Health chiefs to be quizzed on Hinchingbrooke franchise as PAC to update inquiry, plus the rest of today’s news and comment.

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4.45pm NHS Confederation chief executive Rob Webster wrote a comment piece for HSJ last November in which he said the 2015-16 tariff proposals could make it harder for commissioners and providers to work together, at a time when they need each other the most.

Here it is in full.

4.10pm The first cohort of Finance Educators has been trained to engage doctors and nurses to understand the value of their decisions. The 22 delegates, recruited from finance staff across the NHS, attended the pioneering programme in Birmingham on 29 January.

Delegates heard from experts in “training the trainer” techniques, leading clinicians, experienced finance trainers and high profile figures such as the Director of NHS Right Care Professor Matthew Cripps, and over 100 applicants will go through the programme over the next few weeks.

The programme has been developed by clinicians, finance staff and patients and draws on training resources provided by the leading professional bodies such as the Healthcare Financial Management Assocation, as well as best practice case studies within the NHS.

Planning for the programme was already underway before the publication of NHS England’s Five Year Forward View, which outlined the stark realities of NHS funding against constantly rising demand, and how all parts of the NHS need to respond.

4.07pm Responding to the National Tariff 2015-16 delay Rob Webster, chief executive of the NHS Confederation, said: “A lot of time and effort has gone into engaging with Monitor and NHS England on the 2015/16 National Tariff and the situation we have ended up in suits no-one.

“While it is right that a fair solution be reached, the timelines set by Monitor and NHS England means this delay has an unacceptable impact on planning for 2015/16. Furthermore, they must be disappointed that we could reach a point where an external body needs to come in to arbitrate.

“The most important conversations in the NHS are the ones that happen locally and these are now hampered because not enough has been done nationally to agree prices. Time spent on planning nationally has come at the expense of time needed to plan locally and this puts another barrier in front of those local systems trying to work together to coproduce change in tough times. Once we reach an acceptable resolution to this interruption, we need to consider the valuable lessons from how the whole NHS has been engaged on the last two processes for setting tariffs and develop a process that will work on the third time of trying.”

On the proposals in the 2015/16 National Tariff: “We remain concerned about some proposals in the tariff, most notably the decision to implement an untested marginal rate for acute-prescribed specialist services. Without the evidence to the contrary, our members can only infer that this seems a risk transfer from NHS England’s budget to local systems.

“It will have a big impact on a number of health systems and the extent of concern raised over the last few months demonstrates this.”

3.59pm Responding to the news that Monitor are delaying the implementation of the 2015-16 national tariff Paul Briddock, HFMA policy and technical director, said: “NHS providers have been hit by the cumulative impact of high levels of sustained efficiency requirements and increasing demand – particularly in non-elective activity.

“Much of this activity has been paid for at marginal rates and the proposed new marginal rate for additional specialised services activity would have added to these challenges.

“The service remains committed to quality and safety improvements but providers - particularly acute providers – are already facing significant financial challenges and are clearly concerned about the sustainability of services under the proposed revised tariff arrangements.

He added: “The tariff is a vital component in developing local plans for services in the run up to the new financial year. We need to resolve this situation as quickly as possible in a way that provides the right amount of challenge to providers to improve financial and service performance, covers providers’ legitimate costs in delivering patient services and shares risk sensibly across economies.”

3.21pm Following the announcement that Monitor is delaying the implementation of the 2015/16 National Tariff in light of significant objections to its proposals from providers, Independent Mental Health Services Alliance chair Joy Chamberlain said: “IMHSA members were very disappointed that the original proposals did little to address the significant disinvestment in mental health seen in recent years.

 “The review process gives Monitor the opportunity to rectify this and ensure that mental health receives the funding it needs.

“In particular, IMHSA was concerned that while the proposals made clear that prices for mental health services should be set at a local level, it contradicted this advice by stating that local prices should have regard to the national tariff.

“This is not in keeping with the spirit of local pricing and does not pay due regard to the different cost base of mental health providers and the significant efficiencies delivered by the independent sector in mental health.

“It is essential that Monitor does not disadvantage mental health when revising the tariff proposals and takes these concerns and differences into account. The final tariff must provide the funding environment needed to ensure that patients are able to access high quality, local mental health care in a timely manner.

