Two clinical commissioning groups in Nottinghamshire faced up to the daunting population changes and resource challenges affecting much of the UK by moving to capitated outcomes based commissioning, writes their chief officer Amanda Sullivan

Shaking hands


Like most CCGs across the country, mid Nottinghamshire CCGs were bleakly facing the “graph of doom”, namely, an ageing population, overstretched services, increasing demand and growing complexity.

The line on this graph was steep, too, with a potential funding gap of £140m over 10 years.

‘All of the service solutions required deep integration between health bodies and health and social care organisations’

Newark and Sherwood CCG and Mansfield and Ashfield CCG have an annual budget of nearly £400m. Their population of 310,000 is served by 42 general practices, one major foundation trust (with 80 per cent of the acute activity), and a single provider of mental health and community services, with limited “leakage” to other out of area providers.

The county council is responsible for public health and social care commissioning and the two CCGs have an integrated leadership team – for example, the chief officer role, held by Amanda Sullivan, is a joint post – but separate governing bodies.

Working with patients, the public, all commissioners (health, social care and public health), professionals and the third sector, they embarked on a journey to redesign a high quality, sustainable service solution.

Blueprint for better care

The result was a detailed “blueprint” focusing on services that delivered better health and social care outcomes, and which offered an improved experience to service users.

Readers of HSJ’s Resource Centre will not be surprised by the outcome of this work, features of which included:

  • a community based proactive care team, focused on frail elderly dedicated to keeping people well at home;
  • integrated urgent care to actively manage entry into and exit from the service; and
  • discharge to assess: a service to manage the elective care pathway and discharge process, so that people are only in hospital as long as they need to be and are actively enabled to get home.

‘Commissioners were agnostic about any future organisational form’

All of the service solutions required significant investment – both time and money – and deep integration between health organisations and health and social care organisations.

The challenge for the CCGs was how to drive whole system transformation from a fundamentally activity based, cost and volume model to one that focuses on patient outcomes and experiences.

Whole population approach

The bounded nature of the population and providers, the drive for service development in response to patient outcomes and a new focus on early intervention and prevention led the CCGs to develop a whole population, capitated outcomes based approach to recommissioning.

The core components of the approach include:

  • the contract being let to a single “accountable provider organisation” that will be responsible for providing or coordinating all the care – defined by the scope of services and outcome framework – for our population over the contract term. The accountable provider organisation could be a single organisation or multiple organisations that have come together as the contractual counterparty;
  • outcomes based payment to the provider(s) that will, in part, be based on meeting a set of patient centric outcomes. The objective is to shift service planning and delivery away from traditional activity based, provider orientated intervention models towards patient centred, outcome focused preventative models of care;
  • commissioners moving away from payment by results towards a capitated budget for the population. This, combined with the outcomes based contract, will incentivise providers to invest proactively in maintaining the health and wellbeing of the population; and
  • a longer contract: to allow the accountable provider organisation to demonstrate improvement in patient outcomes, the contract duration is likely to be longer than traditional contracts and potentially 10 years.

The commissioners are, of course, bound by procurement law and competition legislation. When recommissioning such a significant scope of health and care services they could reasonably be expected to compete the contract to demonstrate that they have stimulated innovation and have achieved best value.

Steps to improved quality

However, the commissioners critically reviewed their options and agreed that they should consider whether local providers were best placed, or the “most capable provider(s)” to deliver improved value and quality through an integrated service solution.

The key steps were to:

  1. identify the organisation(s) that would coordinate a response;
  2. initiate capability assessment 1: a two part test of the coordinating providers designed to evaluate the ability of these organisations to work together on challenges they are currently facing in the health economy. In summary, the first capability assessment includes governance arrangements of the coordinating providers and delivering real system benefits – preventing admissions and reducing length of stay – as agreed as part of the better care fund and system investments already in place by the commissioner; and
  3. initiate capability assessment 2: coordinating providers will be required to prepare a proposal for a programme of integrated service transformation – with appropriate links to workforce, IT, estates and patient engagement – to sustain the health economy in the near term. The coordinating providers will also be able to comment upon the outcomes and capitated based contract determined by the commissioners through a managed discussion process.

Assessment criteria

In mid Nottinghamshire, there was not a single provider that the commissioners could identify to lead this capability assessment process, so they reviewed all of their incumbent providers and assessed them against the following criteria:

  • Regulatory: does the provider(s) meet the required legal and regulatory requirements to deliver the services?
  • Capability/means of production: does the provider have the necessary infrastructure (facilities, premises, equipment, staff etc) and/or capacity to provide the services in question?
  • Service range: does the provider currently offer core services that meet a broad range of needs across one or more of the three service areas (proactive, urgent and elective)?
  • Scope: does the provider have substantive experience of delivering core services in one or more of the core areas being commissioned?
  • Population: does the provider serve a significant portion of the local population?
  • integration: is the provider essential to avoid clinical fragmentation of existing pathways and/or is any particular provider already delivering services in an integrated way?
  • materiality: is the provider substantially important to the effective provision of elective or non-elective health and/or social care services to the local population, and/or does any particular provider need to maintain a certain volume and case mix in order to provide safe and effective services?

Coordinating capability

Through this process seven providers were identified to act as the coordinating providers. The role of the coordinating providers is to collectively respond to the capability assessments.

The commissioners were clear that the role each organisation would play in the process could – and perhaps should – be different. Indeed, the commissioners did not want to influence this decision, which was to be determined by the organisations themselves.

‘There is a single contractual counterparty that will be held accountable for delivery of a range of outcomes’

The coordinating providers may also identify other providers or organisations that would, or could, play an important role in delivering an integrated service solution for commissioners, for example, an IT delivery partner.

Furthermore, the commissioners were agnostic about any future organisational form or the role any single organisation would play in future commercial arrangements. For example, one organisation could take on the role of prime contractor, with the others as subcontractors in the care delivery chain, or two or more of the organisations may form a contractual joint venture sharing the risk and benefits associated with service redesign and delivery.

Contract accountability

What is important is that there is a single contractual counterparty that will be held accountable for delivery of a range of outcome measures for the population and will hold the capitated budget. This contractual counterparty will be the accountable provider organisation.

‘These aren’t new challenges, but the process has brought providers together with a new focus’

The intended benefits of the process are to keep providers focused on the challenges we face today, while driving them to develop a future integrated model of care. This process is now well underway.

Capability assessment 1 has been published and there is good evidence that the coordinating providers are working well together.

These are not new challenges (preventing non-elective admissions and reducing length of stay), but the process has brought providers together with a new focus – reaching out to GPs and social care organisations to develop provider led service solutions.

Amanda Sullivan is chief officer of Mansfield and Ashfield, and Newark and Sherwood CCGs