HSJ Catchup: Virgin Care legal action, CCG mergers and offsetting the deficit

Private provider takes action against NHS

Virgin Care has launched legal proceedings against eight NHS commissioners after losing a bid for an £82m children’s community services contract.

The company issued court proceedings in the High Court against NHS England, Surrey County Council and the county’s six clinical commissioning groups one month after commissioners awarded the three year contract to Surrey Healthy Children and Families Services LLP.

A spokesman for Virgin Care told HSJ that concerns about “serious flaws in the procurement process” prompted the company to launch proceedings.

Total £800m fund will be used to offset deficits

There was confirmation this week of what has been widely predicted for months – that the entire £800m contingency fund held back from commissioning budgets will have to remain unspent by clinical commisioning groups in order to balance the stubbornly large deficits in the provider sector.

In a letter, seen by HSJ, Paul Baumann, chief financial officer at NHS England, wrote: “The aggregate effect of this will be to increase the surplus across the whole of the commissioning sector by around £800m, which will help to offset the provider deficit position and help to secure a balanced position for the NHS overall.”

Every CCG had 1 per cent of their allocation held back at the start of the year, with any release of this funding requiring Treasury approval.

Last summer, NHS England chief executive Simon Stevens said this money was stripped out of budgets that “would have been available from CCGs for mental health services, community health services, primary care and other things”.

NHS leaders get ‘lippy’

NHS Providers has urged councils and NHS leaders to agree targets for short term reductions in hospital bed days, after the announcement of £1.2bn extra in social care funding for 2017-18 in the budget.

The body representing NHS trusts welcomed the extra money announced but warned its members to start negotiating with local government partners now on how it would be spent.

The comments come after a very senior NHS source warned that NHS organisations would have to be “lippy” in order to get value out of the money going to councils. Ensuring the funding leads to reductions in hospital bed use is central to NHS national leaders plans for improving performance in the next financial year, in particular next winter.

New NHS estates body

We’re still waiting for Sir Robert Naylor’s review of NHS estates to emerge (some people expected it to appear during the budget) but we now know at least one of his recommendations will be adopted by the government.

The former University College London Hospitals chief executive was appointed last year to advise the government over the NHS estate, and said in June that there needed to be better strategic oversight of NHS property.

It’s now been confirmed that the government is planning to establish a new national body to provide “strategic estate planning” for the health service.

Health minister Lord O’Shaugnessy confirmed the government had accepted Sir Robert’s recommendation, but further details on the new organisation, including its form and “models for its future ownership”, will be set out at a future date.

CCGs ready to merge

It’s starting to feel like the floodgates are ready to swing open on clinical commissioning group mergers, after several years in which they were actively discouraged by national leaders.

Liverpool, South Sefton and Southport and Formby CCGs are among the latest to announce plans to create a single organisation, which would be the biggest CCG in the country.

Meanwhile, Leeds South and East, Leeds West and Leeds North CCGs will have one leader from next month, and a new joint strategic commissioning board from May.

These developments follow recent confirmation of the merger of three CCGs in Manchester.

Commissioning across whole STPs

A region has taken a massive step towards STP-wide decision making after all its cCCGs signed up to create a joint committee.

All 11 CCGs in the West Yorkshire and Harrogate STP area have signed the memorandum of understanding and terms of reference to set up a joint commissioning committee for the region.

The new committee will be made up of two members from each CCG, an independent chair and two lay members and will make decisions about how STP-wide services are commissioned.

Key areas it will take decisions on include cancer, mental health, urgent and emergency care, and standardising commissioning policies across the footprint.

Right Care rules

NHS England has come to the defence of its Right Care programme, following reports about commissioners using it to ration knee and hip surgery.

Using a subtle letter explaining how to use Right Care data for musculoskeletal pathways, the national commissioner told CCGs that hip and knee operations are quite cost effective and that investment should not be interpreted as “poor or good value without further investigation”.

However, NHS England’s attempt to gently nudge CCGs about rationing has been slightly ruined following a strongly worded email from regional officials.

When emailing the national team’s letter to CCGs, an area team warned they were aware that some CCGs are “rationing” joint replacement surgery using “arbitrary cutoffs” such as the Oxford pain scoring system and “restricting” surgery for smokers and obese people.

The email told commissioners to send a report on whether they had implemented these type of measures and warned if they intend to do so in the future they would need to get it agreed with their regional teams.