NHS specialised services Contents

1The commissioning of specialised services

1.On the basis of a report by the Comptroller and Auditor General, we took evidence on the commissioning of specialised services in the NHS from the Department of Health (the Department) and NHS England.1 ‘Specialised services’ are usually for patients who have rare conditions or who need a specialised team working together at a medical centre. There are currently 146 specialised services, covering a diverse range of disparate and complex services, from services for long-term conditions, such as renal (kidney) and mental health problems, to services for uncommon conditions such as rare cancers.2

2.Specialised services are generally provided in relatively few hospitals and accessed by small numbers of patients. Some highly specialised services, including those for very rare diseases, are only provided at a very small number of centres across the country. Others, such as chemotherapy services, are provided by most acute hospitals. Some specialised services, such as those for cystic fibrosis, cover the majority of care for a patient once diagnosed. However, most specialised services only form a part of a patient’s care and treatment pathway.3

3.In April 2013, NHS England took on responsibility for commissioning specialised services, including setting the budget for these services. The Secretary of State for Health is responsible for deciding which services should be commissioned as ‘specialised services’. Through its commissioning of these services NHS England aims to: improve outcomes for patients; ensure patients have equal access to services regardless of location; and improve productivity and efficiency.4

4.Between 2013–14 and 2015–16, the budget for specialised services increased by 6.3% a year on average, compared to 3.5% for the NHS as a whole. In 2015–16, the budget for specialised services was £14.6 billion, accounting for 14.4% of total budget for the NHS. By 2020–21, NHS England plans to increase its budget for these services to £18.8 billion, 16% of its total budget, with a 7.0% increase for 2016–17.5

Oversight

5.NHS England confirmed that its objectives for specialised services are to: (a) ensure that patients get high-quality care and that its uses national oversight to level-up standards and quality across the country; (b) maximise what it gets for what it pays; and (c) to link up the specialist part of health services with the local part of services so the care is ‘seamless from the point of view of the patient involved’. However, stakeholders told us that NHS England still has no clear strategy or delivery plan for specialised services.6 The National Audit Office found that 65% of NHS acute trusts and 73% of clinical commissioning groups responding to its surveys disagreed that NHS England had clearly communicated its long-term plans for specialised services. The National Audit Office also reported that the lack of clarity and direction has made it difficult for clinical commissioning groups and NHS acute trusts to plan and develop their services.7

6.NHS England acknowledged that in its first year of operation it had focused on getting clinical commissioning groups up and running and less time was focused on the commissioning of specialised services. NHS England also confirmed that, in 2014–15 and 2015–16, its focus was on keeping its spending on specialised services within budget and that it will now focus on improving these services and the value it gets from its spending on them.8

7.The NHS Five Year Forward View, published in October 2014, estimated that there would be a £30 billion gap between resources and patient needs by 2020–21 and set out proposed changes to the provision of healthcare services to meet this gap. However, various stakeholders, including the Medical Technologies Group, told us that, despite accounting for 14% of the total NHS budget, NHS England has not clarified how the commissioning of specialised services sits within the Five Year Forward View. Similarly it had not clarified how these services will contribute to the £22 billion efficiency challenge that the NHS has over the next five years, in order to meet the funding gap.9

8.NHS England has sought to drive efficiencies by reducing the prices paid for NHS services, including specialised services. But NHS trusts, including those trusts providing specialised services, are finding it increasingly difficult to remain financially sustainable—at the end of the third quarter of 2015–16 about 80% of acute hospital trusts were in financial deficit.10 The Department told us that there will be a 2% efficiency requirement for 2016–17, set within the price paid to NHS trusts for NHS services, which it believes to be ‘difficult but realistic’. NHS England also confirmed to us that in 2016–17 it would provide a £1.8 billion sustainability and transformation fund to help trusts in financial difficulty to achieve financial balance.11

Transparency over decision-making

9.Over the last three years, NHS England has overhauled its governance arrangements for the commissioning of specialised services twice. Only 29% of acute trusts surveyed by the National Audit Office reported that NHS England’s governance arrangements were transparent. NHS England told us that it is now confident that the arrangements now in place, headed by the national director for specialised services, are ‘fit for purpose’.12

