Agenda item A4(i)
NEWCASTLE UPON TYNE HOSPITALS NHS FOUNDATION TRUST
EXECUTIVE REPORT - CURRENT ISSUES
1.
Executive Team
Particular attention is drawn to:
i)
Addressing the consequences of extraordinary pressures across the
emergency care caseload presentation and all this entails.
ii)
Commissioning of the Clinical Resource Buildings (Phase 8) Royal Victoria
Infirmary redevelopment.
iii)
Preparation for the commencement of Phase 9 (Royal Victoria Infirmary) of
the Transforming Newcastle Hospitals Investment Programme (Private
Finance Initiative).
iv)
Taking steps to ensure minimal disruption arising out of the national industrial
action by junior medical staff.
v)
Providing an extensive multi-factorial portfolio of documentation/data to the
Care Quality Commission in relation to a whole organisation Inspection – 19th
January - 22nd January 2016.
vi)
Engagement with respective commissioners of service to firm up the Order
Book 2016/17.
vii)
Action taken in relation to the ongoing service level impact, subsequent to the
Northumbria Healthcare hospital site reconfiguration, dating back to June
2015 and the introduction of a Specialist Emergency Care Hospital, East
Cramlington.
viii)
The ‘coming together’ of ‘health and care’ systems in accordance with the
philosophy and direction promulgated in the NHS Five Year Forward View
(Planning Guidance 2016/17-2020/21) involving informed dialogue across
Greater Tyneside and Northumberland.
ix)
Investment planning from a service infrastructure, care quality and staffing
skills/retention perspective.
x)
Analysing the impact (benefit or otherwise) of the NHS Improvement
promulgated Sustainability and Transformation Fund from the perspective of
an NHS Foundation Trust.
xi)
Ongoing engagement with the West North and East Cumbria Success
Regime in the endeavour to bring about an essential renaissance of
healthcare delivery in acute service settings linked to North Cumbria
University Hospitals NHS Trust.
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2.
Key Impact Documents/Statements from Government/Regulators/Advisory
Bodies/ Others
(i)
Delivering the Forward View NHS Planning Guidance 2016/17 – 2020/21
Published on 22nd December 2015 and prepared by: NHS England, NHS
Improvement (Monitor and the NHS Trust Development Authority), Care Quality
Commission (CQC), Health Education England (HEE), National Institute of Health
and Care Excellence (NICE), and Public Health England (PHE).
For ease of reference the following key statements are of particular note:

The Spending Review provided the NHS in England with a credible basis on
which to accomplish three interdependent and essential tasks: first, to
implement the Five Year Forward View; second, to restore and maintain
financial balance; and third, to deliver core access and quality standards for
patients.

It included an £8.4 billion real terms increase by 2020/21, front-loaded. With
these resources, we now need to close the health and wellbeing gap, the
care and quality gap, and the finance and efficiency gap.

In this document, authored by the six national NHS bodies, we set out a clear
list of national priorities for 2016/17 and longer-term challenges for local
systems, together with financial assumptions and business rules. We reflect
the settlement reached with the Government through its new Mandate to
NHS England. For the first time, the Mandate is not solely for the
commissioning system, but sets objectives for the NHS as a whole.

We are requiring the NHS to produce two separate but connected plans:
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A five year Sustainability and Transformation Plan (STP), place-based
and driving the Five Year Forward View; and
A one year Operational Plan for 2016/17, organisation-based but
consistent with the emerging STP.

The scale of what we need to do in future depends on how well we end the
current year. The 2016/17 financial challenge for each Trust will be
contingent upon its end-of-year financial outturn, and the winter period calls
for a relentless focus on maintaining standards in emergency care. It is also
the case that local NHS systems will only become sustainable if they
accelerate their work on prevention and care redesign. We don’t have the
luxury of waiting until perfect plans are completed. So we ask local systems,
early in the New Year, to go faster on transformation in a few priority areas,
as a way of building momentum.

We are asking every health and care system to come together, to create its
own ambitious local blueprint for accelerating its implementation of the
Forward View. STPs will cover the period between October 2016 and March
2021, and will be subject to formal assessment in July 2016 following
submission in June 2016. We are asking the NHS to spend the next six
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months delivering core access, quality and financial standards while planning
properly for the next five years.

Planning by individual institutions will increasingly be supplemented with
planning by place for local populations. For many years now, the NHS has
emphasised an organisational separation and autonomy that doesn’t make
sense to staff or the patients and communities they serve.

