A clinical commissioning group must pay an unexpected bill likely to run to millions of pounds, after a legal judgement that it had been wrongly undercutting tariff rates to an independent provider for three years.
Corby CCG said it expected to make “cuts [to] other services” to pay for the “serious financial implications” of the successful challenge by a local urgent care provider, called Lakeside Plus Ltd.
The CCG has been in dispute with the independent GP led provider about payments and about its provision of an urgent care centre in the town.
Last week the provider won an expert determination – an alternative legal process that avoids formal litigation – against the CCG.
The presiding QC ruled that the CCG had wrongly failed to pay the national NHS tariff rate for services provided. The ruling ordered the CCG to increase the rate it was paying for activity by at least 25 per cent, and backdate payments to 1 April 2014.
The CCG has declined to say what it expects the total bill to be. However, a CCG spokesman told HSJ: “The CCG is still assessing the full impact of the expert determination on the dispute with Lakeside Plus about the tariff paid for urgent care centre services.
“However, it is clear that the outcome will have serious financial implications for the CCG, which are likely to require substantial savings to be found through cuts in other services.”
Calculations by HSJ suggest the bill is likely to be at least £1.7m, but could potentially range into several million. As the smallest CCG, Corby’s 2017-18 allocation is only £107m in total.
The CCG’s 2016-17 annual accounts said “no provision has been made” for any claim arising from the dispute as “the commissioners believe the claim is not well founded”. However, the CCG has not stated that it will need to retrospectively adjust those accounts.
The CCG spokesman said: “The expert determination is not fully concluded but [the QC] has decided the price payable for the service at Corby urgent care centre is by reference to the national tariff for a type 3 A&E Department.” He said the CCG was “disappointed that the expert considered the [tariff] variation [agreed in May 2014 with Lakeside Plus] was ineffective”.
Lorna Garner, general manager of the centre, told HSJ the ruling found that the CCG “had not followed” national rules for tariff price variation. It is allowed but only if publicly consulted on. Corby CCG and Lakeside Plus had agreed a price per patient in private.
Ms Garner said the ruling proved that “where national tariff applies, tariff has to be paid, and to not do so is unlawful. That is what we have tested”. She added as a result of the finding there could “further challenges” from other providers seeking to secure a backdated national tariff price for their services.
Following the judgement, local MP Tom Pursglove wrote a highly critical open letter to the CCG’s accountable officer Carole Dehghani. He asked whether commissioners had “considered [their] respective positions in light of [the ruling]” and said the CCG should “immediately seek permission to be taken over by Nene CCG”.
Plan to close the centre
There is also dispute between Lakeside Plus and the CCG over the latter’s plan to close the urgent care centre, and replace it with a same day GP access centre. This issue has not been resolved and Mr Pursglove accuses the CCG of having wrongly made the decision without consultation.
The CCG is understood to be in negotiation with Lakeside Plus to temporarily extend its current agreement, so that services can be provided beyond September.
A CCG spokesman said: “If the CCG is unable to find a provider capable of delivering the service at an acceptable cost, there will be no contract in place on 1 October 2017 and the UCC will close on that day – at least on a temporary basis.”
Lakeside Plus is a different organisation to Lakeside Healthcare Group – the very large GP partnership also based in Corby and involved in the NHS England vanguard programme.
Information provided to HSJ
14 August 2017