South West

South West ICBs –  a postcode lottery

By John Lister

This latest Lowdown survey of the seven Integrated Care Boards (ICBs) covering the South West of England has revealed a complete spectrum of situations, plans, proposals and solutions to the generic problems facing all ICBs – historic under-funding, inflation, inadequate capacity, staff shortages, gaps in social care, and NHS England pressure to cut spending to match budgets.

The financial situation of Integrated Care Systems (ICSs), according to the most recent published reports, range from a deficit of just £2.8m in Gloucestershire to £39.7m in Devon, while Cornwall and Isles of Scilly reports only a “variation from plan” (£5.1m) rather than a deficit. Somerset is the only ICS in England to identify the scale of the local authority’s current (£26m) deficit on social care and include it in an ICS total, bringing the deficit up to £34.5m.

The combined deficits from 6 of the 7 South West ICBs that reported a figure was £164m: in several of the ICBs this has been enough to result in various efforts to save money, including plans in mental health to substitute HCAs for high-cost agency RMNs (Bath and NE Somerset p99) and various plans to cut bed numbers, relying on Discharge to Assess.

One common factor running through all of the South West systems is that almost none of the plans for so-called “efficiency savings” are clearly explained, nor are the potential costs of new systems revealed. This problem affects even schemes that appear promising such as Cornwall’s Mental Health Concordat, Devon’s Winter Plan to work around a shortfall in bed numbers this coming winter, and Dorset’s plan for ‘Integrated Neighbourhood Teams’.

In each case if any financial figures quoted they are only listing the level of savings each ICB hopes will be generated from the scheme. But without a serious estimate of capital and revenue costs – along with staffing requirements – it is impossible to judge the chances that the potential benefits may actually be delivered.

Bath and North East Somerset, Swindon and Wiltshire (BSWICB)

The September ICB Board heard that the first draft of the Medium-Term Financial Plan was submitted to the NHS England regional team on the 8th September 2023. It is a three-year plan; Year 1 of the plan is 2023/24.

However there are serious problems to confront, not least the need to “invest” to expand some services:

“We are developing our medium term financial plan in the context of striving to address our existing financial deficit and our productivity gaps, as well as aiming to deliver on our strategic ambition of improving outcomes and increasing our focus on prevention and early intervention.

“This will, in the long term, help to curtail growth in secondary care ….

“To facilitate this shift, we need to invest in prevention and early intervention, dealing with the current demand on our acute services, whilst also developing our productivity and cost reduction schemes.”

However, all this is much easier said than done: “at this stage it appears unlikely that BSW will be able to present a balanced plan within 3 years.” (p22)

The Month 4 system deficit was £19.8m, £11.1m worse than the planned deficit, and the increasingly faint hopes of the system breaking even depend upon achieving £96.3m of efficiencies (equivalent to 5.1% of the ICS allocation). (p197)

The other problem is that over a third of the efficiencies planned are non-recurrent, piling up more problems for next year and beyond, 21% are seen as “high risk”, and over 8% were either still unidentified or only listed as “opportunities” at Month 4.

BSWICB reports that the main issue knocking budgets off course has been prescribing prices (£3.8m by month 4) along with Industrial Action £2.4m, and costs of Agency staff £1.9m. (p200) Elsewhere the ICB is warned that the local full year cost of prescribing inflation could be more than £10m. (p21)

However there are no reserves or contingency to manage the financial position so the deterioration in the year-to-date position has resulted in more short term stopgap solutions: “the deviation from plan being managed by non-recurrent measures.” (p200)

Use of the independent sector to help achieve the elective care target of 107% of 2019/20 levels is listed as a risk that could leave the ICS with a bill: “over-performance on the independent sector … will be funded nationally only if we exceed our elective target.” The potential risk at Month 4 was £4m. (p21)

The independent sector (undefined as to which services are involved) was running at 130% of plan at Month 4, after a recent highest month of 160%: this makes the process of attempting to balance the books of the system even more complicated. (p207)

Agency staff

BSWICB is openly looking at substituting less qualified staff in mental health care, to save money: “AWP [Avon and Wiltshire Partnership] are exploring the option of supplying senior HCA to the acute partners to reduce the reliance on high-cost agency RMNs, this should also have benefits on AWPs workforce, with less RMN usage within the acutes [acute hospitals].”  (p99)

Bristol, North Somerset and South Gloucestershire (BNSSG ICB)

The October ICB Board heard that at the end of August (month 5), the BNSSG system reported an actual deficit of £25.3m, £11.4m worse than plan. This represented a £10.1m shortfall among providers, and an ICB “adverse variance to plan” of £1.3m. However with a relatively modest target of £58m efficiencies the system is maintaining its forecast of break-even at year end, “both at system, and constituent organisation level.” (p2)

There is an extra pressure to deliver a balanced budget: the threat that the ICB could be saddled with years of repayments of previous overspending.

