• Leaders expected to develop and agree five year plans during the first half of 2019-20
  • A tighter planning process had previously been considered
  • Commissioner allocations to be published in December 2018

Health economies have been told to create five-year plans by autumn 2019, to set out how they will improve services and achieve financial sustainability.

In a letter to local leaders today, NHS England and NHS Improvement said “sustainability and transformation partnerships” and “integrated care systems” will be expected to develop and agree their plans during the first half of 2019-20.

The letter, from chief executives Simon Stevens and Ian Dalton, said: “This will give you and your teams sufficient time to consider the outputs of the NHS long term plan in late autumn and the spending review 2019 capital settlement (in the spring); and to engage with patients, the public and local stakeholders before finalising your strategic plans.

“Nonetheless, it is a challenging task. We are asking you to tell us, within a set of parameters that we will outline with your help, how you will run your local NHS system using the resources available to you.

“It will be extremely important that you develop your plans with the proper engagement of all parts of your local systems and that they provide robust and credible solutions for the challenges you will face in caring for your local populations over the next five years.”

The letter also says organisations and systems will first have to develop one-year operational plans for 2019-20 - a “transitional year” - and asks them to begin work this autumn on activity, capacity and efficiency planning.

The new five-year plans would replace those which were previousuly drawn up by STPs, which were based on the previous five year funding settlement to 2020-21. This process was heavily criticised for the unrealistic efficiency assumptions required, and a process seen as secretive.

The national NHS long term plan is currently being developed in response to the government’s commitment to increase the NHS England budget by £20.5bn in real terms by 2023-24.

The letter, which NHS England shared with HSJ, said five-year commissioner allocations will be published in December. Planning guidance will also be published in December.

It also confirmed a move away from the current system of control totals in the “medium term”, not in 2019-10, and said the CQUIN incentive payment scheme for providers would be “significantly reduced”.

It said: “We believe that individual control totals are no longer the best way to manage provider finances. Our medium-term aim is to return to a position where breaking even is the norm for all organisations.

“This will negate the need for individual control totals and, in turn, will allow us to phase out the provider and commissioner sustainability funds; instead, these funds will be rolled into baseline resources. We intend to begin this process in 2019-20.

“Therefore, 2019-20 will form a transitional year, in which we will set one year, rebased, control totals.” Earlier this month Mr Dalton announced that a substantial amount of the provider sustainability fund would in 2019-20 be transferred into tariff for urgent and emergency care.

STPs to create new five year plans