Julia Simon: "STPs and ACOs: solutions for a 'bankrupt' NHS and social care system"?
Published: Friday, 02 December 2016 18:07
Written by Una
Talk given at the Learie Constantine centre, Dudden Hill Lane, on 1st December 2016 at the invitation of Brent Patient Voice to an audience of 50 people.
Dr Julia Simon was until Sept 2016 the head of NHS England's commissioning policy unit and its programme director of co-commissioning of primary care.
She had worked at London and national NHS level since 2012 on CCG and commissioning issues.
Dr Simon referred to a small number of presentation slides.
"There has been a split between commissioning and provision for over 25 years. The 2012 Health and Social Care Act aims to create a truly clinically led system with GPs in the driving seat. But the outcome is actually a fragmented commissioning system with three main budget holders across CCGs, NHSE and local authorities (public health), and a bewildering number of other national organisations.
In my view healthcare isn't a market: hospitals do not fail. They are always bailed out in order to give citizens care - which seems obvious. Andrew Lansley, the Secretary of State for Health responsible for the introduction of the HSCS Act, is married to a GP.
There were 212 in 2012 and there are 209 now. They are legally constituted by their members and all practising GPs must be members of one. CCGs have a statutory duty to (1) improve primary care and (2) to engage citizens.
The three commissioning bodies have different budgets. NHSE buys centrally for specialist and primary care. The CCGs buy acute care and elective care. The Local Authorities buy Public Health services (prevention and well-being). The trouble is that the incentives are not lined up correctly: the expense of commissioning public health services is born by LAs but they do not see the benefit - the CCGs do instead (eventually!)
To remedy these mismatches, the Five Year Forward View focusses on three gaps, and every one of the bodies involved in the Health system has signed up to this analysis and proposed solutions. The gaps are:
- Health and Wellbeing gap: evening out and upgrading public health education and prevention measures
- Care and quality gap: improving access to care and addressing inequalities in healthcare across the country (resulting in longer life expectancy)
- Funding and efficiency gap: the funding of the NHS under the present system is "spiraling out of control" and must be changed to prevent the NHS going bankrupt - STPs are a last ditch attempt
The gaps must be addressed on a system-wide basis. We need to develop new models of care that break down the traditional boundaries between:
- mental and physical health
- primary and acute care
- healthcare and social care
The aim is to create "integrated care", closer to home, etc....
In order to test out models the NHS has ordered "Vanguards" of "new care models". These are large-scale pilot schemes - but they have only been running just over one year (2015). There are 5 vanguards:
- Integrated, Primary and Acute Care System - PACS - bringing together GPs, hospital, community and mental health services
- Multi-specialty Community Provider - MCP- bringing specialist care out of the hospital and into the community, for example, continuing specialist care for diabetes, renal, etc.. with some specialised diagnostics
- Enhanced health care in care homes
- Urgent and emergency care - co-ordination of services
- Acute care collaborations: the aim is to improve clinical and financial viability by reducing variation in care and improving efficiency in hospitals. The Royal Free Hospital (CEO David Sloman) is leading a "hospital chain" (like schools) to raise standards and improve efficiency by adopting best practice.
These are all experiments. It is not yet possible to answer the questions: Do they provide better care? Do they save money?
Accountable Care (Accountable Care Partnerships, based on US Accountable Care Organisations):
These involve organisations, systems and "partnerships" with:
- capitated budgets
- responsibility (for how long?) for the care of a whole population e.g. the frail elderly, or Musculo-skeletal or diabetes
Dr Simon is going to Valencia next week to see the Accountable Care scheme in place there which is currently deemed successful.
In the USA ACOs are not always successful - there are some failing ACOs which have neither raised the quality of care nor saved money.
The commissioning is about to become even more complex, with some commissioning activity to be transferred onto the provider's books.
The new arrangements in ACOs present challenges including, in Dr Simon's view, the need for new legislation.
It is impossible to avoid perverse incentives in any imaginable system and so the new system will have new ones. The current system rewards hospital episodes (activity) whereas the new one will reward outcomes. But there is such a leap in changing from our familiar system based on national tariffs, the current regulatory and assurance frameworks, an (unhelpful!) national contract, etc...! She is sure that England needs new legislation to regulate these new arrangements.
Once again, the objective (incentive?) is to catch disease early and minimise acute illness (and high cost).
At Kaiser Permanent there is self-care: the patient becomes the expert (e.g. diabetes and COPD). You look after yourself with support. And the system is not going to pay for episodes of acute care [sic] (????) NHS senior management appears to believe - as Dr Simon tells it! - that hospitals want to secure acute episodes for purely financial reasons (e.g. £4000 for a hospital episode of care vs. £250 for a prevention strategy). [In this case it is not clear why hospital doctors are still practicing since tariffs for procedures have been reduced year on year by 3% for at least 5 years, largely from the salaries of doctors and nurses which comprise 70% of hospitals costs].
This wholesale change of incentives has been introduced far too quickly and with no transparency.
In December 2015 the NHS produced "planning guidance" (viz: mandatory instructions) to CCGs to prepare their draft STP by June 2016:
- prompted by the tacit recognition that CCGs are not able on their own to control costs that are spiraling out of control
- basic premise: there is one pot of public money in the "health economy", initially just for the health care economy - but the culture is not ready for this change and is not in place
- The STPs will be multi-year, place-based plans based around the needs of the local population
- New and energetic leadership: need to build capacity and capability of new leaders to support change
In summary: the NHS is "nearly bankrupt", has "run out of tarmac", "run out of road".....
In social care: There will be a £2.4Bn underspend next year.
Simon Stevens said: "Two leaky buckets do not make one sound bucket". The implication is that each part of health and social care will have to be "made sound" on its own.