“The ICB was established with an accumulated brought-forward debt of £117m derived from net historical clinical commissioning group (CCG) overspends. If the system and ICB achieve breakeven in 2023/24 (having achieved this in 2022/23), the historic debt will be written off. Failure to deliver this breakeven requirement will have the balance reinstated and it will therefore become repayable at c£8.9m per year (0.5% of ICB allocation)” (p3)

But while this penalty for failure and the overall financial problems may seem relatively mild, the performance in BNSSG is still falling way short of targets. The Performance Report as of September 2023, (presented to the October Board) lists a long series of failures and worsening performance, from 4 hour waits in A&E, to the total waiting list (BNSSG performance ranked 23rd out of 42 ICBs nationally and 5th out of 7 ICBs in the Southwest.

The situation had worsened for numbers of BNSSG patients waiting 52 weeks or more; numbers waiting over 65 weeks, over 78 weeks and over 104 weeks.

There were also worse figures for 28 day faster diagnosis standard for BNSSG cancer patients. Only the 2 week wait for cancer patients improved in July, although the 93% national standard “has not been achieved at population level since June 2020.”  (p3)

The Winter Planning Submission is cryptic in presentation . It seems to be proposing substantial reduction in community beds through the winter, based on a Discharge to Assess (D2A) model.  Asked to supply “ICB level monthly plans for the community beds available,” the response appears to spell out plans for cutting 75 beds (24% of capacity) this month for the coming winter:

“Submission will reflect current [community] bed volumes for Oct-23 (313), then a reduction to 238 from Nov-23 for the remainder of the year, in line with D2A proposals and shift to non-bedded pathways.” (p15/15)

However the submission includes no real discussion of finance or staffing to ensure the new system can meet local needs.

Cornwall and Isles of Scilly ICB

CIoS is one of the ICBs that annoyingly publish separate papers on each agenda item rather than a single pack per Board meeting that can be searched. They have also avoided giving any explicit financial report on the state of play across the system.

The ICB chief financial officer provided a verbal update to the September Board, stating only that the year-to-date position as at Month 4 showed “a £4.7m deterioration from plan,” but without telling Board members what the actual deficit was, or what the plan was.

It was noted that £2.7m of the deficit is “the direct impact of ongoing industrial action,” and that “clarification is being sought nationally on the funding mechanism for those periods of industrial action which have already taken place.” (p3)

However it seems that the ministers who have been so stubborn in refusing to restore the hefty real terms loss of earnings of medical staff have been less keen to help the trusts foot the bills for extra agency staff and overtime working.

The ICB is unusual in making light of increases in prescribing costs, running at an annual rate of 12%. (p65)

In the most recent Finance report (Month 5) the ICS “adverse variance” has increased to £5.1m, while the efficiency savings are £3.5m short of target levels. Despite the relatively small scale of the deficit, the ICB is still doggedly focused on balancing the books through undisclosed “efficiencies”:

“Delivery of efficiencies, both in total and in recurrent terms, remains the most challenging financial risk we face this year, with potential impact into 2024/25 if recurrent efficiencies fall below plan.” (p8)

While winter/urgent care had shown “some areas of improvement through the summer,” it seems the system is less likely to cope in the winter: “pressures over the last two weeks have highlighted the system fragility and the need for the mobilisation and delivery of robust winter plans and our intermediate care plans.” (p4)

Questions to the Board revealed that CIoS discharged 80% of patients home without support in 2022, much higher than the 50% target set in national guidance for Discharge Pathways. The answers also showed that Cornwall Foundation Trust operates 271 core community beds across Cornwall and the Isles of Scilly, while the ICB commissions a further 15 short-term reablement and rehabilitation beds from the Kenwyn Care Home in Truro. But there are hopes to reduce this provision:

“as the average length of stay reduces in community hospital beds and more people are discharged straight home … and not into a community hospital bed demand for community hospital beds will reduce.” (pages 7-8)

What appears to be a positive Prevention Concordat for Better Mental Health turns out to be too vague to be useful, setting out no costings for the necessary improvements to deliver substantial financial savings which give an added incentive to invest more in preventive measures.