System leadership is needed. Producing a STP is not just about writing a
document, nor is it a job that can be outsourced or delegated. Instead it
involves five things: (i) local leaders coming together as a team;
(ii) developing a shared vision with the local community, which also involves
Local Government as appropriate; (iii) programming a coherent set of
activities to make it happen; (iv) execution against plan; and (v) learning and
adapting. Where collaborative and capable leadership can’t be found, NHS
England and NHS Improvement will need to help secure remedies through
more joined-up and effective system oversight.

Success also depends on having an open, engaging, and iterative process
that harnesses the energies of clinicians, patients, carers, citizens, and local
community partners including the independent and voluntary sectors, and
Local Government through Health and Wellbeing Boards.

As a truly place-based plan, the STPs must cover all areas of CCG and NHS
England commissioned activity including: (i) specialised services, where the
planning will be led from the 10 collaborative commissioning hubs; and (ii)
primary medical care, and do so from a local CCG perspective, irrespective
of delegation arrangements. The STP must also cover better integration with
Local Authority services, including, but not limited to, prevention and social
care, reflecting local agreed health and wellbeing strategies.

For the first time, the local NHS planning process will have significant central
money attached. The STPs will become the single application and approval
process for being accepted onto programmes with transformational funding
for 2017/18 onwards. This step is intended to reduce bureaucracy and help
with the local join-up of multiple national initiatives.

The Spending Review provided additional dedicated funding streams for
transformational change, building up over the next five years. This protected
funding is for initiatives such as the spread of new care models through and
beyond the Vanguards, primary care access and infrastructure, technology
roll-out, and to drive clinical priorities such as diabetes prevention, learning
disability, cancer and mental health. Many of these streams of
transformation funding form part of the new wider national Sustainability and
Transformation Fund (STF). For 2016/17 only, to enable timely allocation,
the limited available additional transformation funding will continue to be run
through separate processes.
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
The most compelling and credible STPs will secure the earliest additional
funding from April 2017 onwards. The process will be iterative. NHS England
is to consider:
-
-
The quality of plans, particularly the scale of ambition and track record of
progress already made. The best plans will have a clear and powerful
vision. They will create coherence across different elements, for example
a prevention plan; self-care and patient empowerment; workforce; digital;
new care models; and finance. They will systematically borrow good
practice from other geographies, and adopt national frameworks;
The reach and quality of the local process, including community,
voluntary sector and Local Authority engagement;
The strength and unity of local system leadership and partnerships, with
clear governance structures to deliver them; and
How confident we are that a clear sequence of implementation actions
will follow as intended, through defined governance and demonstrable
capabilities.

The strategic planning process is intended to be developmental and
supportive as well as hard-edged. A list of ‘national challenges’ to help local
systems set out their ambitions for their populations is provided. This list of
questions includes the objectives set in the Mandate. It is stressed - do not
over-interpret the list as a narrow template for what constitutes a good local
plan: the most important initial task is to create a clear overall vision and plan
for your area.

Local health systems now need to develop their own system wide local
financial sustainability plan as part of their STP. Spanning providers and
commissioners, these plans will set out the mixture of demand moderation,
allocative efficiency, provider productivity, and income generation required
for the NHS locally to balance its books.

The STP will be the umbrella plan, holding underneath it a number of
different specific delivery plans, some of which will necessarily be on different
geographical footprints. For example, planning for urgent and emergency
care will range across multiple levels: a locality focus for enhanced primary
care right through to major trauma centres.

The first critical task is for local health and care systems to consider their
transformation footprint – the geographic scope of their STP. Proposals are
sought by 29th January 2016, for national agreement. Local Authorities
should be engaged with these proposals. Taken together, all the
transformation footprints must form a complete national map. The scale of
the planning task may point to larger rather than smaller footprints.

Transformation footprints should be locally defined, based on natural
communities, existing working relationships, patient flows and take account
of the scale needed to deliver the services, transformation and public health
programmes required, and how it best fits with other footprints such as local
digital roadmaps and learning disability units of planning. In future years we
will be open to simplifying some of these arrangements. Where geographies
are already involved in the Success Regime, or devolution bids, we would
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expect these to determine the transformation footprint. Although it is
important to get this right, there is no single right answer. The footprints may
well adapt over time. We want people to focus their energies on the content
of plans rather than have lengthy debates about boundaries.

