Public expenditure on health and care services - Health Committee Contents

5  Re-imagining care

84.  This report has repeated many themes which have featured in the Committee's previous reports. In this chapter we aim to set out our ideas about how policy should respond to the challenges we have identified.

85.  Although total funding for health and care has been the subject of extraordinary growth in the last 50 years, and though it is likely that in the longer term taxpayer preferences will sustain continued increases in future, the Committee does not consider that it is realistic to plan for significant additional taxpayer resources in the short to medium term. Against that background the Committee has developed its ideas on the basis of current funding levels for health and care, including the additional resources provided to the care system by the Government's recent decision to fund a modified form of the recommendations of the Commission on Funding of Care and Support (the Dilnot Commission). [65]

86.  The heart of the Committee's approach is that the care system should treat people not conditions. Services should adapt to people, not the other way round.

The Dilnot Commission

87.  The main recommendations of the Dilnot Commission's report concern the introduction of a series of caps on the contributions required from individuals to the cost their own social care. They recommended a cap of between £25,000 and £50,000 on the amount that any individual has to pay for their care, after which the state would bear the costs. They also recommended that this capped figure would not include costs associated with accommodation, food and other living costs, but that these should subject to a separate cap of between £7,000 and £10,000 per year. [66]

88.  The Government has accepted the key principles set out in the Dilnot Report with the key exception that it proposes that the cap on individual contributions should be set at £75,000 in 2017-18 prices (equivalent to £61,000 at 2010-11 prices).[67] The Committee plans to review the implications of the Government's proposal to introduce the cap at a higher level than recommended by Dilnot, but it welcomes the Government's endorsement of the principles set out by Dilnot, and its commitment to introduce the necessary primary legislation.

Integrated care

89.  There are three fundamental tests of whether a public health and care system is functioning well and in the best interests of the population it serves:

  • Does it deliver high quality care?
  • Is it accessible to the population?
  • Is it affordable?

90.  The conclusion which we draw from the evidence we have taken on public expenditure on social care, as well as from our recent visit to Denmark and Sweden, is that these three objectives cannot continue to be met by the NHS operating on present lines and with the constraints on expenditure it is likely to experience for the foreseeable future. Only greater integration of health and care services will maintain and improve access to the high quality care which should be at the heart of the NHS's purpose.

91.  There is evidence, for example, that 30% of admissions to the acute sector are unnecessary or could have been avoided if the conditions had been detected and treated earlier through an integrated health and care system. Earlier intervention in these cases would lead to better quality outcomes and less pressure on stretched resources in the acute sector. Mike Farrar of the NHS Confederation told us:

Almost every threshold assessment survey that is assess whether or not people are in hospital services who would have needed hospital services reveals that there are somewhere between 30% and 40% of patients who, had we had alternatives in place, could have been treated elsewhere... it is a safe bet that we do not need at least 30% of our acute capacity and we would have, in my view, to be intelligent in the way that we then distributed the services we do need to make sure we have the best opportunity for patients to get care. The good news is that it could probably be done without reducing quality. The downside is that the alternatives have to be available. People cannot be expected to support capacity being taken out if they cannot see where the improved services are. Therefore, community, primary and social care strengthening are absolutely critical to being able to reconfigure hospitals.[68]

92.  We asked the NHS Confederation, LGA and ADASS jointly to advise the Committee what it would take to unlock the pathway to integrated care, and they set out a number of requirements that would need to be fulfilled.[69] Two of those requirements struck us as particularly significant:

  • allowing local flexibility for the NHS and local authorities to commission and deliver integrated care; and
  • streamlining the mechanics for joint funding mechanisms.[70]

93.  Equally significant were their recommendations about what central government should not do. It should not:

  • Raise public expectations that integrated care will be the answer to all the challenges facing the health and care system (that is, it should be realistic)
  • Over-specify what integrated care is or is not (essentially the point about local determination in another guise)
  • Engage in another major structural re-organisation of the health service (for reasons which are largely self-evident)[71]

94.  In the light of this advice (which we believe would be widely endorsed) the Committee does not believe that the policy objective of more integrated health and care services would be best served by further organisational change. Nor do we believe that such change is necessary to achieve this objective.

95.  We recommend that the new health and wellbeing boards should be developed as the forum in which all interested parties should evolve the future shape of health and care services in their area. Developing the health and wellbeing boards as the forum in which integrated care is developed would also help to ensure that the Government's new proposals for funding care of the elderly are implemented within the context of a commitment to wider service system re-design. This would help to ensure that new funds do not become locked into static models of care but used to promote understanding and evidence of how to facilitate independent living.

96.  We have already set out in our report on social care the principle of a single commissioning process with a single commissioning budget derived from the shared resources of health and social care.[72] In response, the Government accepted that joining together budgets made sense:

The Government recognises that integrated commissioning budgets can be a positive step towards delivering better integrated care. As part of the new arrangements, the NHS Commissioning Board and health and wellbeing boards have a duty to promote the use of joint budget arrangements between CCGs and local authorities where it would benefit patients, service users and carers. The Government expects these bodies to maximise the use of joint budget arrangements where it would benefit patients, service users and carers. Commissioners will be held to account for commissioning high-quality services with good outcomes, many of which will only be achieved if services are designed and delivered in an integrated way.[73]

97.  We also consider that our proposals are entirely in line with what the NHS Commissioning Board has in mind. We asked Sir David Nicholson if the Board would make integration of the work of clinical commissioning groups with social services easier than it is at present. He told us:

