Exoskeleton II - STPs and the commissioner landscape

Following last week’s article on how Sustainability and Transformation Plans have become part of the regulatory framework for providers, this article by Mills & Reeve partner Tim Winn describes the other parts of exoskeleton and explains how they can be used to help NHS commissioners and providers to “do the right thing” in supporting their local STPs.

Last week we looked at how the Single Oversight Framework provides NHS trusts and foundation trusts with an enforceable imperative to play their part in the success of their local Sustainability and Transformation Plans (STPs).

In this article, we look at the other structural components of the exoskeleton: the rules that encourage clinical commissioning groups (CCGs) to play their part in the success of their local STP and the rights they (and NHS England) have to redesign local services.

For CCGs, the non-financial imperative to fall into line with the STP is provided by the CCG Improvement and Assessment Framework (CCG IAF), which was introduced by NHS England this time last year. It operates in a similar way to the Single Oversight Framework, by linking STPs to the assessment of what good looks like. The technical appendix to the CCG IAF contains two “indicators” in the “Well Led” domain that are particularly relevant. Indicator 165a (Quality of CCG leadership) adopts the same test that applies to providers under NHS Improvement’s Single Oversight Framework - whether they are playing their part in making the STP a success. Indicator 161a (Sustainability and Transformation Plan) cranks this up another level by making the CCG responsible for the success of the STP (“Each CCG will be assessed on progress for the whole STP, not their individual contribution to the plan, reflecting the necessity of partnership working for the success of the STPs and local transformation.”). If a CCG is classed as failing, NHS England may use its statutory powers to intervene.

The final piece of the exoskeleton is a natural consequence of the structure of the NHS. Providers provide what commissioners commission. It is not quite that simple, because rules about patient choice mean that it is possible for providers to provide services that their local commissioners do not want to commission, if they can persuade another CCG to commission the same kind of services from them. However, in the main, this is noise around the edges. Having capacity and willingness is not enough unless you have a contract with another CCG and, mostly, the commissioner is king.

In September 2016, NHS England and NHS Improvement jointly published the NHS Operational Planning and Contracting Guidance 2017-19 (OPCG). The OPCG introduced the 2017-19 planning round which it said would provide a context for embedding the STP goals in contracts between CCGs and providers for the next two years. As the document says, “The 2017-19 operational planning and contracting round will be built out from STPs. Two-year contracts will reflect two-year activity, workforce and performance assumptions that are agreed and affordable within each local STP.”

The OPCG also explains what will happen to CCGs and providers who refuse to participate. “NHS Improvement and NHS England will intervene where necessary, using their oversight and regulatory powers to resolve any cases where organisations refuse to do so. In addition, where a provider refuses to follow the NHS arbitration process, they may forfeit a proportion of their Sustainability and Transformation Fund (STF) monies, and where a CCG fails to comply with the process, quality premium and transformation monies may be forfeited.”

It seems safe to assume that NHS England’s own direct commissioning will also align with the STP goals it has effectively agreed with NHS Improvement. This means that in most cases commissioners and regulators will have the ability to force through service changes, subject to complying with their obligations to involve the public in their decision-making and to ensuring that any costs to competition are outweighed by benefits to patients and the public (“relevant customer benefits” in CMA terms).

In summary, the structural components of our exoskeleton are the Single Oversight Framework (for NHS trusts and foundation trusts), the CCG Improvement and Assessment Framework (for CCGs) and the NHS Operational Planning and Contracting Guidance 2017-19 (for commissioners and providers). This combination of external regulatory oversight, commissioning intentions and contractual obligations provides reinforcement of STP goals.

However, the effect of the exoskeleton is potentially more far-reaching - making participation in the STP part of the internal governance of the organisation. This is because the SOF and CCG IAF are predicated on the argument that a successful organisation is one that stands behind its STP. Foundation trust directors have an express statutory duty to promote the success of their organisation. We think CCG Governing Bodies and NHS Trust Boards will owe similar duties to their organisations, although their duties to their organisations are not spelled out in legislation. Whilst this does not mean that commissioners and providers can ignore their other obligations, we expect that the system will continue to offer incentives and encouragement for them to fall into line with the STPs, and perhaps penalties and mandated support should they fail to do so, which may help with difficult decisions.

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Every piece of content we create is correct on the date it’s published but please don’t rely on it as legal advice. If you’d like to speak to us about your own legal requirements, please contact one of our expert lawyers.

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