10.A number of stakeholders, including patient interest groups and pharmaceutical companies, told us that they were particularly concerned about the lack of transparency over NHS England’s decision-making on the funding of new treatments.13 The National Audit Office reported that NHS England does not make publicly available any of the minutes or meeting notes, including those on the funding decisions for new treatments, of its key decision-making groups, such as the Specialised Commissioning Oversight Group. In May 2016, the High Court criticised NHS England’s funding decision concerning a drug for a severe neurological condition.14

11.NHS England said that the funding of new treatments is an area where the “asks are always greater than the ability to instantly fund them” and that “some very difficult decisions will inevitably have to be taken”.15 NHS England told us that it is consulting on a new decision-making process which will be used for the introduction of new treatments from June 2016, as currently it has no process in place to prioritise funding requests. The new process will consider both the clinical benefit and the cost of a new treatment and use a nine-box algorithm to rank the treatments and decide which should be funded.16

Collaborative commissioning

12.For many patients, in particular, those patient with long-term conditions, specialised services often only cover part of their care, with other commissioners involved in the rest of the patients’ care pathways. For example, if a cancer patient needs surgery, this will be funded by their local clinical commissioning group; but if the patient needs chemotherapy or radiotherapy, this is likely to be funded by NHS England as a specialised service.17

13.For some patients, this division has led to their care becoming disjointed. NHS England recognises these issues and intends to commission more specialised services collaboratively with clinical commissioning groups. However, a number of stakeholders, including the MS Society, advised us that this approach is beset with difficulties. The MS Society felt that NHS England did not clarify the implications of co-commissioning when the idea was first mentioned in November 2014 nor did it provide sufficient detail in its subsequent guidance on collaborative commissioning.18 The National Audit Office’s survey of clinical commissioning groups found that, while most groups supported a more joined-up approach to commissioning specialised services, only 37% felt that NHS England had clarified what it meant by collaborative commissioning. These groups believed that more clarity about costs and better engagement with NHS England were still needed.19

14.NHS England told us that there were originally two sets of concerns to its approach to collaborative commissioning. Firstly, individual clinical commissioning groups were worried that they either ‘lacked the bandwidth’ or would be managing financial risk that they were not certain about. Secondly, some patient advocates were not keen for services to be distributed to local clinical commissioning groups as they liked the fact that they could hold NHS England to account for national consistency of services. NHS England told us that improving the transparency of its budget allocation and having consistent service standards will help to address these concerns. NHS England noted that it had now introduced ‘place-based allocations’ for NHS funding so clinical commissioning groups can see how the funding is divided up in each geographical area including funding for specialised services.20

1 C&AG’s Report, The commissioning of specialised services in the NHS, Session 2015–16, HC 950, 27 April 2016

2 Qq 2, 87; C&AG’s Report, para 1.2

3 Q 2; C&AG’s Report, para 1.3

4 Qq 2, 67; C&AG’s Report, paras 1.5–1.6

5 Qq 1, 31, 56; C&AG’s Report, paras 1.8–1.9, Figure 6

6 Q 2; Specialised Health Care Alliance (NSS0019), the Medical Technology Group (NSS0006), the MS Society (NSS0009)

7 Q 2; C&AG’s Report, paras 2.4–2.5, Figure 9

8 Q 1

9 Q 65; Committee of Public Accounts, Thirtieth Report of Session 2015–16, Sustainability and financial performance of acute hospital trusts, March 2016; C&AG’s Report, para 13; the Medical Technology Group (NSS0006)

10 Qq 48–53, 63, 92; C&AG’s Report, paras 2.18–2.21; The Shelford Group (NSS0013)

11 Qq 55, 65, 92

12 Qq 43–44; C&AG’s Report, paras 2.6–2.7

13 Q 45; Association of the British Pharmaceutical Industry (NSS0008), Alexion (NSS0007), the Specialised Healthcare Alliance (NSS0019), the Medical Technology Group (NSS0006), the Terrence Higgins Trust (NSS0010), Muscular Dystrophy UK (NSS0021), Pulmonary Hypertension Association UK (NSS0013)