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CCG funding formula to be revised, Commissioning Board promises

All rewards and sanctions for commissioners to be reviewed

Caroline White

Tuesday, 18 December 2012

The formula for calculating the cash that CCGs will be able to spend is to be reviewed, the NHS Commissioning Board (NHS CB) has announced. But the revised allocations won’t take effect until 2014-15.

In planning guidance issued today, setting out the incentives and levers for the NHS to deliver service improvements in 2013-14, the Board states that the formula proposed by the Advisory Committee on Resource Allocation (ACRA) while accurate, may disfavour areas that already have poor outcomes.

The ACRA formula “accurately predicts future spending requirements of CCGs based on the pattern of need as it is being met from that particular budget,” it states.

But it goes on to say that “it is concerned that use of the formula on its own to redistribute funding would predominantly have resulted in higher growth for areas that already have the best outcomes compared to those with the worst.”

It says that this contradicts the Board’s stated aim of improving health outcomes for all patients and striving to narrow health inequalities, and will therefore “conduct an urgent, fundamental review of the approach to allocations.”

It promises to complete its deliberations in time for the revised allocations to inform CCG funding for 2014-15, promising in the interim, “a real terms uniform increase in funding,” for the first year that GPs will be at the helm of the NHS.

The money allocated for commissioning budgets for CCGs and local authorities across the country will be £65.6 billion—an overall increase of 2.6% on what had been planned.

CCGs who take responsibility for secondary, community, and mental health services will get £64.7 billion of this, with each CCG expected to get 2.3% more in funds than their PCT received in 2012-13. The NHS CB will itself get £25.4 billion to commission specialist services.

Other key promises include:

  • Commissioners will have to publish progress against five key areas from preventing premature deaths to protecting patients from avoidable harms
  • From next summer providers will have to publish league tables of consultant care covering survival rates and quality of care in 10 specialties, including cardiac, vascular, and orthopaedic surgery
  • Access to routine services 24/7: a forum will look at how this can be achieved and report back by  next autumn
  • The payment of a quality premium to CCGs that improve or achieve on four national or four locally agreed measures
  • A fundamental review of incentives, rewards and sanctions available to commissioners
  • The ability of patients to feedback on any service in real time by 2015, with commissioners having to prove that they have responded.

Chief executive of the NHS CB, Sir David Nicholson said the NHS could be justly proud of its achievements, but that it couldn’t rest on its laurels.

“There are big challenges—not least the financial backdrop—but we must be ambitious. We want to make the NHS the best customer service in the world by doing more to put patients in the driving seat.

“We are determined to focus on outcomes and the rights people have under the NHS Constitution, as well as ensure those most in need gain most from the support we provide.”

BMA Chair of Council, Dr Mark Porter, said the guidance was “extremely ambitious,” given that the NHS was in a period of major structural change and continuing financial pressure.

“While many of the aims are laudable, new clinical commissioning groups (CCGs) will have the very real challenge of putting these aspirations into practice,” he said.

“The BMA backs improved access to health care for disadvantaged groups. However, we are concerned that the quality premium could exacerbate health inequalities, as CCGs in deprived populations could find it more difficult to achieve any financial award available. We therefore remain opposed to the quality premium as currently proposed.”

He continued: “While we are committed to improving services at weekends and in the evenings, today’s proposals to provide routine NHS procedures seven days a week are too crude and fail to take into account the resources, investment and flexibility that will be needed to achieve this.”

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