“A parity of tariff deflator does not equal a parity of esteem and more needs to be done to tackle the wider problem of disinvestment in mental health.”

2.58pm Commenting on the news that next year’s proposed national tariff for NHS services has been rejected, Richard Murray, Director of Policy at The King’s Fund, said: “The rejection of the proposed national tariff for next year is very significant.

“It signals that the policy of implementing year-on-year reductions in the prices paid to hospitals for their services has reached the end of the line.

“This is an unprecedented development. It is not clear what the outcome will be but, with just three months to go before the start of the financial year, it will throw financial planning in the NHS into disarray.

“With signs that it is becoming increasingly difficult to maintain downward pressure on staff pay, it indicates that the two main ways used to reduce NHS costs over the last few years - limiting staff salary increases and reducing payments to hospitals – have now been largely exhausted.

“With financial problems among hospitals now endemic, waiting times rising and staff morale a significant cause for concern, this once again indicates that the situation facing the NHS is becoming critical.’

2.49pm Fines levied on hospitals for missing the accident and emergency waiting target could increase by more than 35 per cent under new rules proposed for the coming financial year, HSJ analysis has found.

NHS England’s draft standard contract for 2015-16 proposes to change the cap on financial penalties for failure to treat, admit or discharge 95 per cent of A&E patients within four hours.

Currently, providers are fined £200 for every patient who takes the trust below 95 per cent, but this is capped once performance falls to 92 per cent.

13.58pm Responding to the announcement from Monitor that they are delaying the implementation of the 2015-16 national tariff Dr Steve Kell, co-chair of NHS Clinical Commissioners said: “This is a really disappointing situation for CCGs and patients at a time when the NHS needs effective planning and service improvement. 

“This is a crucial year for the NHS and it is essential NHS England and Monitor reach an agreement soon which addresses the concerns of providers and commissioners. 

“We need a national tariff system that enables and supports local relationships not undermines them.  This delay is likely to lead to significant cost implications for commissioners and it is vital that CCGs do not have additional financial pressures in a year when we need to deliver real change for patients and ensure the Better Care Fund is effective.”

13.44pm NHS England has shelved plans to transfer responsibility for specialist renal and morbid obesity services to clinical commissioning groups this year after warnings it would put patients at risk.

The national commissioning body made the announcement this week as it launched a consultation on its approach to prioritising which specialist treatments to invest in, including the principle that treatments should only be funded if they are a “reasonable cost to the public”.

NHS England had planned to hand commissioning of renal dialysis and bariatric surgery to CCGs in April.

13.39pm The King’s Fund chief executive Chris Ham tweets:

13.34pm Five years of cuts and undeliverable targets, and unprecedented demand left providers with no option but to reject NHS England’s 2015-16 proposals, says Chris Hopson, NHS Providers chief executive.

1.05pm In a statement released shortly after midday, NHS England chief financial officer Paul Baumann warned that “since the overall NHS funding totals for 2015-16 are now agreed, any changes to the proposed tariff would in practice just be robbing Peter to pay Paul - meaning less investment in other hospitals, mental health or GP and community services - the exact opposite of what pressures this winter show is now needed.”

12.42pm Judith:

12.38pm Judith Welikala tweets:

12.20pm Phillippa Hentsch, from NHS Providers tweets:

12.17pm Chris Hopson, chief executive, NHS Providers, responding to the announcement of today’s veto of the 2015-16 tariff by NHS providers, said:

Clear response

“The fact that 75 per cent of NHS providers, measured by activity, have vetoed the NHS 2015/16 tariff is hugely significant. It is a clear response from the NHS frontline that they can no longer guarantee sustainable and safe care and meet constitutional performance targets from 1 April 2015 unless immediate changes are made to the way they are paid for their services.

Continued cuts

“The proposed tariff is a fifth year of 4 per cent cuts to what NHS providers are paid combined with unachievable efficiency savings, despite demand rising by 4 per cent a year.

A fifth year of hospitals receiving only 50 per cent of the cist of recent demand increases in A&E; and ambulance, mental health and community trusts not being paid properly for the emergency patients they treat.

And now NHS providers of the most complex care for rare conditions would only be paid half the price of additional activity in 2015/16. Together this takes £1.7 billion away from NHS providers in 2015/16 despite an expected 4 per cent increase in demand.

