Exoskeleton - STPs and the Single Oversight Framework

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With the imminent announcement about progress and next steps for the STPs, this article looks at how NHS Improvement’s regulatory framework for providers can be used to help local leaders to “do the right thing”.

At the NHS Providers annual conference last year, the question was asked whether Sustainability and Transformation Plans (STPs) would be given a statutory framework. “Not in this session,” replied Jeremy Hunt. Some of the audience thought that meant there would be legislation in the next session of Parliament. We think not. There is already a mechanism for making STP’s plans part of the governance structure of NHS trusts and foundation trusts, and ensuring compliance, and its name is the Single Oversight Framework (SOF).

Under the SOF, a foundation trust’s or NHS trust’s cooperation (in making the STP a success) is a measure of the trust’s success or failure. Foundation trusts and NHS trusts that fail this test are at risk of finding themselves in Segment 3 or 4 - classifications that carry the promise of “mandated support” to help them to find the path back to compliance. This is possible, because FTs are subject to a licence condition that does not apply to other providers, the FT governance condition (FT4), as well as other conditions on continuity of service and integration that apply to all providers. This is the same group of conditions under which Monitor issued its Risk Assessment Framework, which the Single Oversight Framework replaced on 1 October 2016.

NHS Improvement’s argument for this approach is that good governance includes playing an active part in promoting the success of the health system. NHS trusts do not have a Monitor licence, but the Single Oversight Framework still applies to them. NHS Improvement in its NHS Trust Development Authority role is committed to applying the Single Oversight Framework and the NHS Provider Licence to NHS trusts too, on an “as if” basis.

In case you doubt this interpretation or how far it might be taken, note that a suggested measure of success under the Single Oversight Framework is “the extent to which providers are addressing unsustainable services through consolidation, and change or transfer to a neighbouring provider”. The NHS Operational Planning and Contracting Guidance 2017-19, which is a joint NHS England and NHS Improvement publication, also clarifies that, wherever appropriate, the main point of contact for discussing progress with implementation of STPs – which must include whether a trust is participating fully in the success of its local STP - will be the local STP leadership.

What all of this means is that in order to be confident that they are promoting the success of their trust, Boards will have to take into account that their organisation is also judged by how nicely it plays with others in the local health economy. If a trust chooses to de-prioritise the STP’s goals, the Single Oversight Framework entitles NHS Improvement to regard the trust as failing. In an extreme case, the trust could be told to subordinate its (other) organisational goals to the system’s goals as set out in the STP. However, in many cases such a direct approach may not be necessary. If one accepts that STPs are a rational response to a crisis, bearing in mind they are signed off by NHS Improvement and NHS England, why would a trust stand in the way? It may be that the trust has other problems that will be exacerbated by the local plan being implemented. In those circumstances, the trust’s existing problems may already justify mandated support, which could provide a context to bring the trust’s plans into line with the STP.

As long as trusts respond to the “nudge”, it may not be necessary for NHS Improvement to do anything more. The trusts, their resolve stiffened by the Single Oversight Framework, will do “the right thing”. To put it another way, STPs do not need a legal structure of their own, because through the SOF, backed up by the NHS Provider Licence (in the case of foundation trusts) and the TDA’s power to direct (in the case of NHS trusts), NHS Improvement is able to encourage and, where encouragement fails, enforce compliance with the STP from the outside-in. The $24,000 question, which may rarely arise in practice, is whether NHS Improvement will be prepared to intervene even where a trust is a success on all other measures.
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