will transitional costs (redundancy etc) be
minimized?
Who will drive innovation during the transitional
period?
9.1 A failure to manage transitional risks
effectively could result not just in examples of good practice
being lost and rates of improvement slowing, but also in serious
financial or quality failures in parts of the NHS. It is vital
that the transitional period is given as much attention as the
design of the system.
9.2 If new commissioners are required to
build their confidence and skills from scratch, potential new
providers could lack confidence in the system, and progress towards
a more dynamic and diverse provider market could stall for a number
of years. Commissioners' decision-making processes could also
become cumbersome and fragmented while multiple stakeholders establish
their positions in the new system, which could make it more difficult
for existing providers to take forward necessary reconfiguration
plans and proposals for efficiency savings.
9.3 There are a number of actions that we
believe would help including:
— Assurance that there would be a degree
of continuity and properly managed transition to new commissioning
arrangements.
— Early confirmation of the arrangements
for the new commissioning bodies, particularly their functions,
how funding will flow to them, the financial rules that will apply,
and the accountability framework.
— Investment in capability and capacity
building for GPs and other clinicians who will be involved in
the leadership of the new consortia, and access to expert commissioning
support in the meantime. Primary care trusts have built up a wealth
of expertise that will be vital to the success of the new consortia.
Urgent action is needed to retain good staff and preserve organisational
memory; it will be difficult and expensive to re-build this knowledge
and skills base.
9.5 We support scrutiny of management costs
as part of the wider NHS productivity drive. During the transition
period, the focus should be on managing the overall costs and
sustainability of a system facing huge financial challenges. Our
members have major concerns that doing this alongside developing
the capacity and capability of GP consortia will not be possible
with 45% management cost reductions over the next few years.
9.6 In providing effective and good quality
services to patients, management is an essential investment, not
just a cost. The Government should acknowledge the contribution
and progress made by the existing PCTs, which still have responsibility
for the control of finances and delivery at present. To do this
will send a positive message to those who are set to take over
these responsibilities: potential leaders of GP consortia should
not think that that they will be the next in line for criticism
when tough decisions are needed and difficult change has to be
managed.
October 2010
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