Situation critical

“80 per cent of England’s hospitals are now in deficit and most are running their accident and emergency (A&E) departments at a substantial loss. Financial deficits are now spreading to mental health, ambulance and community trusts.

And, as the much respected Kings Fund think tank said last week: “Services are stretched to the limit. With financial problems endemic among hospitals and staff morale a significant cause for concern, the situation is now critical.

Last resort

“This isn’t a decision that provider leaders have taken lightly. Triggering the objection mechanism has repercussions for them, creating uncertainty over the contracting round and service plans for 2015-16 which starts in just two months.

But after five years of unprecedented price cuts, with NHS providers realising more than £20bn of savings over this parliament, objecting to the tariff for many represents a last resort to have their concerns heard as they can no longer guarantee safe and effective care unless they are properly and fully paid for the patients they treat.

We have now reached the point where patient care is at risk. Either we fit the money to the care provided – NHS providers being paid fully for the patients they treat; or we fit the care to meet the money available – ensuring that providers are commissioned for realistic levels of care to reflect the static overall NHS budget. What we can’t carry on doing is pretending that NHS trusts can achieve the impossible and then berate and criticise them when they inevitably fall short.

Five immediate changes

“We need five immediate changes:

·         NHS system leaders need to ensure that NHS providers are fully and properly paid for the care they provide. NHS providers should be asked for a deliverable level of efficiency savings in 2015/16, not an impossible 3.8 per cent which for many providers equates to around 6-10 per cent savings next year due to the other tariff measures;

·         All emergency work should be paid for at 100 per cent of tariff cost, not the current 30 per cent or proposed 50 per cent; and the proposal that providers of specialised care should be only paid at 50 per cent of cost for any increases in demand should be scrapped, with providers and commissioners agreeing the best way to control the specialised commissioning budget;

·         A strong focus on managing the risks to mental health, ambulance and community trusts who have to operate on block contracts, as they are particularly vulnerable to large demand increases;  we also need guarantees that full funding will be made available, before 1 April 2015, to ensure delivery of the new NHS mental health targets being introduced in 2015-16;

·         Financial risk should be equally shared between commissioners and providers so that organisations can work together to address the underlying demand growth and efficiency challenges while ensuring all available resources reach the frontline.

·         A shift away from penalising providers for failing to deliver an unrealistic financial or performance target and a move toward supporting NHS providers to tackle the operational pressures they face.

Transparent and sustainable solution

“It’s essential that NHS England and Monitor work with the sector to find a solution which is transparent and sustainable for 2015-16. We need to learn from this experience to reset the way in which decisions about the national tariff for 2016/17 are made and the way NHS England and Monitor engage with providers on these crucial issues. 

“A month ago Circle, a private health company, announced it was handing back Hinchingbrooke Hospital to the NHS because it was impossible to run sustainably.

NHS providers don’t have that luxury. This is a similar statement that it is now impossible for all but the very strongest NHS providers to cope with rising demand, meet performance targets and achieve financial balance. We need NHS system leaders to hear this veto and we need immediate changes”.

12.10pm BREAKING EXCLUSIVE: The NHS will go into what is expected to be its toughest financial year yet with no nationally agreed set of prices for services, after controversial 2015-16 tariff proposals were resoundingly rejected by the dominant providers.

Speaking exclusively to HSJ this morning, Monitor chief executive David Bennett revealed that providers responsible for a 75.1 per cent share of all NHS services had lodged formal objections to the proposed tariff.

That means objections have clearly breached the 51 per cent threshold at which the pricing authorities must either refer their proposals to the Competition and Markets Authority for review, or consult the health service again on revised prices taking into account the objections.

12.06pm Judith Welikala tweets a comment from NHS England’s finance director Paul Baumann:

12.00pm The Department of Health and Public Health England have announced that responsibility for public health nursing and midwifery leadership will transfer to PHE from April, replacing the current joint arrangement between the department and the agency.

The new arrangements will make sure strong strategic direction is in place for the future.

Viv Bennett will continue her current leadership role as director of nursing and midwifery and also as the government’s principal advisor on public health nursing, in the same way that the chief nursing officer is the government’s principal advisor on NHS nursing based in NHS England.

