By Richard Johnstone | 7 July 2014
Ministers have altered the rules governing the flagship Better Care Fund to allow it to support hospital services if local integration plans fail to reduce admissions.
The £3.8bn fund, made up of equal funding contributions from the NHS and councils, is intended to bring together health and social care provision to reduce pressure on hospitals.
But following a review of the plans, the Department of Health and Department for Communities and Local Government this weekend announced a revised implementation agreement.
Under the changes, Health and Wellbeing Boards, made up of councils and NHS commissioners, will set a local target for reducing the number of unplanned hospital admissions by at least 3.5%, or 185,500 nationwide.
Some of the £1bn of pooled BCF money will then be allocated against this target. However, if this is not reached, the balance will be used to support NHS-commissioned services, as agreed by the Health and Wellbeing Boards.
This revision to the BCF comes after the DoH denied reports earlier this year that the scheme would not be up and running by April 2015 as planned, in part due to the impact of pooling funds on hospitals.
New guidance for local areas to shape the development of local BCF plans, including the revised performance payment scheme, will be set out shortly.
However, ministers said they still expect the plans to be in place by next April, following a further process of national assurance and ministerial sign-off.
Announcing the updated plan, Health Secretary Jeremy Hunt said: ‘Local authorities and the NHS are making excellent progress in developing plans that will give patients better, joined-up care and allow hospitals to focus on treating the people who really need to be there.
‘Successive governments have talked about bringing the NHS and social care together for decades – this is the first, transformative step to making that a reality. We will continue to nurture and support the development of these plans to deliver our shared ambition so that every part of the country provides better care for patients closer to home.’
Local Government Secretary Eric Pickles added: ‘The great advantage of the system is local flexibility to get the mix of services right for the user. The revised plans will help cement this new partnership at a local level, with services built around the user, and provide a good deal for the taxpayer too.’
Responding to the announcement, Nuffield Trust policy director Dr Judith Smith said initial BCF plans were based on unrealistic assumptions about the in-year savings that could be achieved by reducing emergency admissions to hospital.
‘It is therefore good to see that the government has listened to the concerns we and others raised about the impact the fund could have on hospital finances in 2015/16, which is looking to be a crunch year for the NHS,’ she added.
‘But we should be under no illusion: the task ahead is not an easy one. The revised plan assumes reductions in emergency admissions of 3.5%, which would require local authorities and the NHS to buck a long-term trend.’
This change could therefore be destabilising for local authorities at a time when they are already under intense financial pressure, she said.
‘Because this latest change to the Better Care Fund requires local authorities to transfer money back to the NHS if emergency admissions are not reduced, it is likely that they will find themselves on the hook to hand up to £1bn back to the health service in a single year.’
Fourteen areas have been given permission to fast-track implementation of the BCF. In other cases, revised plans will be examined by DCLG permanent secretary Sir Bob Kerslake and NHS chief executive Simon Stevens later this summer to ensure every area is on track ahead of next April’s implementation date.
The 14 areas that can fast track their BCF plans are:
Dudley
Hammersmith & Fulham
Kensington & Chelsea
Westminster
Greenwich
Leeds
Liverpool
Nottinghamshire
Reading
Sunderland
Rotherham
Torbay
Warwickshire
Wiltshire
