Forty Seventh Report Contents

Appendix 1: National Health Service Commissioning Board and Clinical Commissioning Groups (Responsibilities and Standing Rules) (Amendment) Regulations 2019

Additional information from the Department for Health and Social Care (DHSC)

Q1: Please summarise the Supreme Court’s verdict on the Welsh FNC rate

A1: In August 2017, the Supreme Court ruled against the Welsh Local Health Boards on how they had set the FNC rate in Wales.3 The administration and operation of the Welsh FNC rate is separate from the FNC rate in England, however, as the basis for FNC in legislation is very similar in Wales and England, the judgment of the Supreme Court also impacts on how the Secretary of State for Health must set the FNC rate in England.

The Supreme Court judgment set out an expanded definition of what constitutes ‘nursing care by a registered nurse’ and that the FNC rate should pay for the costs of everything within that definition:

(a)direct and indirect time on nursing care, i.e. care which can only be provided by a registered nurse

(b)paid breaks

(c)time receiving supervision

(d)stand-by time

(e)time spent on providing, planning, supervising or delegating the provision of other types of care which in all the circumstances ought to be provided by a registered nurse because they are ancillary to or closely connected with or part and parcel of the nursing care which she has to provide.

Q2: How robust are the assumptions mentioned at paragraph 7.4 of the Explanatory Memorandum? In particular the 3.1% efficiency expectation?

A2: The efficiency expectation is in line with the published NHS national tariff, which sets out the prices paid to NHS providers for commissioned services. Within this each year there is an overall uplift to account for increasing costs, as well as an efficiency factor to account for providers being able to deliver services more efficiently.

This is being applied to the FNC rate in the context of the LaingBuisson study which has shown that FNC costs have continued to increase at a sustained and above inflation rate since the last full study of FNC in 2016. Since 2016 we have also been using the pay component of the national tariff to apply inflationary uplifts to the FNC rate, so we believe it is appropriate to now accompany this with the efficiency factor. Whilst we appreciate that these efficiency asks will be challenging for nursing home providers, we believe they are achievable within the overall increase to the FNC rate of 4.7%, which remains a substantial increase.

Q3: If these amounts were last upgraded in 2018 what is the justification for an above inflation increase of 4.7%?

A3: Because the FNC rate is based upon the LaingBuisson study, which has shown a larger than inflation increase in costs. The FNC rate must be based upon the best available evidence to the Department of Health and Social Care, and the study is that evidence. Whilst in previous years only an inflationary uplift is applied, we have committed to undertaking a full cost study of the FNC rate at least every 5 years in order for it to remain accurate and in line with changes in the nursing home market. This year the study was also undertaken due to the Supreme Court judgment in Wales, and any potential impact this might have on the FNC rate in England.

1 May 2019

3 See: The Supreme Court, R (on the application of Forge Care Homes Ltd and others) (Appellants) v Cardiff and Vale University Health Board and others (Respondents): [accessed 8 May 2019].

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