The must-read stories and debate in health policy and leadership.

NHS England’s finance boss has written to local trusts warning the service “must live within its government-mandated spending limits”.

Julian Kelly unveiled a new set of incentives for balancing the books – with penalties for organisations that spend more than their “fair share”.

Mr Kelly’s intervention – which comes two months into the financial year – is a sign of the increasing nervousness at the top of NHSE as it struggles to fill a £3bn gap for 2024-25.

The new guidance, seen by HSJ, admits that “financial recovery in all systems is not possible in a single year”.

NHSE will be hoping the new regime of targets, rewards and penalties will help chart a course back to sound budgets.

A similar approach was attempted in 2016, in which providers were given “control totals” and offered incentive payments to balance the books, although the National Audit Office found it did not address underlying financial sustainability.

As Nuffield Trust senior policy analyst Sally Gainsbury said funding was “unrealistically low”, adding: “NHS England really is between a rock and a hard place this financial year… the best NHSE can hope for is to try and avoid making a bad situation even worse.”

Caring is acute and community sharing?

The emergency care crisis has precipitated a rapid reassessment of two community trusts in the North West, where the neighbouring acutes consistently struggle to discharge patients.

Bridgewater Community Healthcare has been pressured into integration and merger talks with Warrington and Halton Hospitals, while Wirral’s small community provider now looks set for a similar path with Wirral University Teaching Hospitals.

Wirral Community Health and Care Foundation Trust has not advertised its CEO post since long-serving chief Karen Howell announced her departure in March, and HSJ has learned that Cheshire and Merseyside Integrated Care Board has commissioned consultancy firm The Value Circle to look at the borough’s provider landscape.

Well-placed local sources said this would likely result in a joint CEO post with WUTH, eventually leading to an organisational merger in the longer term.

The region’s two community trusts have looked increasingly out of place in an NHS which is trying to break down the bureaucratic dividing lines between services, while the acute trusts and their commissioners feel that having control of the services will help lessen their discharge problems.

Also on

Independent Healthcare Providers Network chief executive David Hare has described Greater Manchester Integrated Care System’s plan of curbing its use of the private sector as making “no sense”. Meanwhile, NHS Confed’s Integrated Care System Network chair Kathy McLean has called on policymakers to “keep the faith” in ICBs. And this fortnight’s The Integrator delves deeper into Labour’s pledged push towards shared staff and waiting lists.