Councils and the NHS are being urged to make service user experience the starting point for constructing their joint financial arrangements. Helen Mooney explains

Councils and NHS organisations need to work much more closely together to focus on outcomes for patients and service users, rather than simply concentrating on joint financing arrangements. This is the stark message from the Audit Commission in its recent report Means to an End: joint financing across health and social care.

Pooling funds can secure improved services for patients and those in need of social care, but often the actual financial arrangements can become the focus of attention

According to the commission, instead of concentrating on the mechanics of joint financing and the processes of partnership, councils and the NHS should look at how their joint funding can improve people’s lives.

Audit Commission chair Michael O’Higgins says: “Councils and their healthcare partners must agree what they want to achieve through joint funding.

“Pooling funds can secure improved services for patients and those in need of social care, but often the actual financial arrangements can become the focus of attention.”

He also warned “joint funding should not be happening just for the sake of it”.

At present the most common formal arrangement is the pooling of functions and resources under section 75 of the NHS Act 2006. Pooled funds are mainly used for learning disability, community equipment and mental health services, but rarely for older people’s services. Where joint arrangements are in place the desire to improve service users’ experience is often the driver.

Outcome measures

The Audit Commission report warns although organisations can usually describe how they now work better together they cannot often say how they have jointly improved user experience. Partnership agreements often fail to include quantifiable outcome measures, and partners rarely monitor them when they do.

The commission recommends partners routinely set agreed performance measures, carry out an annual review that includes an evaluation of performance against these and review targets and priorities for the forthcoming year.

It says that where partners have understood the options and use section 75, pooled funds are critical to the seamless delivery of integrated services and that they are preferable to aligned budgets where a service is completely integrated - where its strategy and outcomes are agreed and it is commissioned as a single service.

Shared protocols

Integrated services also require joint approaches to data collection, information sharing, record keeping and management information to inform commissioning and expenditure decisions. However, alignment and synchronisation of data systems is not always easy in practice. As a minimum, partners should ensure that protocols on each of these aspects are incorporated

into agreements, relevant contracts or service level agreements.

Regulations specify that partners using Health Act flexibilities must sign a written partnership or joint funding agreement. It may look like added bureaucracy but these agreements are essential to mutual understanding and clear accountability and governance arrangements.

They can also help to avoid acrimony if the arrangement is dissolved.

Key recommendations

Local NHS bodies and councils should:

  • Review their current joint financing arrangements to ensure that they are fit for purpose and use the most appropriate funding and legal framework
  • Draw up written joint funding or partnership agreements, and regularly review these in light of performance and changing circumstances
  • Set and monitor measurable outcomes for service users for all their partnership agreements
  • Develop clear and synchronised financial frameworks that cover, for example, budget -setting, governance, financial planning, financial timetables and risk sharing

Case study: untangling the use of health act flexibilities in Westminster

City of Westminster Council and NHS Westminster work closely in delivering adult and children’s services.

Many of their existing section 75 arrangements were the result of a combination of historical factors and incremental decisions, so when some these agreements were set to expire both organisations hired an external project manager to review the partners’ existing joint agreements for adult services and set up a common framework under which all future agreements would operate.

All joint commissioning arrangements for services are now in one agreement, under which schedules have been created for each care group.

From April 2009, the agreement covered services for mental health, learning disability, older people, physical disability and substance misuse. A new partnership management group has also been set up to oversee implementation and to review outcomes of the agreement.

NHS Westminster chief executive Michael Scott explains successful partnership working needs more than “just good will”.

“We wanted to give a firm foundation for future partnership working and needed to get the clarity, processes, structures and funding in place,” he says.

Mr Scott says it is important to think about what the client wants and needs in the first instance rather than what is to the benefit of the organisation, to then get the foundations right in terms of financing and legality and to focus on the outcomes of the partnership.

Source: Means to an End: joint financing across health and social care

Joint spending needs agreed measures

  • NHS net outturn - £86.4bn
  • Adult social care net spend - £13.1bn
  • Joint expenditure on health and social care (formal) - £3.4bn

Source: Audit Commission (data from DH Departmental Report 2009, PSSEX1 2007-08, DH notification register 2008, Audit Commission pooled fund survey 2008)