“self harm and suicide prevention has been found to return a total of £12.96 per pound spent in years two to five. In the long term, this increased to £39.11 per pound spent in years six to ten. (p3)

“There are substantial personal and economic costs associated with reduced mental wellbeing, self-harming and dying by suicide. For example, suicides and non-fatal suicidal events, with an estimated average cost of £1.67m (2009 prices) per suicide of working age person.” (p9)

Independent sector

The ICB was reported “on track to deliver the 65 week wait objectives by the end of March 2024,” with the exception of orthopaedics, which were to be “reset,” with a week-by-week trajectory “regional support:”

“Key elements of the reset will be clinical leadership, identifying and embedding new ways of working, extending theatre days and weekend working, further use of choice, and commissioning of additional private provider capacity.” (p4)

The ICB’s Annual Report reveals the extent to which the private sector has also played a role in tackling waiting lists for the simplest ophthalmic services, with all medium and low risk cataract activity transferred away from Royal Cornwall Hospitals NHS Trust “to one of our community providers; Probus Surgical Centre.” The Probus website shows it specialises in a wide range of simpler procedures “including; vasectomy, hands and feet, general surgery and ophthalmology.”

Shifting this work increased the RCHT capacity for “urgent and higher priority care streams,” and resulted in significantly shorter waiting times for cataract surgery compared to national targets.

The ICB has also developed a “cataract choice framework”, which went live in the spring of 2023, and gives patient “greater choice as to where they want to be treated whilst bringing down waiting times even further across the system.” (p58)

An “Independent sector community diagnostic centre” is due to open in Redruth in April 2024 (p22)

Devon ICB

The ICS is still predicting a (strangely precise) year-end deficit of £42.3m: but by the end of August (Month 4) the actual deficit against plan was already £39.7m.

On the plus side the system’s agency spending was the lowest in the South West region, and efficiency savings were exceeding plan by £11.5m, raising hopes of delivering the full target of £212m. Net risks to limiting the deficit to £42.3m had been reduced from £160m to £106m. (p18)

However the performance on patient care had deteriorated on most fronts. Ambulance handover delays above 15 minutes rose by 33% in August. 4-hour A&E performance and 12-hour waits in A&E both worsened, along with Category 2 ambulance response times. In the hopes of getting better statistics, Urgent and Emergency Care was focusing on 7 Key areas as well as performance on “minors” (Type 3 attenders), as well as “overnight performance, patients that breach between 4-5 hours and virtual ward utilisation.” (p23)

Children & Young People (CYP): Autism Diagnosis was also falling behind, with numbers waiting increased so that “The target cannot be met within current service provision capacity.”

“Waits have been impacted by an increase in number of referrals when schools returned after lockdown with referrals continuing at high levels.”

Another problem is “High levels of children being referred with greater complexity making the assessment process longer. For instance, in Torbay 60% are considered complex when compared to rest of Devon 30% complex.”

Only after running through other explanations for the growing delays in treatment does the report mention the key capacity issue: “60% vacancy rate within CFHD [Children and Family Health Devon].” (p53)

With the ICS target deficit dependent upon the ICB itself underspending by £48.6m (p173), to counterbalance acute trusts delivering end of year deficits totalling over £90m, (p187) which still required “full achievement of efficiency targets of £146m.” (p188)

But by month 5 there was a year to date ICB overspend of £6.9m. This is described as a result of excess spending on private providers – spending which the ICS may not be able to get back: (“payments for Elective Recovery Funding in the independent sector, with an expectation that a future allocation will cover this cost”). (p173)

But if things are hard this  year, they are set to get much harder over the next four years as the ICS budget is scaled back from historically higher spending to its ‘fair share’ of NHS spending per head:

“For 2023/24, Devon ICB is funded above its ‘fair share’ level by £109.5m and the Operational Plan provides for a further £42.4m spend above that amount. Therefore, overall, Devon will this year spend £151.9m above its fair share level.

“This means that each LCP [Local Care Partnership ] area is also funded above its fair share level.”

To remedy this:

“For 2024/25, it is forecast that Devon ICB will be funded at £79.5m above its fair share level and the medium term financial plan currently provides for a further £30m spend above that amount. Devon is therefore planning to spend a total of £109.5m above its ‘fair share’ level in 2024/25. This means that each LCP will also be funded above its ‘fair share’ level next year.

“The current financial settlement is only known to the end of 2024/25, but Devon ICB’s allocated funding will continue to be reduced to bring the ICB to its ‘fair share’ funding target in a process known as ‘convergence’ over the medium term.” (p193)

“The assumed pace of this change is £30m per annum, and so will be achieved within four years.”