We will issue further brief guidance on the STP process in January. This will
set out the timetable and early phasing of national products and engagement
events that are intended to make it much easier to answer the challenges we
have posed, and include how local areas can best involve their local
communities in creating their STPs, building on the ‘six principles’ created to
support the delivery of the Five Year Forward View. By Spring 2016, NHS
England intend to develop and make available roadmaps for national
transformation initiatives.

Early reactions are sought by 29th January 2016, as to what additional
material NHS organisations would find most helpful in developing your STP.
NHS England would also wish to work with a few local systems to develop
exemplar, fast-tracked plans.
Beyond the above there are nine ‘must dos’ in 2016/17 for every local system:
i)
Develop a high quality and agreed STP, and subsequently achieve what you
determine are your most locally critical milestones for accelerating progress
in 2016/17 towards achieving the triple aim as set out in the Forward View.
ii)
Return the system to aggregate financial balance. This includes secondary
care providers delivering efficiency savings through actively engaging with
the Lord Carter provider productivity work programme and complying with the
maximum total agency spend and hourly rates set out by NHS Improvement.
CCGs will additionally be expected to deliver savings by tackling
unwarranted variation in demand through implementing the RightCare
programme in every locality.
iii)
Develop and implement a local plan to address the sustainability and quality
of general practice, including workforce and workload issues.
iv)
Get back on track with access standards for A&E and ambulance waits,
ensuring more than 95 percent of patients wait no more than four hours in
A&E, and that all ambulance Trusts respond to 75 percent of Category A
calls within eight minutes; including through making progress in implementing
the urgent and emergency care review and associated ambulance standard
pilots.
v)
Improvement against and maintenance of the NHS Constitution standards
that more than 92 percent of patients on non-emergency pathways wait no
more than 18 weeks from referral to treatment, including offering patient
choice.
vi)
Deliver the NHS Constitution 62 day cancer waiting standard, including by
securing adequate diagnostic capacity; continue to deliver the constitutional
two week and 31 day cancer standards and make progress in improving oneyear survival rates by delivering a year-on-year improvement in the
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proportion of cancers diagnosed at stage one and stage two; and reducing
the proportion of cancers diagnosed following an emergency admission.
vii)
Achieve and maintain the two new mental health access standards: more
than 50 percent of people experiencing a first episode of psychosis will
commence treatment with a NICE approved care package within two weeks
of referral; 75 percent of people with common mental health conditions
referred to the Improved Access to Psychological Therapies (IAPT)
programme will be treated within six weeks of referral, with 95 percent
treated within 18 weeks. Continue to meet a dementia diagnosis rate of at
least two-thirds of the estimated number of people with dementia.
viii)
Deliver actions set out in local plans to transform care for people with
learning disabilities, including implementing enhanced community provision,
reducing inpatient capacity, and rolling out care and treatment reviews in line
with published policy.
ix)
Develop and implement an affordable plan to make improvements in quality
particularly for organisations in special measures. In addition, providers are
required to participate in the annual publication of avoidable mortality rates
by individual Trusts.
(ii)
North East Combined Authority – Health and Social Care Devolution
Duncan Selbie, Chief Executive of Public Health England, has been named as
Chair of the Commission for Health and Social Care Integration in the North East.
The Commission will address a range of services, including Acute and Primary
Care, Community Services, Mental Health, Social Care and Public Health. It is
expected that the Commission shall report in the Summer of 2016 with
recommendations for ‘further devolution and integration’ and ‘the steps needed to
achieve this’.
(iii)
Quick Guides (NHS England)
The Head of Delivery, NHS England and as part of transforming urgent and
emergency care services has promulgated the following series of quick, online
guides providing practical tips and case studies to support health and care systems
regarding:





Clinical input to Care Homes.
Identifying local Care Home placements.
Improving Hospital discharge into the Care sector.
Sharing patient information.
Technology in Care Homes.
(iv)
Breaking down the barriers – Older people and complaints about health
care (Parliamentary and Health Service Ombudsman)
The report shows that people over the age of 75 often lack the knowledge and
confidence to complain, and worry about the impact complaining might have on
their future care and treatment.
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The report makes two key recommendations to improve the situation:

Organisations that provide health care services need to make everyone who
uses their service aware of how to complain, point them to the support with
making a complaint that is available to them, and make clear that their future
care will not be compromised if they do complain. Organisations should use
‘My expectations’ to measure how effectively they are doing this, and to
understand those areas that need to improve, in order to meet peoples’
expectations of what should happen when they raise a complaint.