The Department of Health will also establish a nursing and midwifery policy unit to make sure clear strategic messages are being delivered. This unit will be led by Dr David Foster.

Viv Bennett, director of nursing and midwifery, said: “It is vital that public health nurses and midwives have a strong professional voice and leadership so we can continue to drive improvements in protecting the public’s health.

“It has been a privilege to serve in this joint role and I am proud of all that has been achieved in the last 2 years.

“I’m delighted to have the opportunity to both focus on public health nursing and continue working with professional colleagues in DH and across the health and care system.”

As part of the role, Ms Bennett will continue to lead on the ‘Giving every child the best start in life’ priority for PHE.

She will also work jointly with Professor Paul Cosford, the Medical Director for PHE, to provide leadership in PHE quality improvement and assurance programmes.

The nursing and midwifery policy unit will be established in the directorate of strategy and external relations in the Department of Health. David Foster will continue to have the responsibility for nurse leadership in the social care sector.

11.00am Judith tweets:

11.00am HSJ reporter Judith Welikala is at NHS England’s board meeting this morning. Follow her on Twitter for the latest.

10.58am The Care Quality Commission has formally warned Vista Independent Hospital at Winchfield in Hampshire that it must make urgent improvements to protect its patients from abuse.

The warning follows an unannounced visit by inspectors to the hospital in November to follow up safeguarding concerns.   Since then the provider has agreed not to admit any further patients while a specialist team has been brought in to oversee improvements.

The hospital is registered for up to 69 patients with mental health needs or learning disabilities, including people who are detained under the Mental Health Act.

10.51am The Department of Health has recommended a set of food standards that should become routine practice across NHS Hospitals.

Full report here.

10.49am The Guardian covers yesterday’s row between the government and Labour about the rules governing the declaration of “major incidents”.

David Cameron told Ed Miliband in the Commons that a document appearing to tighten the criteria under which hospitals can declare the status had been issued by the West Midlands local area team without reference to ministers.

However, Labour claimed that a separate document issued centrally by NHS England last year had called on trusts to consider the “reputational damage” of declaring a major incident.

Also in The Guardian, the paper reports that up to three thousand foreign trained doctors have been hired by the NHS in the past year.

They come from at least 27 countries, including India, Poland, Australia, Greece, Iraq, Syria and Sudan.

10.48am Former Labour leader Neil Kinnock has called for an end to the ‘internal sniping’ at Ed Miliband, after senior figures attacked Mr Miliband’s election message of protecting the NHS, The Times reports.

The intervention follows comments made by party grandees such as former health secretary Alan Milburn that failing to champion reform was a mistake.

The Times also reports on the findings of an authoritative survey that show public satisfaction with the NHS has jumped to 65 per cent.

With the NHS bound to be an election battleground, voters have said they were broadly pleased with its performance.

Elsewhere, the paper writes that ambulance response times in Wales have reached record lows, according to figures which reopened a bitter political row over who is to blame for the problems facing the NHS.

Less than 43 per cent of Welsh high-priority calls got an ambulance within eight minutes in December, down from 51 per cent in November and well below the target of 65 per cent.

In England, which has a target of 75 per cent, about 70 per cent of calls are reached within eight minutes.

10.36am Looking to this morning’s newspapers,The Independent reports on its front page on the ‘scandal’ of doctors who ‘take cash for referrals’.

The paper writes that the financial interests of all UK doctors should be made public, the country’s leading medical journal has said.

The intervention comes after an investigation revealed incentives, often worth tens of thousands of pounds, have been offered to doctors by private healthcare companies in exchange for referring patients to their hospitals.

An investigation in the British Medical Journal claims that the doctors’ regulator, the General Medical Council, failed to act on a warning in 2012 that the practice of offering incentives was “widespread, particularly in London, and significant in value”

The paper also writes that public satisfaction with the NHS is at its second highest level ever, according to a new survey, in surprise findings that suggest soaring waiting times and severe pressures on A&E have not shaken people’s faith in the health service.

The British Social Attitudes survey, carried out by the highly-respected King’s Fund think-tank, found that satisfaction rose to 65 per cent in 2014, while dissatisfaction was down to just 15 per cent – its lowest level since the survey began in 1983.

Separately, the paper reports that a woman with a rare kidney condition has told how she was “given her life back” by a new ‘£10 million per patient’ drug that was today made available on the NHS.