As a result, there will be initially a reduction in provider top up funding, “and when that is exhausted a weighted capitation share to each locality. Providers and localities will need to reduce expenditure accordingly.” (p196)

The Winter Planning proposals note that “Based on the initial outputs of the system demand model shows that the Devon system could be in a bed deficit position of -396 beds in January 2024 if no mitigations are put in place.” (p209)

However the ‘mitigations’ that are reported (p210) – even if they are both delivered in full – fall  almost halfway short of plugging the gap, adding up to just 200.9:

“The accelerated rollout of virtual wards is expected to reduce the peak bed deficit from 396 to 305 beds,” [91] and “a number of additional schemes to further mitigate against impact of the winter surge. This additional capacity is made up of both existing and new schemes and aims to reduce the bed deficit by 53.5 beds (109.9 including existing schemes)” (p210)

A “full list of schemes,” is promised in Appendix 1 — which is not included in the document pack. But it seems certain that Devon, “with a very small hospital bed base relative to the population it serves” (p210) is headed for a seriously difficult winter, with too few beds and no real plan to cope.

Use of private sector

Devon is unusual in revealing the extent to which its Urgent and Emergency services and specifically Ambulance response times rely on use of the private sector “Additional frontline resources hours are being funded through the UEC recovery fund. This includes maintaining and increasing private provider capacity…” (p31)

Private providers are also seen as important for elective care: “Additional capacity at independent sector partners continues to be sought through weekly meetings.” (p39)

Perhaps it’s not surprising to see relatively high levels of spending flowing out of the NHS: “Full Year forecast spending on independent sector: £37.5m.” (p183)

Dorset ICB

The November Board papers reveal a deterioration in the financial position from a £7.2m deficit at Month 4 to a £20m deficit at Month 6.

The ICB tries unconvincingly to pin the blame for the financial situation on “Operational pressures relating to the Industrial Action,” but undermines this by revealing that  the estimated cost was just “£3.2m to date (£2.8m Month 5) relating to both medical and nursing costs.” (p57)

By contrast “inflationary pressures above the level assumed in national modelling are estimated to have contributed £3.7m to the year to date deficit …  with the biggest movement continuing to be driven by energy prices.” (p62)

Another factor is mentioned without saying how much money is potentially involved:

“There is also a risk around Independent Sector Providers, which saw very high activity growth in 2022/23. It is expected that this growth will continue into 2023/24 based on current activity data. Should the ICB exceed the ERF target of 106% of 19/20 activity levels it is expected that excess activity will be funded. However, should the ISP’s overperform and the ICB in total does not meet or exceed the overall 106% target, this would need to be funded from clawback of under activity from NHS providers. (p62)

The hospital trusts are also in the red:

“University Hospitals Dorset: At the end of September 2023 the Trust has reported a deficit of £17.9 million against a planned deficit of £5.6 million representing an adverse variance of £12.3 million.

Dorset County Hospital is blaming its deficit on a whole host of problems “above plan agency usage …” including” ongoing cover for vacancy and sickness gaps, operational pressures and supporting a 23 expanded bed base contributed in part by sustained numbers of no criteria to reside patients.” Plus “Above planned levels of inflation … with electricity 65% higher than planned levels, with catering supplies, blood product contract increases of up to 13.5% and other contract increases above planned levels.” (p65)

Agency spending across the ICS is expected to hit £53m, compared with a target of just £44m.

The ICB is the only one of 42 in England to single out increased costs of “Personal Health Commissioning (PHC) budgets” as a factor in their deficit, noting “current estimates are that an additional £28.1m will be required in 2023/24, which represents an increase of 26% on last year’s spend.” (p58)

The ICB has an embarrassingly long list of areas in which system performance is falling short of target:

• Virtual ward utilisation.
• Virtual ward capacity.
• Patient waiting beyond 65-weeks for planned care.
• 106% activity, compared to 2019/20.
• Advice and guidance.
• Patient initiative follow-ups.
• Theatre utilisation.
• Day case rates.
• Reduction in follow-up outpatients.
• Cancer faster diagnosis standards.
• 62-day cancer backlog.
• Reduction in patients with no criteria to reside.
• Reducing mental health adult acute out of area placements.
• Increasing the number of adults and older people accessing psychological therapies (NHS Talking Therapies).
• Overall access to core community mental health services for adults and older adults with severe mental illness.
• Children and young people mental health service access.
• Improving access to perinatal mental health services.
• Dementia diagnosis rates. (p68)

There is also a sorry report of under-achievement on the roll-out of virtual ward beds:

“At the end of August, 128 virtual ward beds were operational, although the Integrated Community Care Model includes 60 remote monitoring beds, not counted in the current capacity, which would raise it to 188 beds. However, only 37% [47] of the 128 virtual ward beds were occupied. This is … an underperformance against trajectory by 38.22%, equating to 102 beds fewer than the 230 expected beds.” (p86)

Perhaps it’s no surprise in the light of this that “all planned care standards except for the reduction in the total waiting list, are underperforming against trajectory,” (P71) and “Mental health performance, across all standards, is of concern. Performance against all standards outlined in the operating plan are under the agreed trajectory.” (p75)

A 265-page Plan for Integrated Neighbourhood Teams repeatedly claims possible savings, but nowhere states how much would have to be invested to deliver such results, or where it would come from.

