Transcript BUDGETS DEEP DIVE

2011/12 Operating Framework
Vanessa Harris
21st December 2010
Overview of structure for NHS OF 2011/12
The Operating Framework sets out the priorities for the NHS in 2011/12, the first full year of the
transition, and the changes to national levers to enable the system to deliver
Focus is on:
Transition
& Reform
What needs to happen in 2011/12 to realise the White Paper’s
aspirations in terms of new organisations and roles
Transparency &
Where we can get better at local accountability and how we
local accountability support a revolution in patient power
Service
quality
How we maintain delivery and meet QIPP challenge
Supported by:
Financial &
business rules
System levers and enablers
System
accountability
Planning and assurance
Transition and Reform
Local Level:
• Will undertake a managed consolidation of PCT capacity, Clusters.
Will have a single Executive Team and be in place by June 2011.
• Includes requirement for £2 per head development fund – funded
from management cost savings
Stronger Contracting:
• All contracts must be signed by start of financial year.
• PCTs to ensure that contracts allow for Providers to manage
demand in their own organisations.
• PCT to use contract sanctions if not satisfied with data. SUS will be
standard repository by April 2012 and progress towards deadline
performance managed in 2011/12
Service Quality
QIPP:
• Commitment to £20bn efficiency challenge, despite
changed assumptions of CSR and pay freeze
• QIPP to be embedded in a single operational plan for
each SHA and PCT
Key New Commitments:
• New coalition commitments e.g. more Health Visitors
and Family Nurse Partnership expansion
Finance and Business Rules
Surplus Strategy:
• Expected drawdown of SHA / PCT surplus will be £150m (c.15%)
• No PCT to plan operating deficit in 2011/12. Trust deficits planned
only where part of a planned recovery, in agreement with DH and
SHA
• Requirement for 2% of PCT recurrent resource to be spent non
recurrently for each PCT
• 2% will be held by SHA and accessed only through agreement of
business case
• GP consortia will not be responsible for resolving legacy debt that
arose prior to 2011/12. PCTs must ensure that debt issues are
resolved by the end of 2012/13
• GP consortia to work closely with PCTs to prevent PCT deficits over
the next two years
Finance and Business Rules
PCT Allocations:
• Average growth in recurrent allocations is 2.2%.
• Including non recurrent allocations for social care, PDS,
GOS and pharmacy average increases of 3%.
Running Costs
• 2010/11 last year for reporting PCT, SHA and Provider
management costs. For SHA and PCTs will be replaced
by “running costs” from 2011/12. By 2014/15 running
costs to reduce by one third from current (2010/11).
Details to be provided as part of Planning Guidance.
• GP consortia could have a running cost allowance of £25
- £35 per head by 2014/15
Finance and Business Rules
Capital:
• Trusts: Primary source of funding will continue to be internally
generated cash and interest bearing loans
• Capital allocation unspent from 10/11 not carried forward
• No expectation that a central capital budget programme will exist in
11/12. All capital requirements will be handled as part of planning
process
• Regime for new community Trusts will follow NHS Trusts
• Spending review means smaller financial envelope for capital.
Trusts are expected to prioritise backlog maintenance and patient
safety, privacy and dignity
• PCTs: There will be no automatic capital allocation for PCTs with
funding being granted on a cases by case basis
Finance and Business Rules
Tariff:
• Increase in use of Best Practice Tariffs.
• Reduction in payments for short stay patients attracting a long
stay tariff
• All tariffs set 1% below average cost (Originally this was targeted
to certain tariffs only).
• Result of these changes is that published tariff will reduce by 2%.
Inflation of 0.5% added to this – net effect 1.5% reduction.
• Non tariff services also subject to 1.5% reduction
• 4% provider efficiency to offset 2.5% pay and prices inflation
Finance and Business Rules
Tariff:
• Adult Renal Dialysis comes into scope of PbR.
• Changes to A&E, Specialist Tops Ups, Critical Care currencies
• Service users in Mental Health allocated to tariff clusters
• 30% marginal rate continues for emergency activity over the
08/09 baseline
• No payment for Emergency readmissions following Elective
admissions, local agreement about other readmissions within 30
days
• Option to provide services at lower than national tariff
• Actual impact of 11/12 tariff on PCTs is most closely aligned
with most favourable WCC scenario from 10/11
Further Information
Includes
• 2011/12 National Tariff and Guidance (incl. 30 day
readmissions) – Dec 2010.
• PCT Allocation Working Papers – Mid January 2011
• Detailed Planning Guidance (incl. 2% non-recurrent,
running costs definitions) – End January 2011
• Information Strategy – Early 2011
• Detail on Operation of the Cancer Drugs Fund – Advice
published following consultation
Finance and Business Rules
PCT Allocations and Distance from Target
Organisation - PCT
DFT 11/12
DFT 10/11
Growth in
NHS
recurrent
Allocations
%
%
%
Growth in
Local Authority
Allocations
%
Brighton & Hove
6.10
7.70
2.00
(4.66)
East Sussex Downs & Weald
1.40
2.40
2.00
(1.54)
Eastern & Coastal Kent
0.20
(0.80)
2.20
(1.82)
Hastings & Rother
1.10
2.10
2.00
(1.54)
(1.50)
0.20
2.20
(3.57)
5.00
11.60
2.00
(0.31)
(2.10)
0.00
2.20
(1.82)
0.40
3.70
2.10
(0.65)
Medway
Surrey
West Kent
West Sussex
Planning Timetable – PCTs and NHS
Trusts
•
•
•
•
•
January 19th – Submission of Initial Plans by Trusts and PCTs to
SHA
High Level DH templates covering I&E, Capital and Resource and
Applications (PCTs)
Income, Activity and Operating Costs bridge from 10/11
High Level workforce numbers
QIPP – SHA planning to use 30th November / 31st December QIPP
returns from orgs
SHA Templates by December 31st
March 11th – Submission of final FIMS plans by Trusts and
PCTs to SHA