STRUCTURE: Leaders in Greater Manchester have revealed some of the ‘radical changes’ to the way NHS services could be funded in the region from next year.

  • Health and council leaders in Greater Manchester call for £500m of “pump prime” funding
  • Devo Manc project hopes to phase out payment by result for capitated budgets
  • Proposals submitted to comprehensive spending review

Health and council chiefs have this week submitted draft proposals to the government’s comprehensive spending review, as part of the Greater Manchester devolution programme.

Speakers at the Health and Care Innovation Expo, held in Manchester, today revealed plans to:

  • receive “pump prime” funding to invest in new models of care and other initiatives;
  • secure a multi-year funding settlement for the region;
  • phase out the payment by results tariff and move to capitated budgets; and
  • introduce a system approach to “distress funding”, rather than it being focusedon individual organisations.

A spokesman for the devo Manc project confirmed to HSJ that leaders have requested £500m of initial funding.

Dr Ranjit Gill, chief clinical officer at Stockport Clinical Commissioning Group, said of the proposals for pump prime funding: “The deal will be that the money we receive is invested in new models of care, but at the end of the five years we’ll be in a position to pay it back.”

He said workforce shortages would also need addressing, so the money could be used to recruit more doctors, for example.

Meanwhile, the use of capitated budgets will be tested by the “vanguard” projects in Salford and Stockport, with the hope of phasing out the payment by results tariff across the region if this is successful.

Dr Gill said a new population based payment system would avoid the “perverse incentives” built into the current activity based tariff.

The region will also examine whether bailout funding could be better spent on a health system basis, rather than being allocated to a specific trust in financial difficulty.

Dr Gill said: “In times gone by a hospital would have asked for distress funding and Monitor will have made a decision about that.

“There wasn’t a wider system look at that sort of investment. We are able now to stand back and look at those sort of decisions and decide whether there might be a better use of the resources.”

Donna Hall, chief executive of Wigan Council, told the same event that the draft proposals have requested a “multi-year settlement” from the spending review. She said there would be a drive to divert cash from specialist care to prevention services, while quality metrics were being developed around cancer care, life expectancy and early years provision.

Work has also started to create common recruitment processes between NHS human resources departments, while another presentation referred to a move towards collective decision making in the provider sector, which could effectively prevent a trust from vetoing necessary changes to hospital services.

The spending review will be published on 25 November.

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