It states, for example:

“There is a substantial opportunity to improve system productivity by investing in community care, which can unlock benefits for local citizens and the broader economy. Our analysis suggests that such a shift could save the typical-sized integrated care system (ICS) around £26 million in reduced acute demand alone, in addition to the vital and wider positive economic footprint that our earlier work has shown healthy populations engender. (p89)

And again: “The reduction in acute demand associated with this higher community spend could fund itself through savings on acute activity … with an average 31 per cent return on investment and average net saving of £26 million for an average-sized ICS, exemplifying the power of community care at a system level.” (93-4)

And at a time of desperate shortages of GPs as their workload expands, the document also argues “The analysis specifically found that the impact of adding one GP for 10,000 people equates to an estimated reduction in cost to be £82,071, relative to need.” (p98)

Gloucestershire ICB

As of time of writing (November 2) the only Board papers are from back in September, giving financial figures up to Month 5. These show the ICS with a deficit of £2.8m at the end of July, and warn:

“The ICS continues to face a number of significant financial pressures and there remains a high risk of non-delivery of an overall system breakeven position.

“The financial pressures include:

• ICB prescribing item and price increases.
• Workforce pressures leading to high expenditure on agency and locum staff.
• Medicines division pressures within GHFT.
• Impact of industrial action on operating costs and activity levels.
• Ongoing inflationary pressures – pay and price and demand and growth pressures, including recurrent pressures from 22/23 built into
• the 23/24 plan. There is growing evidence that suggests inflation in specific areas will continue.
• Slippage in the delivery of savings plans.
• A proportion of current pressures are being mitigated through non-recurrent savings, slippage in investments and non recurrent measures.” (p56)

Although the full year target for efficiency savings is relatively light at £57.7m (p80), the ICS financial plan for 23/24 is a breakeven position for the system, and for each organisation:

“this includes a high level of savings and also a number of non recurrent financial savings, efficiencies and income.” (p75)

It still faces a challenge:

“The ICB must show how it planned to break even in 2024/2025 and how a recurrent financial balance could be achieved across that period. The timescale will be challenging, and there was a huge amount of work being undertaken which would come back to the Board and committees across the system in September 2023.” (p11)

Independent sector

“Elective recovery was behind plan as were NHS providers, but the independent sector was on plan. Other pressures included the pay award and children’s placements.” (p11)

Year to date ICB commissioned activity was at 99.6% of the value weighted target –  because under delivery by Gloucestershire Hospitals (92.3%) and out of county NHS providers (82.5%) was offset by Independent Sector providers overperformance (131.6%). (p78)

Somerset ICB

Somerset, too  has only published Board papers up to September, and included only minimal financial information or detail on performance. The minutes of the previous Board are cryptic:

“The system submitted a balanced plan for 2023/24 both on an individual organisation and system basis. Against this plan, there is an overspend of £547,000 to the end of May.

It is anticipated that NHS Somerset will deliver a breakeven position for the end of this financial year.” (p10)

However Somerset seems to be unique among ICSs in spelling out the scale of the local authority’s deficit and including that in the summary of the financial situation: with NHS finances among the very few ICSs to be almost balanced, the local authority (social care) position has created an ICS deficit of £34.5m:

“NHS Somerset is forecasting to deliver a balanced outturn position for the 2023/24 financial year. At month 4, NHS Somerset has a year to date overspend of £3.4m. Somerset ICB’s year-to-date variance predominantly relates to Prescribing costs exceeding plan by £2.0m. Somerset FT’s £1.2m in-year adverse position is driven by additional costs relating to industrial action.” However:

“Somerset Council are projecting a £26.1m overspend at month 4, which is slightly improved from month 3, and largely driven by pressures within Adult Social Care and Children’s Social Care.” (p4)

The limited financial reports for Somerset give no details of any underlying deficits, nor do they discuss the 2023/24 target for efficiency savings.

The impression this creates is of a complacent and relatively well-funded ICB that is happy to let things drift with bi-monthly meetings, and leave the local authority to take the blame for any deficits.

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