When Emma Woodward was 26, a hospital consultant wrote the numbers five and 10 on a piece of paper and told her: “You can expect to live another five to 10 years –  if you get the best kind of dialysis.”

Miss Woodward had atypical Haemolytic Uraemic Syndrome (aHUS), which affects only about 200 people in England, with 20 to 30 patients diagnosed every year.

10.20am BREAKING: The public accounts committee is updating its inquiry into the franchising of Hinchingbrooke Health Care Trust and has summoned key figures to give evidence at an an oral evidence session next week.

The committee of MPs, led by Margaret Hodge, will take evidence from senior figures from private health firm Circle, regulators and commissioners on 2 February at 3:15

The committee will hear from:

  • Richard Douglas, Director General for Finance and the NHS, Department of Health,
  • David Flory, Chief Executive of the NHS TDA,
  • Steve Melton, Chief Executive Officer, Circle Holdings,
  • Hisham Abdel-Rahman, Chief Executive, Hinchingbrooke Hospital,
  • David Behan, Chief Executive, Care Quality Commission
  • Maureen Donnelly, Chair, Cambridgeshire and Peterborough CCG

Circle took operational control of Hinchingbrooke Health Care Trust in February 2012, becoming the first private company to run an NHS hospital.

On 9 January 2015, three years into the 10-year operating franchise, Circle announced that it had entered into discussions with the NHS Trust Development Authority with a view to withdrawing from the contract.

10.05am Findings from the survey, conducted by NatCen Social Research, on specific services were:

While GP services remain the most popular NHS service in terms of satisfaction, the satisfaction rating of 71 per cent in 2014 was the lowest since the survey began

  • satisfaction with outpatient services is at an all-time high of 69 per cent
  • accident and emergency (A&E) services experienced an increase in satisfaction to 58 per cent (from 53 per cent last year) despite much-publicised difficulties in meeting waiting time targets in 2014
  • satisfaction with dentists remained lower than with other NHS services, with 54 per cent of respondents satisfied with the service
  • satisfaction with social care services is far lower than with the NHS, with just 31 per cent of respondents satisfied with social care and 30 per cent being dissatisfied.

John Appleby, chief economist at The King’s Fund, said: “With the NHS a leading issue ahead of the general election, the British Social Attitudes survey provides a useful snapshot of how the public views the NHS. Public satisfaction with the NHS is high and has risen significantly, despite a year in which the service hit the headlines for financial pressures and difficulties with A&E waiting times.

But as well as an actual increase in satisfaction, this may in part reflect a desire among the public to show support for the NHS as an institution.’

10.03am Public satisfaction with the way the National Health Service runs has risen to its second highest level ever, according to British Social Attitudes survey data for 2014 published by The King’s Fund.

With less than 100 days until voters go to the polls in a general election where the NHS seems certain to be a central issue, the survey data provides an important barometer of how the public views the NHS. The latest results show public satisfaction with the NHS rising from 60 to 65 per cent in 2014, while dissatisfaction fell to an all-time low of 15 per cent.

Analysis of the data shows an 11 percentage point increase in satisfaction among Labour supporters (to 69 per cent). Satisfaction among Lib Dem supporters increased by five percentage points (to 68 per cent) and remained about the same among Conservatives (at 67 per cent), leaving a close convergence between the supporters of the three main parties. Satisfaction among supporters of UKIP was lower, at 57 per cent.

Previous surveys have tended to show higher satisfaction levels among supporters of the governing party or parties. With the NHS having been under financial pressure and experiencing difficulties in meeting A&E waiting times targets, both of which have been widely reported in the media, this rise in satisfaction among Labour supporters could suggest a vote of support for the NHS as an institution, at a time when some see it as under threat.

While satisfaction among respondents with recent personal experience of the NHS increased by 4 percentage points from 2013 to 2014, it jumped 11 percentage points among those who had no recent contact with the NHS, either personally or through friends or family members.

7.00am Good morning and welcome to HSJ Live.

As part of HSJ’s analysis of the upcoming general election, Nicola Sturgeon’s insistence that Scottish MPs will vote on English NHS decisions is motivated by fears the Scotland’s health service’s budget will be cut, argues James Tout, a former Scottish government communications officer who now works for the healthcare PR agency Journalista.