NHS Operating Framework Response: Grip wins out over innovation

The independent health think tank Nuffield Trust today gave its immediate verdict in response to the publication of the NHS Operating Framework for the year 2012/13. 

Reflecting on the overall strategy, Dr Jennifer Dixon, Chief Executive, commented: 

‘This year’s Operating Framework lays bare the tensions that result from embarking on a wholesale organisational reform at a time of financial challenge in the NHS.  On the one hand, the centre intends to maintain a very tight grip on finances and quality, with strong lines of accountability flowing from the Department of Health to strategic health authorities and the PCT clusters during the transition to the new arrangements. Given the pressures on the NHS, this grip is important and understandable and the renewed emphasis on monitoring the quality of care and waiting times is particularly welcome.

It will be crucial for the NHS Commissioning Board to use its ‘shadow’ year to explore how it can create a permissive culture in the midst of financial discipline

Dr Jennifer Dixon, Chief Executive, Nuffield Trust

‘On the other hand, the reforms to the NHS were built on a vision of innovation, by new clinical commissioning groups, health and wellbeing boards, liberated Foundation Trusts and other new providers. The grip needed in 2012/13 must not snuff out this bottom-up innovation and yet it will be hard to maintain it, for example if all the new clinical commissioning groups are obliged to sign up to their PCT’s plans, as the Framework suggests.

‘It will be crucial for the NHS Commissioning Board (now NHS England) to use its ‘shadow’ year to explore how it can create a permissive culture in the midst of financial discipline. Monitor also has a powerful role to play as it expands its remit, to explore how new ideas about service integration can benefit patients while maintaining choice.’

Fellow Nuffield Trust experts commented further on other aspects of the Operating Framework. Dr Judith Smith, Director of Policy, said in response to the increased emphasis on dignity in care:

‘We very much welcome the renewed emphasis on quality, in particular the focus on meeting the needs of frail older people with complex and chronic conditions including dementia.

 ‘There is an increasing body of evidence that suggests that the NHS has consistently failed to assure humane and effective care for this group of people, ranging from the high profile system failures in Mid Staffordshire to the recent reports of individual failures of home care. The Government is right to be concerned. The financial pressures on the NHS raise the risk that these sorts of failures will multiply, and this is a major challenge for new clinical commissioners to grapple with.

‘The Framework sets out a series of actions for all NHS organisations to work towards, particularly in avoiding admission to hospital, where patients are particularly at risk. Not all admissions are avoidable and there needs to be much better ways of understanding the quality of care for frail older people once they are admitted. 

‘Above all, the voice of patients and carers need to be heard by providers and commissioners. The new structures being set up – HealthWatch and Health and Well Being Boards – will, in theory, increase local voice. However, the dangers of warning signals being missed in the transition are real: tragic lapses in care must not be the price of system reform.’

Reviewing the finance chapter, Chief Economist Anita Charlesworth said:

‘The Framework holds out the prospect of another very challenging year for providers and commissioners in the NHS, with providers facing a drop in prices of at least 1.5 per cent. This should not come as a surprise to anyone and the scale of the productivity challenge facing NHS providers is well known.  Commissioners also face another year of constraint, needing to hold back 2 per cent of their funding for ‘non-recurrent’ purposes. We would urge transparency about how that money is used in the coming year, not least to give confidence to the newly emerging clinical commissioning groups that there are clear audit trails and rules about how any surplus funds are actually used locally.

‘The NHS can only meet the productivity challenges that lie ahead by innovating and finding new ways to deliver services, including across organisational boundaries. Payment systems need to be reformed to allow this and the Operating Framework reiterates the Government’s commitment to expand the Payment by Results system to mental health services and other community based services. 

‘We still have concerns that the data underpinning the mental health tariffs are flawed by poor data collection and IT systems and could undermine confidence in the commissioning process. The NHS spends more on mental health than it does on cancer and heart disease. While there is clearly enthusiasm among commissioners to do this, we also know from recent NHS Confederation research that harvesting resource utilisation data has proven difficult. We would urge caution.

‘We note the requirement on commissioners to adjust the tariff price for patients incurring lower costs than the average for the tariff category. It is unclear whether current data on costs in the NHS are adequate to support this arrangement for price flexibility. If local prices are lower than the tariff it will be important that the quality of care for patients in this care category is also monitored very carefully.’

We note the commitment for all NHS Trusts to achieve foundation trust status either on their own or by merging with another organisation by April 2014. Research evidence shows that merger frequently postpones rather than resolves financial underperformance whilst reducing choice. Furthermore all NHS Trusts are expected to recover their financial performance next year which will be particularly difficult in London – quarter 1 figures show that across the city Trusts were forecasting a deficit of over £100m in 2011/12.