Commissioners of health care services should use ‘My expectations’ as a
framework for seeking evidence to determine how well organisations that
provide care welcome, listen to and respond to complaints as part of their
quality monitoring activity. NHS England has developed toolkits for
commissioners of primary care, and acute, community and mental health
care services to support them to do this.
(v)
Sustainability and Financial Performance of Acute Hospital Trusts
(National Audit Office)
Of particular note:
181 out of 239 NHS Trusts and NHS Foundations were reporting deficits in the first
six months of 2015-16.

The redesigned models of healthcare are new and untested, and
making savings through these will be challenging. The NHS new models
of care aim to breakdown the boundaries between primary, hospital and
community care, and integrate services around the needs of the patient.
NHS England has made some assumptions about the savings it expects from
the new models of care and when these will be realised, but achieving
savings through redesigned healthcare is not easy. Acute Trusts have fixed
costs and, in many cases, large-scale changes requiring investment are
needed for them to make savings. This suggests that closing the efficiency
gap is ambitious. Furthermore, the Five Year Forward View makes the case
for sustained social care services and a radical upgrade in public health and
prevention as a way to reduce demand for acute services, but the cut in
public health funding could make it even more challenging for local health
economies to deliver efficiency improvements.

The Department and its arm’s-length bodies agree there will be a £22
billion gap between resources and patient needs by 2020-21 but it is not
clear how the NHS will close this gap. NHS England has estimated that
demand and efficiency gains of 2%–3% a year are needed to make savings
of £22 billion. However, the NHS has achieved a much lower rate of
efficiencies in recent years. Expected financial savings from the Five Year
Forward View will not help the immediate financial position of Trusts, as
estimates suggest these will not be realised until nearer the end of the
five years. The Department told us that its Finance and Efficiency Board is
developing a plan that will be informed by funding decisions made by
Government in November 2015, and will allow the NHS to close the gap
between resources and patient needs, but it is not yet clear how and when
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most of the £22 billion of savings will be made, or the contribution that
individual organisations and sectors are expected to make. We would expect
the Department and its arm’s-length bodies to develop and implement a
coherent plan that shows how the gap between resources and patient needs
will be closed by all parts of the NHS. This plan should be aligned with
resources and requirements for patient care, and should be communicated
so that Trusts can plan for financial sustainability.

We said in our November 2014 report on NHS financial sustainability that the
trend of NHS Trusts’ and NHS Foundation Trusts’ declining financial
performance was not sustainable. At that time, Trusts overall, including
Acute Trusts, were in a better financial position, but since then, Acute Trusts’
financial performance has deteriorated sharply, and their financial position is
forecast to worsen. With financial problems endemic, we repeat our view
that these trends are not sustainable.

The Department, NHS England, Monitor and the NHS TDA have responded
to Trusts’ financial distress with measures to help improve financial
performance, but Trusts’ financial management has been undermined by a
turbulent planning period and the multiple interventions by the Department,
Monitor and the NHS TDA that seek to control Trusts’ spending. Effective
oversight by the Department and its arm’s-length bodies will become harder if
the number of Trusts in financial distress rises further.

Running a deficit seems to be becoming normal practice for Acute Trusts.
And there is a risk that poor financial performance is not taken as seriously
as poor healthcare provision. This weakens the effectiveness of market-style
mechanisms designed to improve hospital productivity and efficiency. The
Government’s commitment to increase funding for the NHS could be a
significant step towards Acute Trusts achieving financial balance, but this
depends on how the funding is used and the impact of wider changes to
healthcare services. The Department, NHS England, Monitor and the
NHS TDA need to take a more holistic, coordinated approach to tackling
Trusts’ persistent financial problems and move beyond quick fixes to cut
Trusts’ spending. Until there is a clear pathway for Trusts to get back to
financial stability, we cannot be confident that value for money, defined as
financial and service sustainability, will be achieved.
Recommendations:

The Department, NHS England, Monitor and the NHS Trust
Development Authority (NHS TDA) should work together to improve the
Trust planning process and their oversight of financial risk. Unexpected
delays in the 2015-16 planning process meant that financial plans were still
being reviewed and restated more than halfway into the financial year. As a
result, these plans were of limited use in monitoring risk to Trusts’ finances.
-
Monitor and the NHS TDA should work together to ensure that NHS
Trusts and NHS Foundation Trusts have financial plans in place at the
start of the financial year.
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-
-
-
Monitor and the NHS TDA should work together to ensure that NHS
Trusts and NHS Foundation Trusts have financial plans in place at the
start of the financial year.
NHS Trusts, NHS Foundation Trusts and commissioners should plan
finances together to take account of the needs of the local health
economy.
NHS England, Monitor and the NHS TDA should strengthen processes
for testing and aligning the assumptions of commissioners and Trusts.
The Department, NHS England, Monitor and the NHS TDA should
improve financial risk management by going beyond one-year planning
time frames.