Dr Simon has been supporting 2 or 3 STPs last week. It is not an easy task...
She summarised the situation as a "genuine chaotic mess", a "truncated process", "murky".... (Dr Simon looked stressed!)
She has no idea how the priorities in any given STP have been decided (1) by the CCGs, (2) on behalf of local patients, including in NW London!
"The greatest problem with this process is the lack of transparency". There is a legal requirement to consult for a minimum of 3 months - but we only barely have 3 months after 23rd December and before 31st March. It's not nearly enough time! It's a "twisted time-frame".
Challenges of the STPs:
- No statutory authority given to the STP lead
- lack of capacity, resource, capability of leaders
- challenging time-frame at a time of austerity
- going from a competition culture in the HSCA 2012 to a culture of "deep, instinctive collaboration" of STPs
- the existing national regulatory and assurance frameworks do not follow the STPs
- GP practices are currently independent organisations with statutory responsibilities.
- Most GPs are partners on a "for life" contract, or are employed on well-understood employment contracts
The ACPs require fundamental changes for GPs:
- All GPs will be employed on 5 or 10 year contracts
- Federation will take on "collective responsibility" for the STP "Control Total", i.e. their year's budget
- What are the sanctions if things go very wrong? This is not at all clear
She thought that one of the biggest problems with STPs (and ACOs) will be the in-built Conflicts of Interest. She helped to develop the first guidelines on conflicts of interest in the NHS in 2014. The NHS has published a new consultation document in September 2016 (https://www.england.nhs.uk/wp-content/uploads/2016/05/conflicts-of-interest-consultation.pdf)
Dr Simon was thanked for a very succinct presentation!
Questions from the audience:
Dr Robert Sale:
Isn't this a "back-door" way of bringing in insurance-based service? They are not bothered about the privatisation of GPs, but they want to shed the larger expenditure?
No, Dr Simon is against the "market" in health. She thinks it wasn't the NHS's intention to privatise. For example care homes are all in the private sector. She claimed that the "current climate does not pose particularly greater problems".... The "Vanguards" are all NHS bodies. She is not worried about a "completely commercialised NHS". However, there is a risk of purely commercial ACOs.
Kaiser is a Health Maintenance Organisation. Are we going to get that? They just throw you out of a hospital when your insurance money runs out?
Dr Simon didn't think so.
Dr Simon said: "Most of the STPs are "pants", "they don't hang together", they have "high-falluting language" but what is the content? "It's not a done deal yet". Jim Mackay, the head of NHSI, expects a "reboot" of the STPs after Christmas because of the lack of consultation. At that point he may say: "We can't fund what we funded before" and he may be upfront.
Dr Simon agreed that the transaction costs of the "internal market" in the NHS are ~£2BN per year. And the audience told her that the management consultants who prepared SaHF and the STP in NW London were paid £200M to date.
A young GP (James, a GP in Ealing):
ACOs will not be private companies (e.g. a Foundation Trust can keep and invest its own surplus), but might it include private organisations in itself? - interjection: "Brent Care Ltd"?
Dr Simon thought not.
Conflicts of interest: Dr Simon had doubts about whether they can be contained. If something goes wrong or is not affordable, what happens? There is a democratic deficit.
Dr Simon thinks that accountability has not been fully thought through. The regulation and accountability issues are so grave that writing an STP without these essential parts is like "building an aeroplane as we fly it!"
The STPs will be published on 31st March 2017.
Gaynor Lloyd (Brent Patient Voice):
As a solicitor specialising in commercial property she sees the ACPs as a legal can of worms: they cannot be set up in a proper way except, possibly, with vast armies of lawyers. For example the UnitingCare partnership in Cambridgeshire collapsed after just 8 months in 2015 because of carelessness in an apparently unimportant detail: some of the constituent organisations paid VAT and others didn't. This 20% difference in cost was an important fact which blew the contract up (see National Audit Office report https://www.nao.org.uk/report/investigation-into-the-collapse-of-the-unitingcare-partnership-contract-in-cambridgeshire-and-peterborough/).
Addressing the GP she asked: what legal advice were you and your practice given? And she mentioned that she had come across a Chair of a CCG who was "black-listing" (!) medications.
"I have not been given any useful advice". He knew next to nothing about ACPs. He asked: "How will GPs be part of ACOs? It seems that CCGs will be forcing GPs to take on new primary care contracts and to be employed by new bodies" [from a position of strength]
Dr Simon replied that there were a lot of legal costs, but GPs were free to opt in or stay out. Finally she conceded: "The answer is not there yet, but expect to see some kind of solution".
Robin Sharp (Brent Patient Voice):
(1) The savings proposed in the STP are so enormous that one could conclude that, to date, the system has been wasting enormous amounts of money for years. Why do we not see this waste? The proposals are so dubious that we have to ask: "Do we trust the figures?" His answer: "No, we don't".
(2) PFIs have been used to rebuild hospitals and schools using private sector money to create extremely profitable private contracts. It is profligate spending! If these contracts were bought out we would eliminate the deficit on the NW London STP. We are in a low-interest era: why can't we refinance the PFIs?
What work has been done to buy out PFIs?
Dr Simon replied that she could not answer the question. She agreed that PFIs are unaffordable.
Concluding the meeting Robin Sharp reminded the audience of George Orwell's "double speak": "Those who wrote the words don't believe them" "I don't have confidence in the numbers".
Dr Simon said that she didn't think that the parameters are the right ones. "I was personally not comfortable. There was a 'cognitive dissonance' with our leaders."
The greatest danger for GPs is as follows: "When you have 'market capture' of GP federations it will become impossible to run CCGs without conflicts of interest. That would be completely unmanageable. Therefore the powers of the CCGs would need to be given to another body"