The Department of Health has scrapped plans to withhold money from areas that fail to deliver performance improvements through joint commissioning with local authorities.

Instead the DH, together with NHS England and the Local Government Association, will offer “support” where the £3.8bn better care fund does not lead to improved performance on metrics including delayed transfers and reduced emergency department admissions.

The policy shift was revealed by ministers in a joint interview featuring HSJ and its sister magazine Local Government Chronicle.

Norman Lamb

Picture credit: Peter Searle

Norman Lamb: “It would be inappropriate to withdraw funds for areas that fail to hit targets”

The better care fund takes effect in 2015-16, building on £1.1bn that is already being transferred from health to social care. The fund will be jointly controlled by councils and clinical commissioning groups through health and wellbeing boards. Of the additional £2.7bn, £2.4bn will come from a 3.5 per cent topslice of clinical commissioning group budgets.

When the expanded fund was announced last summer, the care and support minister Norman Lamb said an element of it would be tied to performance. The proposal was fleshed out in December when NHS England published its planning guidance for the fund.

But the DH has since scrapped the idea. Mr Lamb told HSJ and LGC: “We’ve decided it would be inappropriate to withdraw funds for areas that fail to hit targets.

“This is a big reassurance for councils and CCGs. [But] it’s really important people do hit the objectives, and if they don’t there will have to be support going in to help improve their performance.”

The change in policy only currently applies to 2015-16. Ministers have not yet decided whether to hold cash back based on performance from 2016-17 and beyond. Mr Lamb said this would be for “future governments” to decide.

HSJ understands the support will begin with help to devise a remedial plan where performance is not improving. If that fails, or if councils and CCGs cannot agree, the intervention could become increasingly intensive. However, Mr Lamb insisted that he did not want the support to be “the commissars coming in and imposing a different model… There will be potential for help from local government side through peer support but also through NHS England, through the local area teams.”

Local government minister Brandon Lewis added: “What we don’t want to do is create a system that has unintended consequences. That’s the purpose behind this – if we were to penalise somebody in the very early stages, actually all you’re doing is penalising the [service] users because you’re taking the money away from an area that needs that money spent on adult social care.”

NHS England guidance had said £1bn – more than a quarter of the £3.8bn total – would be paid depending on certain conditions being met. The cash would have gone out in two phases, with £500m in April 2015 and a further £500m payable the following October.

Now, the DH says all areas will receive their full share of the better care fund, although the phasing of the £1bn will remain.

As before, all areas will have to meet the following conditions:

  • protection for adult social care services;
  • provision of seven day services to support patients being discharged and to prevent unnecessary admissions at weekends;
  • “agreement on the consequential impact of changes in the acute sector”; and
  • the putting in place of an “accountable lead professional” for integrated packages of care.

They will also have to demonstrate good performance on five national metrics and one other measure to be identified locally by clinical commissioning groups and councils.

The national measures are:

  • delayed transfers of care;
  • avoidable emergency admissions;
  • admissions to residential and nursing care;
  • “effectiveness of reablement”; and
  • a patient experience measure, yet to be identified.

Steve Kell, co-chair of the NHS Clinical Commissioners leadership group, welcomed the move. “It makes absolute sense given we are exploring new relationships as well as new financial models,” he said. “The whole point is to get to a better system – to penalise when places are under financial pressure is not good management in the long run.”