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A three pronged plan

NHS trusts have been given a month to produce plans for merging back-office and pathology services with their neighbours, as part of a three-pronged plan to bear down on this year’s provider sector deficit.

Leaders in each of England’s 44 sustainability and transformation plan patches will also be given until the end of July to identify any planned care services in their area that are heavily dependent on locum staff and could be merged or transferred to other providers.

The news came in a letter from NHS Improvement sent to every trust chief executive in England this afternoon.

The letter, from NHS Improvement chief executive Jim Mackey and chair Ed Smith, confirmed that the provider sector is on course for a deficit of £550m this year. It warned that this level of deficit makes “management of the overall NHS financial position very risky”.

It says NHS Improvement is aiming to get the provider sector deficit down to £250m this year through a combination of three measures:

  • bearing down on paybill growth in selected providers;
  • large-scale back office consolidations; and
  • the merger or transfer of “unsustainable” elective services.

However, Mr Mackey has dismissed rumours that NHS Improvement might “tear up control totals” and issue trusts with even more demanding financial targets. He told an HSJ/Capsticks roundtable that if someone had “[shaken] hands on a control total” he was going to abide by the agreement.

A permanent temporary problem

An HSJ investigation has found several CCGs which are subject to NHS England legal directions spent hundreds of thousands of pounds each on interim executives and directors last year.

CCGs put in directions are often required by the national commissioner to appoint turnaround directors, or have other executive appointments approved by it.

Our research suggests this approach is leading to groups appointing directors quickly to difficult jobs – usually interims through agencies or personal service companies at high pay rates.

Examples include Surrey Downs CCG paying £195,000 for an interim turnaround director in post for six months; NEW Devon paying £335,000 in 11 months for someone in the same role off-payroll; and an interim chief operating officer costing Bedfordshire £310,000.

HSJ editor Alastair McLellan tweeted that “this has got to stop”, and referred to an editorial from a fortnight ago calling for CCGs to be reorganised. He wrote then: “Many CCGs are not strong. As time has passed, finding good quality chairs, accountable officers and finance directors has become more and more challenging – which is why you end up with a tiny and struggling CCG spending £500,000 on two interim directors.”

HSJ readers were also annoyed with the high level of spending on interims. One wrote: “If the CCG leadership team can’t deliver then get rid of them and merge CCGs with those who can”, while another called the money spent on interims “a scandal”.

But merging isn’t only an option for struggling CCGs. Last week, Aylesbury Vale and Chiltern CCGs in Buckinghamshire revealed they were targeting a merger, having already joined their leaderhsip teams, while HSJ has reported on three Birmingham CCGs’ plans to establish a “single commissioning voice” for the city.