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Earl Howe: My Lords, Amendments 221, 222, 223 and 223A refer to the incentive scheme for CCGs. This scheme will allow the board to reward CCGs for their performance in the light of at least one of the following factors: the quality of services provided; any improvement in the quality of those services compared with previous years; outcomes achieved for patients; and any improvements in outcomes as compared with previous years. The board may also consider the extent to

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which the CCG has tackled inequalities. The purpose of the quality payment is to reward CCGs for these areas, and not, as some saw it, for saving money on their budgets. Unequivocally, the board can make a payment to a CCG only where the group has performed well on quality of services or outcomes achieved for patients. It is a well established principle of public health service reform to acknowledge and reward the provision of high quality services. Quite simply, we believe that commissioners should also be rewarded for commissioning high quality services for patients.

Amendment 222 amends the criteria which the board will take into account. The amendment would mean that the board would be able to consider only improvements in health outcomes identified during the particular year. Health outcomes will indeed be crucial, and will be measured through the commissioning outcomes framework, but we must not prevent the board from rewarding improvement in other outcomes which are of benefit to patients.

The Bill gives the Secretary of State the power to make regulations as to how CCGs may spend payments received in respect of quality. Amendments 223 and 223A would require any regulations made under this provision to limit CCGs to using any payment received under the scheme for the benefit of patients or to improve health outcomes. This risks blunting the scheme. There are a range of ways in which CCGs could potentially use the money that they have earned for quality of patient care, and we must not exclude the potential for the CCG to allow members to spend this money as they see fit, including rewarding the members for their work if that incentivises the membership. If the payment is required to go into the commissioning budget, it might well eventually be no incentive at all. To ensure transparency, CCGs must publish an explanation of how they have spent any quality payment which they receive. If we can get this right, it is money well spent, as it will incentivise the delivery of improved outcomes. If such performance is not apparent, then the payment will not be made.

As the Bill makes clear, the quality payment rewards outcomes for patients, not processes or targets. It is certainly not a reward for efficiency. Final decisions, however, on the design of the quality reward have not been made yet. We intend to discuss our proposals further with the profession. This is not about paying GPs extra. It is about rewarding CCGs for successful commissioning. We agree that there needs to be further debate about how CCGs use the reward, and that is why we have introduced a regulation-making power which will enable limitations to be placed on how it is used.

We do not want to rule out the possibility of clinical commissioning groups being able to reward their members. We would otherwise run the risk, as I said, of blunting the value of the quality payment as an incentive, but we agree that great care would be needed to devise any such payments so that they are fair and proportionate, and create the right incentives to deliver high-quality care for patients-hence the provision in the Bill to make regulations.

That is probably all the detail that I can give at the moment. The noble Lord, Lord Hunt, asked me about the size of payments. I am not in a position to commit

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to an indicative figure at the moment. It will be up to the NHS Commissioning Board to determine the level of payments, and I am not in the business of tying its hands on that. There is quite a lot of thinking still to do about the design of this payment, as I indicated. I am sure we will return to the subject at a later date.

Lord Hunt of Kings Heath: My Lords, that was broadly reassuring. There are just two points I would make. First, there are plenty of examples where cost-improvement programmes have taken place and staff on the unit have received a certain percentage of that cost-improvement to spend on better services. I do not think that there has been any inhibition on their part because it has not gone into their personal pocket. I would have thought that most people in the health service, including GPs, would accept that if there were payments to be made, it would be right that they go to improve patient care one way or another. I hope the Minister might look at that again.

There is a real risk here. Let us look at outcomes, quality and improvement. I would have thought that an impact on demand management, where the commissioning group GPs were working together to ensure, for example, that there were not inappropriate admissions into hospital, would qualify as a quality improvement. However, we must accept that, for the public, demand management sometimes presents some really tough issues. Even when they instinctively think that they might be better off in hospital, they probably would not be, but in encouraging patients not to go

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into hospital, GPs may find that the public query their motivation for doing so. Because of that, if there were any financial rewards, it would be much better if they were to go into the commissioning group as opposed to its members' own pockets. I am genuinely concerned about this impacting adversely on the doctor-patient relationship.

The noble Lord has said that this is work in progress. My aim has been to pass on comments to the noble Earl about what he might consider in the future. On that note, I beg leave to withdraw the amendment.

Amendment 221 withdrawn.

Amendments 222 to 223A not moved.

Clause 24 agreed.

Clause 25: Requirement for primary medical services provider to belong to clinical commissioning group

Amendment 224 not moved.

Clause 25 agreed.

Amendment 224A not moved.

Clause 26 agreed.

House resumed.

House adjourned at 12.44 am.

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