Your essential update on health for the week

HSJ Catch Up

This weekly email gives HSJ subscribers a vital update on the biggest stories from the last week in health. If you have been out of the office or just too busy to keep up, HSJ Catch Up will ensure you are still in the know.

Cyber insecurity

Since the end of the National Programme for IT, the NHS has developed a reputation for not spending quite as much as it planned on technology.

On Tuesday, HSJ reported that the last major tech fund that was announced, in February 2016, was not flowing out to the system as expected.

In 2016-17, central NHS technology (which largely means IT systems) spending was £256m less than planned, equivalent to about a third of planned expenditure.

The signs point to another underspend this financial year and the Department of Health and Social Care has said tech money not spent as planned is fair game for diversion to alleviate “pressures” on other parts of the system – and there are plenty of those.

However, tech projects are not just competing against huge provider deficits and heaving A&E departments for money.

They are competing against a growing realisation that the NHS has not been spending nearly enough on cybersecurity.

In the wake of the WannaCry ransomware attack in May 2017, an NHS England review has recommended that the NHS needs £1bn to get up to speed on cybersecurity.

The review is not yet published and NHS England has played down the headline figure, claiming it was the product of an “early draft” and did not account for existing spending across hundreds of NHS organisations.

However, even if the eventual net figure is substantially lower, tech spending elsewhere will have to be cut, probably by hundreds of millions, to make room.

NHS England and the DH are still trying to lever more capital for cybersecurity out of the Treasury but HSJ understands that even in a best case scenario, belt tightening around existing tech projects will be necessary.

A tale of two mega-mergers

Trust mergers are as popular with the Treasury and Department of Health as ever, as our Following the Money expert briefing explores this week.

But they don’t come cheap.

In the last few days, two examples – mergers to create the two biggest providers in the NHS no less – highlight just how important the money is to get a merger over the line and make it a success.

In the North West, Manchester University Foundation Trust (the biggest trust in England, formed last year by combining Central Manchester University Hospitals FT and University Hospital of South Manchester FT) is likely to be given £125m in loans from the DH for a new electronic patient record, A&E reconfigurations, backlog maintenance and liquidity support.

Given how tricky it’s been for trusts to access capital from the centre in recent years, the money would be a huge vote of confidence for the merger and the trust’s management.

But down the motorway, the merger of Heart of England FT and University Hospitals Birmingham FT has been further delayed because the trusts are still waiting for assurances from NHS Improvement “regarding money, future liabilities and recompense for the cost of the transaction”.

The merger was approved by the Competition and Markets Authority last August and received enthusiastic support from NHSI, but HSJ understands the date for approving the merger has been pushed back several times since the summer.

Stockport could see strike

More problems have emerged for a high profile vanguard project in Greater Manchester, which is facing the threat of industrial action from staff affected by the new care model.

Up to now, the various vanguard schemes in England have gone about their work without too much controversy, with most people agreeing with the direction of travel.

But the Stockport Together project, which has benefitted from £23m of transformation funding, now faces the possibility of industrial action from Unison members, who are concerned about an expansion of unqualified support workers, as well as changes to hours and working practices that may not be mirrored by surrounding services.

The staff concerns present further difficulties for a project that has already been scaled back from the initial plans to form a single accountable care organisation.

The union is also concerned about some of the activity reductions and savings that have been projected by the vanguard partners with the help of PwC.

These include an overall 23 per cent drop in accident and emergency attendances, a 25 per cent reduction in outpatient activity, and a 20 per cent reduction in non-elective spells by 2020-21, compared to the 2016-17 baseline.

The reductions were expected to start kicking in this year but – you guessed it – the numbers have all increased.

While the dispute over working hours and practices is hopefully resolvable, delivering the activity reductions (and expected £40m savings) looks an exceptionally tall order.

A Cornish skirmish

When you’re one of the first areas to strike a devolution deal with the government, the last thing you want is squabbling between health and council chiefs over money.

But that is the situation in Cornwall – where the county’s mental health and community provider has warned it may have to consider entering a “formal dispute” with the county council over unpaid invoices.

The 35 invoices are worth more than £2m and it’s no wonder Cornwall Partnership FT is keen to get the money it’s owed given the tight financial constraints on every trust.

However, the council maintains it has a duty “to ensure the proper use of public funds and must be satisfied that invoices provide sufficient information to make payment”.

The invoices relate to historic arrangements within adult community services between the council and the previous provider, which were inherited by CPFT in April 2016.

Part of the problem appears to be both sides agreeing how much is owed by the council to the trust, but the local authority’s response to HSJ also implies its accountants are not impressed by the quality of the invoices.