CCG mergers - will there be a flurry or a snowstorm?

You wait four years for a clinical commissioning group merger and then six come along at once (OK, there were Newcastle and Manchester, but they were the exceptions proving the rule that mergers were not allowed).

The change of mood – flagged first by HSJ last year – was quite a turnaround from Simon Stevens.

The question arises whether it will lead – as the NHS England chief executive previously warned – to other CCGs spending their time eyeing each other up. Will this behaviour, and any union it may lead to, be tolerated, encouraged or even required by NHS England?

Looking at the facts of what has happened so far might give us some clues.

The story so far

First, there still aren’t that many mergers going on. Assuming the current tranche go ahead then about one in 10 of the original 211 commissioning groups will have merged.

NHS England has backed and encouraged mergers where there is trusted senior management and a coherent plan behind it.

But there is not a simple formula: two of the new mergers are to full STP boundaries, two match “accountable care systems” but not their STP, one covers Leeds (neither an STP nor ACS but a city with good system leadership) and one is a part of the Frimley ACS.

Except for the Bristol area, the merging CCGs are not basket cases and the tie-ups have not been forced on them. Instead, the trigger is acceptance that the CCGs separately aren’t up to the severity of the challenge of keeping their area’s NHS afloat, nor matched to the slow but significant evolution underway in clinical and business models.

However, the real rush to CCG consolidation has not been through formal merger. It is via moves to shared accountable officers (aka chief officers) and – though it is a grey area – other shared management and governance.

Here there has been a rapid seachange. There will very shortly be at least 100 CCGs with shared chief officers (out of the current 207, due to fall to 195 in April) – doubling in little over a year, by my estimation. 

The mean average CCG population is about 280,000; the mean population covered by a chief officer is now 420,000. A key question is whether CCGs sharing management will now convert quite rapidly into full mergers.

More so than mergers, this has hit the most troubled CCGs list, members of which have often been given very little choice but to move to shared leadership. Recent examples include two counties at the bottom of the STP class, Sussex and Staffordshire.

(Side note: There was substantial improvement in CCG ratings this year. As well as CCGs’ hard work I expect some of that was down to spreading and sharing good senior management, and to very proactive intervention by NHS England, particularly to financial problems).

A final observation on consolidation so far: lots has changed but a lot remains untouched. We are still a long way from the simplified, health authority style map that some are dreaming of. 

Nearly half of CCGs do not have shared chief officers. Ten STPs have five or more chief officers within them, 23 top tier local authorities have more than one chief officer on their patch, and there are 25 CCGs with a population of less than 200,000 that are not sharing a boss.

The South East has normally had a finger wagged at it when it comes to fragmentation and, despite some movement, it still has quite a few separate accountable officers. But the region with the smallest proportion of shared AOs – and the smallest average population per AO – is the North, perhaps linked to large numbers of small-ish unitary local authorities and a number of STPs too big to easily make the leap.

Where next?

I pointed out in May that the legislation-light policy option for simplifying decision making and reducing transaction costs was to force through mass CCG mergers. With legislation off the table it might be the only option.

The number of CCGs sharing chief officers can be expected to keep growing quickly, encouraged from the centre and – in cases of failure – more or less forced.

Assuming all goes well in places like Berkshire and Leeds, others will see the sky has not fallen in, it could make life more straightforward, and that merger can bring sweeties from NHS England. This will result in a flurry more opting to join-up but, in itself, no more than that.

The centre will put further energy behind “accountable care systems” and underline that the direction is consolidation - but quite how explicit it will be remains to be seen.

Some anticipate another big bite being taken out of admin cost allowances in the budget - a hard material factor that could yet turn the flurry into a snowstorm.

Updated on 16 November.