The Director of Strategic Planning and Performance at STCCG was in attendance to provide an overview of the health service commissioned provider contracts due for renewal in 2018/19 to 2020/21.
Prior to discussing the contract renewal arrangements the Chair requested that a brief update be provided to the panel in respect of STCCG's financial position. The Director advised in 2018/19 the organisation was required to save £20m and to provide some context to that level of saving it was advised that STCCG's annual budget was in excess of £460m.It was explained that traditionally CCG's would make efficiency savings through demand management, whereby patients who genuinely needed access to services were given access and individuals whose needs could possibly be better met through other means were directed to access other support. For example, if there was no clinical benefit in an individual having an outpatient appointment or clinical procedure undertaken then the CCG would encourage suitable alternatives that might better meet the patient's needs, whilst also reducing the CCG's spend. However, there were also opportunities when contracts came to an end to review whether or not there were better and more cost effective ways of delivering those services.
The CCG Director explained that one of the questions he had been asked in advance of attending the meeting was if he was able to provide an overview of the contracts that the CCG held that were coming to an end. The panel was advised that the majority of contacts were in place for between 1 and 3 years, the CCG's contract register was published on the CCG's website. There were hundreds of contracts and it would not have been practical to take the panel through all of those contracts. However, the information was publically available for Members to access. When contracts came to an end there was an opportunity to have a conversation about whether a different set of services could be put in place. Tools such as the JSNA, feedback from patients, service providers and groups such as Overview and Scrutiny were taken into consideration when reviewing service provision.
Reference was made to the recently signed aligned incentive contract between STCCG and South Tees Hospitals NHS Foundation Trust and the Chair emphasised that the panel was focused on the services that fell outside of that block contract. The CCG's Director acknowledged that JCUH was the biggest provider but there were a range of other providers from which services were commissioned including both the independent sector and the VCS. It was acknowledged that when contracts were due to expire the CCG would review the service and although there may have been occasions in the past where those reviews may not have not been as open and transparent as everyone would have wanted the CCG would never willingly go out and make changes to service provision without undertaking a formal engagement process.
In terms of fragile and vulnerable services the CCG Director expressed the view the use of this terminology meant different things in different forums. Across the North East at the moment rheumatology and breast services were perceived as being fragile services. These services were fragile, not because commissioners did not want to commission them, but because providers did not necessarily have the trained staff available to provide these from all of the locations from which they were currently delivered.
The Director of Social Care Integration expressed the view that there were a couple of different ways of thinking about fragility. If you were in a position of financial deficit then that brought a certain degree of jeopardy about all services that you could deliver across the board. There was also difficult dilemmas around where there were services that you knew you statutorily had to provide and others where you might be providing more than absolutely required to in law. As a local authority the Council was not immune from those difficult dilemma's either.
The Chair posed the question as to what those difficult dilemmas for STCCG were and where would the organisation need to trim back on service provision to what was statutorily required. The Director expressed the view that it was not all 'black and white' and instead the CCG were looking at areas where there was a potential that the CCG was duplicating provision through a range of different contracting arrangements. It was explained, for example, that the CCG had a block contract in place with TEWV, the mental health service provider. However, the CCG also funded individual packages of care that were in place through Continuing Health Care (CHC) where the CCG worked with local authority colleagues around understanding an individual's needs and then funded the care to meet those needs. There were times when the package of care put in place duplicated a service that the CCG commissioned through its block contract arrangements.
In terms of contracting it was explained that the CCG predominately used the single contract framework, which was an NHS standard contract used nationally. If key performance standards were not being met through a contract there were mechanisms in place to introduce break clauses. The CCG could issue 6 / 12 month notice periods, whereby if a provider was unable to recover their performance the contract would be revoked. Reference was made to the recent significant safety concerns around the out of hours service, where the CQC had flagged concerns, and it was explained that the CCG had worked with the provider ELM Alliance to improve the provision. In doing so the CCG had issued a contract notice and had the provider been unable to improve the offer to patients the contract would have been withdrawn. The CQC had since revisited the out of hours service and significant improvements had been made.