When designing measures to control costs, the Department should
consider how these measures will be implemented successfully. The
Department has introduced a number of controls on Trusts’ spending, but it is
unclear how much impact they will have within Trusts. The controls need to
be introduced at the right time so they can be co-ordinated with Trusts’
financial planning. Monitor and the NHS TDA should share best practice to
highlight how interventions may be put into practice.

The Department, NHS England, Monitor and the NHS TDA should put in
place a clear plan for improving financial sustainability. It will take time
to achieve savings from changes under the Five Year Forward View.
Interventions to reduce Trusts’ deficits create a constantly changing
environment that could lead to ineffective financial management. The
Department and its arm’s-length bodies should help create a period of
financial stability to enable Trusts and local health economies to make
change while maintaining operational standards.

The Department must move ambitiously and more thoroughly to set out
savings goals to secure financial sustainability. In order to close the
expected funding gap of £22 billion, it needs the NHS to make efficiency
savings to 2020-21. The Department must set out how much it expects
Acute Trusts to contribute towards this goal. It must work with Monitor, the
NHS TDA and NHS England to set out clear plans for Trusts to achieve this.
Monitor and the NHS TDA should look in more detail at the ambition and
achievability of Trusts’ cost improvement plans.

Price and tariff setters (NHS England and Monitor) should move faster
to ensure that payment systems support change and promote financial
sustainability. The different ways in which Acute Hospital Trusts generate
income affects their overall financial performance. Payment systems do not
always support financial sustainability. This led to an increase in the amount
of extra financial support in 2014-15. The Department, NHS England,
Monitor and the NHS TDA should develop and share a clear pathway for
stability which reduces the need for reactive financial support.
(vi)
The Better Care Fund 2016/17 Policy Framework (Department of
Health/Department for Communities and Local Government)
In 2016-17, the Better Care Fund will be increased to a mandated minimum of
£3.9 billion to be deployed locally on health and social care through pooled budget
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arrangements between Local Authorities and Clinical Commissioning Groups. The
local flexibility to pool more than the mandatory amount will remain. From 2017-18,
the Government will make funding available to Local Authorities, worth £1.5 billion
by 2019-20, to be included in the Better Care Fund. In looking ahead to 2016-17, it
is important that Better Care Fund plans are aligned to other programmes of work
including the new models of care as set out in the NHS Five Year Forward View and
delivery of 7-day services.
This document sets out the policy framework for the implementation of the fund in
2016-17, as agreed across the Department of Health, Department for Communities
and Local Government, Local Government Association, Association of Directors of
Adult Social Services, and NHS England. In developing this policy framework, the
strong feedback from local areas of the need to reduce the burden and bureaucracy
in the operation of the Better Care Fund has been taken on board, and steps taken
to streamline and simplify the planning and assurance of the Better Care Fund in
2016-17, including removing the £1 billion payment for performance framework.
In place of the performance fund are two new national conditions, requiring local
areas to fund NHS commissioned out-of-hospital services and to develop a clear,
focused action plan for managing delayed transfers of care (DTOC), including
locally agreed targets. The conditions are designed to tackle the high levels of
DTOC across the health and care system, and to ensure continued investment in
NHS commissioned out-of-hospital services, which may include a wide range of
services including social care.
Further detailed guidance is to be issued by NHS England on developing Better
Care Fund plans for 2016-17. The guidance will form the Better Care Fund section
of the NHS Technical Planning Guidance, which will be available on NHS England’s
website. Local areas are asked to refer to and follow this guidance.
Beyond the 2016-17 Better Care Fund it is to be noted that the Spending Review
sets out an ambitious plan so that by 2020 health and social care are integrated
across the country. Every part of the country must have a plan for this in 2017,
implemented by 2020. Areas will be able to graduate from the existing Better Care
Fund programme management once they can demonstrate that they have moved
beyond its requirements. Further details are awaited in this regard.
Sir Leonard Fenwick
Chief Executive
21st January 2016
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