As councils and clinical commissioning groups complete the first stage of the huge task of deciding how to integrate services under the government’s £3.8bn better care fund, ministers are offering a concession.
Care services minister Norman Lamb (Lib Dem) and local government minister Brandon Lewis (Con) announced in exclusive interviews with LGC and its sister title Health Service Journal that they had removed the threat of financial penalties for areas that failed to meet national and local targets for 2015-16.
“We’ve deliberately decided it would be inappropriate to withdraw funds for areas that failed to hit targets,” Lamb said. “There would be a law of unintended consequences.”
Lewis, whose other role as floods minister thwarted a plan for a joint interview with his colleague, explained the change of heart in a later interview with LGC.
“If we were to penalise somebody in the very early stages, actually all we’d be doing is penalising the users of the services,” he said.
However, he suggested the £1bn performance-related element, which he said was originally introduced because “local government, the NHS and the public sector tend to respond and react positively to that kind of incentive”, could one day be brought back.
The relaxation of rules “doesn’t mean that in future, areas that drop back won’t lose out”, he warned.
Instead of financial penalties in 2015-16, areas that fail to reduce delayed transfers of care, unplanned emergency admissions to hospital and a set of other outcomes, will receive support from the LGA and NHS England.
“People won’t want to have to concede they need help, so there’s a driver there to achieve better care,” Lamb said.
However, there is a difference in tone from the ministers on the approach this “support” could take. Lamb strikes a conciliatory approach. “I absolutely don’t want it to be the commissars coming in and imposing a different model,” he said.
But Lewis is more direct. “Obviously if areas don’t get it right we’ll have to look at what they’re doing. We reserve the right to put in people who can design a good scheme,” he said.
Also in the interview, which marks the 14 February deadline for the submission of initial plans for the better care fund, Lamb said it was “just wrong” to suggest the programme would allow councils to use NHS funds to fill potholes – a concern highlighted by NHS England’s medical director Sir Bruce Keogh at a health select committee last month.
“We will not let that happen,” he said.
Lewis was similarly frank when asked whether he’d tackled Sir Bruce over the claims. “I haven’t seen him, but I don’t agree with him,” he said. “I’m confident that won’t happen. Local government will do the right thing, as it generally does.”
Part of the problem behind Sir Bruce’s concerns, Lewis said, was that the actions of some councils caused a loss of confidence in the sector as a whole.
“We had a question in the House of Commons because Enfield LBC was being accused of using public health money to grit the roads or re-tarmac the roads, I can’t remember which,” he said.
“They had this tenuous argument that it would stop people having accidents. That does nobody in local government any favours and it’s an atrocious way to behave.
“But that isn’t local government. Local councils across the country know what this is about and they’ve got a vested interest in getting it right. The Enfield example is a salutary lesson to every council that that won’t be tolerated, they won’t get away with it.”
Yet Sir Bruce’s concerns reflect serious misgivings in the acute sector about the prospect of a major transfer from their budgets to social care.
Not least among these is the fear of a “cliff edge” because, according to figures from NHS England, the better care fund is expected to cause a 15% reduction in emergency activity – an outcome that could be hugely destabilising for the NHS if it were not carefully managed.
Lewis said he understood the acute sector’s concerns, “because they see this continual rise in demand and actually we need to prove it can start to fall”.
“One of the ways we’ll know this is working is if that demand falls,” he said. “In a sense if we need less A&E because we’ve dealt with the problem, that’s a good thing. Obviously the NHS will need to manage that transition.”
For his part, Lamb said nervousness in the acute sector was “exactly what one would expect at this stage”.
“Hospitals have become reliant on payment by results as a method of funding, and starting the shift away from that inevitably causes concerns,” he said.
“But you have to look at the counterfactual all the time. You can point to the pressures and the risks of proceeding down the right route, but we have to look at what happens if you carry on with business as usual. For me that results in the NHS crashing, and that’s a scenario we’ve got to avoid.”
Some areas, such as Oxfordshire where NHS providers effectively put the brakes on an ambitious integration plan late last year, have hit major obstacles to integration. Does this concern the minister?
“I think it’s fair to say the system as a whole is enormously risk averse, this is the culture in the NHS and understandably so,” Lamb said. “The approach nationally has been strong direction from the centre, and any divergence has been challenged and questioned and criticised.
He said his 14 local integration “pioneer” areas were starting to change this approach. He said these areas had become “all the more important” since the introduction of the better care fund because other areas would look to them for lessons.
To this end, he said, the 14 pioneer sites would be able to go directly to some of the most senior figures in the NHS and local government for support. This included the Department of Health’s director-general for social care Jon Rouse, NHS England’s national policy director Bill McCarthy and LGA chief executive Carolyn Downs.
“If we can get to understand better what the barriers are to sorting out a problem like delayed transfers of care and then rapidly disseminate that…you avoid too high a risk of making mistakes,” he said.
Both ministers suggest the fund, if successful, could have significant implications for future reform.
For Lamb, who is clear that this is a personal view rather than the policy of his department, sharing the £3.8bn is a step towards “the pooling of the whole health and care resource in a local area”.
“The more we can achieve a rational use of the whole resource in an area, whether it’s commissioned by NHS England, CCGs or local authorities, it’s rational to try to,” he said.
And for Lewis it fits in neatly with wider local government reform programmes such as the troubled families programme and community budgets, both of which focus on joint working and preventing duplication.
“The better care fund will prove local government can work in partnership to lead and facilitate the delivery of public services,” he said.
“If you look at what the fund is doing, in its purest ethos it is the community budget pilot, it’s working together with a joined-up approach.
“If we get this right it opens up much more for the future, and it confirms that everything we’ve done with the community budget pilots can be rolled out more widely and that’s something I’m really keen to see.”
What is the better care fund?
Announcing the government’s spending round in June 2013, chancellor George Osborne said £3.8bn would be shared between local government and the NHS in 2015-16.
A transfer of funds from the NHS to councils’ social care budgets has taken place on an annual basis since 2011, and the value of the transfer has risen gradually every year, reaching £1bn in 2014-15.
The extra money comes in large part from a top-slice of CCG budgets.
Plans to spend the money have to be agreed by local health and wellbeing boards, and the fund is expected to achieve a series of nationally set outcomes. These include reducing delayed transfers of care, avoidable emergency hospital admissions and admissions to residential care, and making re-ablement services more effective.
In December, planning guidance published by NHS England said payment of £1bn of the total in 2015-16 would be dependent on local performance in meeting national and local outcomes.
This led to fears that struggling areas would face a “double whammy” of losing funds at a time when more money would be needed to prop up the acute sector as a result of a struggling integration plan.
However, the ministers have confirmed this will no longer be the case.