NHS planning guidance to create local area spending totals

23 Sep 16

New spending limits for regional health systems have been proposed in a two-year blueprint for the NHS, which expands the use of Sustainability and Transformation Plans to drive reforms across the service.

The Delivering the Forward View operational planning guidance for 2017/18 and 2018/19 also included new incentives worth more than £100m to help tackle unnecessary delays in discharging patients from hospital, and to reduce the number of people attending A&E with mental health problems.

The plan, developed by NHS England and NHS Improvement, is intended to strengthen collaboration across the NHS and ensure that local health and care areas are successful in delivering their STP blueprints. These, which are currently being developed, bring together health and care leaders, organisations and communities to develop local proposals for improved health, care and finances in 44 regional areas, known as footprints.

The operational plan, published yesterday, states that each STP area will be able to apply for their own system-wide financial control totals. This is intended to make it easier for them to pool resources across organisations and shift money to support improvement of care and the redesign of services.

NHS England chief executive Simon Stevens said the plan would support collaborative action across the health service to deliver improvement in areas including cancer, mental health, learning disabilities, primary care and urgent and emergency care.

NHS Improvement chief executive Jim Mackey added that, following the £2.45bn deficit in 2015-16, the NHS had “a real challenge on its hands”. The action set out would help the service meet the needs of patients well into the future, he added.

“Two-year operational plans, based on the Sustainability and Transformation Plans already being developed in each local health system, will create much greater stability and certainty for providers and the local communities they serve,” he said.

“Making sure that providers and commissioners can work together to provide high-quality care, within the resources available to the NHS, is central to getting the most out of the opportunities set out in this joint planning guidance.”

The organisation-specific and system control totals will be the key financial performance measures for STPs. Areas are required to submit local financial plans showing how their systems will achieve financial balance within the available resources. “We expect both the commissioner sector and the provider sector to each be in financial balance in both 2017/18 and 2018/19,” the report stated.

The STPs will be reflected in individual organisational plans, with aggregate financial activity and workforce plans at an STP level as well as the sector-wide financial control totals.

Jane Payling, the head of health and integration at CIPFA said today’s guidance would likely be welcomed by the NHS. “The move to two-year contracts and planning, along with earlier guidance and contract deadlines, should ease pressures on finance teams. It should also give organisations the opportunity to closely align with their STP partners including local authorities, whose role has been emphasised.

“The role of Sustainability and Transformation Plans will be cemented further as they will be given responsibility for the system control total. To ensure strong governance and that they work effectively within local systems, there will need to be more national guidance.”

Payling highlighted that after many years of tariff deflation, tariff uplifts of 2.1% for the next two years would also be welcomed. However, this comes as the NHS will have to cope with an increase in cost pressures, so even the ‘relentless focus on efficiency’ required by the guidance may not be sufficient to achieve financial balance, she added.

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