Some of the most financially challenged health economies were among the biggest contributors to an £800m pot established to settle continuing healthcare claims that was clawed back by the Treasury, an HSJ investigation has found.

Worst hit by clawback

Primary care trusts set aside around £650m in the year before they were abolished with the aim of ensuring there was sufficient funding available for clinical commissioning groups to settle thousands of retrospective claims for continuing healthcare funding, dating back to 2004.

This brought total continuing healthcare provisions on commissioners’ books to nearly £800m. It was hoped these provisions would save CCGs from coming into being with “legacy debts”.

However, as HSJ reported in March, these provisions helped the Department of Health record a large surplus in 2012-13, which was referred to the Treasury.

The £800m is unavailable to be drawn down and £250m is expected to be topsliced from CCGs’ 2014-15 budgets to create a national pot to cover retrospective claims settled this year.

HSJ analysis has now found that some of the areas that made the biggest provisions in 2012-13 were among the most financially challenged health economies in the country.

Among the five PCTs that made the largest provisions as a proportion of their 2012-13 allocations (see table, above), two – Harrow and Hillingdon – had longstanding financial problems that persisted with the advent of CCGs.

Hillingdon’s successor CCG recorded a deficit of £5m in the last financial year, while Harrow CCG expected a deficit of £10m.

Both were among the 9 per cent of PCTs that made provisions in excess of £10m for continuing healthcare claims in 2012-13, as was Oxfordshire, whose successor CCG was on course for a £6m 2013-14 deficit.

NHS England argues that CCG allocations for 2014-15 included funding to cover retrospective continuing care claims.

However, CCG representative body NHS Clinical Commissioners counters that the NHS has in effect paid twice for the historical liability and that without the £250m topsliced this year many CCGs’ allocations amount to real terms cuts.

Steve Kell is co-chair of NHSCC’s leadership group and chair of Bassetlaw CCG, whose predecessor PCT also made proportionally one of the largest provisions in 2012-13.

He said that the NHSCC was working with NHS England to find solutions to commissioning group concerns about the financial and administrative burdens of retrospective care claims.

“It’s concerning that [CCGs] need to do so much to improve services and efficiency [and] that every CCG is having to spend a lot of resource – both financial and managerial – on retrospective commissioning,” said Dr Kell.

He added: “The retrospective issue is a real burden for CCGs.”

An NHS England spokeswoman said the organisation was currently in discussion with CCGs on “assurance around payments for continuing healthcare claims”. Asked what potential changes to the current regime for processing and paying claims were being discussed, and whether CCGs would be topsliced again in 2015-16, she said discussions were “on-going”.

Additional reporting by Anthony Jones.