It is important that we do. The Health and Wellbeing Boards, as a forum to bring everyone together to do that, are really important. If we find that there are obstacles to transferring resources across the system, we will take action as a Commissioning Board to enable that to happen. We are keen to support that because we think it is absolutely the future. Everything else fails if we do not get that bit of it absolutely right.[74]

We also asked about our point on rebalancing expenditure across all services for older people, to which he responded positively,[75] and on where the budget might be held. He said;

There are things we can get over, so there is more pooling of budget and we are absolutely in favour of it. Where it becomes difficult is that our offer to the population is different from that of local government. Our offer is universal, free at the point of use and theirs is not. We get into real difficulties, I think, when we get into that kind of area. So, from the NHS perspective, we have to be careful that we do not by accident introduce charging and things like that into the NHS system... but we want to do that [pooling of budgets] very much.[76]

98.  There are other signs that the pooling of budgets is in the forefront of current thinking. It has been reported, for example, that the Government is considering making provision in the Care and Support Bill (currently being scrutinised in the Commons in draft) to require clinical commissioning groups to pool part of their budgets with local authorities as part of the joint planning process.[77]

99.  We welcome the positive approach to our ideas which we heard from both the Secretary of State and Sir David Nicholson. In particular we welcome their support for the development of single commissioning budgets as the lever which will deliver more integrated services. As the Committee stated in its previous report on Social Care, it is does not believe that repeated promises of cooperation and collaboration have delivered the necessary impetus for service re-design.

100.  Against the background of a common desire to avoid further management upheaval, and recognising the dangers of an over-prescriptive approach, the Committee repeats its recommendation that health and wellbeing boards and clinical commissioning groups should be placed under a duty to demonstrate how they intend to deliver a commissioning process which provides integrated health, social care and social housing services in their area.

101.  The key difference between the NHS and social care - that one is a charged-for service and the other is not - cannot be glossed over. The Committee has however been impressed by the fact that this obvious obstacle to the development of more integrated health and social care services has not been allowed to prevent developments in several areas (for example in Torbay); it believes that the key to success is to define the services which are subject to charges and ensure that this definition is entrenched in a way which gives patients confidence that it is not subject to convenient bureaucratic amendment.

102.  The Committee believes that the best way to provide services which treat people rather than conditions and services which adapt to people rather than causing people to adapt to services is to bring together funding, planning and commissioning of services around the forum of the Health and Wellbeing Board. All health and social care services in a given area should be included in this pooled process, including those which are developed to fund and implement the Dilnot proposals.

Ring-fenced budgets

103.  This chapter is focussed on the machinery required to develop more integrated health and care services. In particular it focusses on the need for a fully integrated commissioning process - bringing together the resources committed to the different traditional silos. This approach is motivated by the belief that greater integration of these services will allow them, to a significant extent, to meet growing demand for higher quality services through the elimination of cost and process duplication and poor interface management. If the health and care system to be seen as a single system, however it is inevitable that people will also increasingly cumulate the multiple revenue sources which fund the current service structure.

104.  In 2011-12, the NHS was allocated £98 billion by the Department of Health[78] and local authorities spent £17.2 billion on adult social care[79] (£115.2 billion in total).

105.  The final element that is needed to encourage health and wellbeing boards to look across the traditional service silos is confidence about the level of budget which is available for health and care. The Government's commitment to at least maintain the level of spending on NHS services in real terms provides NHS commissioners with that confidence; it would be a perverse outcome if a commitment to participate in single budget commissioning arrangements were to lead to a reduction in the resources available to social care - and therefore to reduced funding of the integrated care model which the Government is keen to encourage.[80]

106.  Against this background the Committee recommends that the Government should introduce a ring fence to protect the current level of real-terms funding available to social care. This approach would ensure that resources were no longer treated as 'belonging' to a particular part of the system, but to the local health and care system as a whole. With agreement on local priorities, and with binding commitments on the amount of money available to fund them, a flexible, responsive health and care economy could be established which would use the total budget provided for health and care more efficiently than is the case at present with separate funding streams and different objectives.

65   Commission on Funding of Care and Support, Fairer Care Funding. The report of the Commission on Funding of Care and Support, July 2011  Back

66   Ibid., Volume 1, pp 33 and 34 Back

67   Oral Statement by the Secretary of State for Health, 11 February 2013, HC Deb, columns 592-94; Policy statement on care and support funding reform and legislative requirements, Department of Health, 11 February 2013. Back

68   Q 14 Back

69   Q 73; Ev 116-118. Back

70   Ev 117 Back

71   Ev 118 Back

72   Health Committee, Social Care, HC 1582-I, paragraphs 40-43 Back

73   Department of Health Government Response to the Fourteenth Report of the Health Committee on Social Care, Session 2010-12, Cm 8380, July 2012, paragraph 10. Back

74   Q 207 Back

75   Q 211 Back

76   QQ 212-13 Back

77   CCGs and councils may share budgets, Health Service Journal, 11 October 2012Back

78   Ev 73, paragraph 20 Back

79   Health and Social Care Information Centre, Personal Social Services: Expenditure and Unit Costs - England 2011-12 - Provisional Release, 30 November 2012, p1 Back

80   Department of Health, Government response to Health Committee Report on Social Care, Cm 8380, paragraph 7 Back

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Prepared 19 March 2013