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New funding plans will drive NHS integration

Capitation model will enable hospitals and community providers to deliver new models of care, says Simon Stevens

Mark Gould

Tuesday, 02 December 2014

NHS chief executive Simon Stevens says radical changes to the NHS funding and payment systems, published today, will drive forward plans for better integration between hospitals, primary care and community services.

He says the use of so-called "capitation" payments to NHS providers – bringing hospitals, community and mental health into line with the way GPs are funded – would particularly benefit the frail elderly and those with multiple care needs, such as the 17 million people with long-term conditions. Under the capitation system GPs are allocated funding and payment based on patient numbers adjusted for population characteristics such as age or levels of deprivation.

NHS England and the Foundation Trust watchdog Monitor say universal extension of capitation will enable the NHS to introduce new models of care. This would enable the NHS to put into practice its long-standing commitment to better integrate hospital, community and mental health care, and provide a payment system to help introduce the examples of care models outlined in the Five Year Forward View launched in October 2014.

Monitor and NHS England want commissioners and providers to adopt this new payment model when negotiating the local price-setting arrangements. The organisations propose such arrangements should increasingly become the norm under reforms to the national tariff, which would see it "become a framework of rules, rather than just a list of prices".

Simon Stevens said: “NHS payment systems are a means, not an end. Much of the current tariff system was designed to help the NHS achieve a set of goals in the 2000s, such as slashing long waiting lists for routine surgery, which have been achieved. The new challenge is to support the triple integration of care the Forward View highlights: between primary and specialist care, physical and mental health services and health and social care. Today we signal a new, locally flexible direction of travel to advance these goals."

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