A member of the panel expressed the view that the panel's overriding concern was in respect of the 'bottom line'. It was evident that £20m worth of funding would be taken out of our local health and social care system by March / April 2019 and the question for the panel was how would achieving those target savings impact on the individuals Middlesbrough Councillors represented. Was the approach being taken one whereby the CCG cut a fraction from a whole range of different services or would large savings be made in certain areas, where perhaps a service would be lost to save in the region of £5m rather than shave off smaller amounts across a number of areas? Would more savings need to come in place from 1 April 2019 and if so had those plans been made, given that the CCG was already 7 months into 2018/19?
The CCG's Director advised that the CCG had been required to produce a financial recovery plan on how it would balance the books and it had been agreed with NHS England that STCCG would close the year with a deficit. The CCG would still spend more than its allocated fair share funding but would gain access to a national pot of funding - the Commissioning Sustainability Fund, which would assist the CCG in getting through the financial year. If the CCG was successful in not overspending by more than £5m NHS England would provide the CCG with additional resources to cover the shortfall.
In terms of the savings made to date £8m the bulk of those savings had so far been achieved through the signing of the aligned incentive contract, of which the annual value was £228m. The remainder would be achieved from a number of different areas including prescribing waste. The panel was informed that STCCG spent more on prescribing in 2017/18 than any other CCG in the North East of England. STCCG therefore needed to look at whether these prescribing levels were appropriate and if patients were being prescribed drugs whether they were making use of them. The CCG's expectation was that £4m could be saved from the prescribing budget in 2017/18, although it was hoped that up to £6m could be achieved.
The panel was informed that the remaining savings need to come from a range of different areas. For example, STCCG invested more in primary care than any other CCG in the North East, which included the recently established out of our hours hubs. Continuing Health Care (CHC) spend had also continued to increase and growth in CHC costs was outstripping savings achieved in other areas.
In response to a query it was explained that there were different elements to CHC but fundamentally it was about the total cost of health and social care services that supported an individual. It was acknowledged that although there were disagreements at times between the CCG and the local authority in respect of CHC, a legal framework in terms of eligibility had to be worked through. The Chair queried the figure that the CCG anticipated saving from their CHC budget in 2018/19. It was advised that the CCG was intending to achieve savings of around (£4m).
A member of the panel queried whether a counterargument had been put to NHS England STCCG in terms of its funding allocation. The Director of the CCG advised that the CCG had explained to NHS England that it had not been possible it to provide all of the services it was legally required to provide within the resources the CCG had been allocated. There had been an acceptance from NHS England that STCCGs expenditure in response to identified needs was in effect £4m less than its fair share allocation. The remaining savings balance of £4m would therefore be drawn from NHS Englands Commissioning Sustainability Funding.
The Chair queried the areas of disagreement between health and social care services. The Director of Adult Social Care and Health Integration made reference to section 256 arrangements, which were agreements whereby the CCG had a contract with the Local Authority for it to commission services on its behalf. Various arrangements were in place and the initial action taken by the CCG in respect of reviewing those arrangements had been less considered than it may have been. However, the narrative had really changed in the last few months and health and social care had been working much more closely together. The real concern remained as to whether STCCG would make sufficient progress to access the Commissioning Sustainability Funding. It was emphasised that health and social care need to work collectively to pull in this £3.7m of funding. In terms of progress towards the target the Director at the CCG advised that from the information he had received the CCG was on track to make the necessary savings.
In response to a query regarding the possibility of funding duplication for mental health services it was advised that STCCG had made a commitment to extend IAPT services, and although the CCG was not investing in many areas it was investing in mental health and supporting more people to deliver access such as IAPT. The point was made that the uptake for IAPT service had never been what it needed to be and as many people as possible who were suffering with anxiety / depression needed to access the system in order to help reduce over prescribing.
The Director of Public Health also made the point that although investment in prevention did lead to better outcomes the current risk was that more preventative services had to be cut in an effort to balance the books in the short term. It was advised, for example, that a service operated by Change, Grow, Live at JCUH to provide additional support to those experiencing substance misuse issues, who were accessing A&E services as a result of those issues, was under threat due to cuts in Public Health Funding.
AGREED that an invitation be extended to the local medical committee and local pharmaceutical community, to attend a future meeting of the panel to discuss the issue of overprescribing.