ICB told to pay £10m to councils after funding dispute

North Central London ICB said it had been “unable to reach agreement” with the councils over the “national discharge fund”, part of the Better Care Fund, which is meant to provide joined up out-of-hospital care, to help with hospital discharge.

The ruling was reached because the cost of discharges has increased “considerably” due to inflation and other cost pressures in recent years, the ICB told HSJ.

The ICB and Barnet, Camden, Enfield, Haringey, and Islington councils entered a mediation process with an independent arbiter, and an agreement has now been reached.

Under the settlement, the ICB will give a total of £10.4m to the councils this year, of which more than £7m will be recurrent.

More than £4.5m will be for discharge work overseen by the five councils.

Around £3m will cover the consequences of a “Section 22 Policy”, setting new spending boundaries, which the councils introduced in April. Another £3.4m relates to funding for 2023-24, which the ICB said was meant to be conditional on a piece of work which was never concluded. 

An ICB board paper said: “The process has also put an element of strain on relationships and there is a collective determination to move on from this challenging episode.”

The ICB said there is also “appetite [in the system] to look at the BCF in its totality”, since it will have to pay most of the funding recurrently.

The ICB has been planning a wider review of the “efficiency and efficacy” of BCF investments, it said.

“Now that these issues have been resolved this wider review can take place and potentially help to address some of the funding challenges,” the ICB said.

The national discharge fund was introduced under the previous government, aiming to improve the safety and timeliness of hospital discharges to the home or community. The 2022 autumn statement announced put £600m into the fund for 2023-24, and £1bn in 2024-25, mostly distributed via the NHS.

The ICB declined to say who carried out the arbitration, but NHS England and the Local Government Association can be involved in BCF arbitration.