Everyone Counts2014/15 Planning Guidance

Nicola BaileyChief Operating Officer

Michael HoughtonDirector of Commissioning and Development

Planning Framework

Planning Framework

1 vision:

high quality health care for all, now and for future generations

5 outcome domains 7 outcome measures 3 key measures 6 characteristics of high quality,

sustainable health and care systems

4 essential elements

One vision High quality health care for all now and for future

generations:−driven by quality in all we do−equal access for all, especially the vulnerable

and the excluded−spread existing excellence−sustainable, high quality for the long term

5 Outcome Domains, 7 Measures (ambitions) Preventing premature death

Quality of life for LTCs

Quick recovery from ill health

Great experience of care

Safe care

Securing additional years of life for people with treatable mental and physical conditions

Improving health related quality of life for people with long term conditions

Reducing avoidable time in hospital Increasing elderly people living

independently at home on discharge Increasing positive experience of

hospital care Increasing positive experience of

care outside hospital Significant progress on eliminating

avoidable deaths

3 Key Measures

Promoting health, preventing ill health in partnership

Better care for the most vulnerable fffff

For mental and physical health

1. Improving health ffffffffff

2. Reducing health

inequalities

3. Parity of esteem

6 System Characteristics

The 6 characteristics of high quality, sustainable health and care systems in 5 years time are: Citizen inclusion and empowerment Wider primary care, provided at scale A modern model of integrated care Access to the highest quality urgent and

emergency care A step-change in the productivity of elective

care Specialised services concentrated in

centres of excellence

Unit of Planning – County Durham

Unit of Planning

ND CCG

DDES CCG

DCC

CDDFT

TEWV

DDTAT

Clinical Programme Board

Five year strategic plan

Unplanned care

Planned care

Intermediate care

Frail elderly

7 day services

SeQiHS

Planning Fundamentals Strategic and operational plans must explicitly set

out the approach to:

Improvements in the 5 outcome domains and 7 measures

Delivering the 3 key measures Implementing the 6 system characteristics Delivering the 4 essential elements

Plans should be: Bold and ambitious Developed in partnership with providers and local authorities Locally led

Operational and better care fund plans must be driven by the strategic plan

Strategic, Operational and Financial Planning Strategic plan

System vision Sustainability Key values and principles Integration Improvement interventions Quality improvement Governance overview

Operational plan Outcomes Activity NHS Constitution Better Care Fund

Strategic, Operational and Financial Planning Financial plan

Financial plan summary Financial plan detail 2014/15 – 2018/19 Investment Capital Revenue resource limit QIPP 2014/15 – 2018/19 Statement of financial position Contract value 2014/15 – 2018/19 Planning assumption Risk Cash

Strategic enablers

NHS standard contract

The quality premium

Commissioning for quality and innovation

Non recurrent funds

£200m for Local Authorities (LAs) in 2014/15 (Section 256 of the NHS Act 2006)

£3.8bn pooled budget in 2015/16 (Section 75 of the NHS Act 2006) for health and social care services to work more closely together in local areas, based on a plan agreed between the NHS and LAs

£1bn of £3.8bn ‘payment by performance’ in 2015/16

Signed off by Health and Wellbeing Boards (HWBs)

Links to earlier letters:

• Joint LGA/NHS England narrative (Aug 2013)

• Joint letter & draft template (Oct 2013)

Better Care Fund

Plans must deliver on national conditions:

Protecting social care services; 7-day services to support discharge; Data sharing and the use of the NHS

number; Joint assessments and accountable lead

professional

Delayed transfers of care Emergency admissions Effectiveness of reablement Admissions to residential and nursing care Patient and service-user experience Local metric

Pay for performance based on:

Planning Timetable

Plan Assurance Process

Address the planning fundamentals Build on the existing CCG and DC assurance

frameworks Triangulate between:

commissioner and provider plans outcomes, activity and finance plans and planning assumptions plans, local engagement and relationships Operational, BCF and strategic plans

Joint process including regional team, area teams, Monitor, NHS Trust Development Authority

Durham, Darlington and Teesplanning guidance andallocation of resources 2014-15 and 2015-16

Total NHS England resources 2014-15 and 2015-16

2013/14 2014/15 2015/16

£bn £bn £bn

NHS England recurrent allocation 93.62 96.64 98.84

Growth 3.1% 2.3%

Estimated GDP deflator 2.1% 1.5%

‘Real term' growth 1.0% 0.8%

Other non recurrent allocations;

Surplus drawdown 0.65 0.40 0.40

Surplus carry forward 0.53 0.47 0.07

Winter pressures 0.25 0.25

AME/Technical 0.66 0.66 0.66

2.09 1.78 1.13

Total allocations 95.71 98.42 99.97

Total NHS England resources 2014-15 and 2015-16

2013-14 2014-15 2015-16 Growth Efficiency£bn £bn £bn 2014-15 2015-16 2014-15 2015-16

Growth 3.1% 2.3%Estimated GDP deflator 2.1% 1.5%‘Real terms' growth 1.1% 0.8%

CCG Programme 62.75 64.34 65.69 2.5% 2.1% 3.3% 5.9%Better Care Fund 0.86 1.10 1.10 28.1%CCG Admin costs 1.35 1.35 1.22 0.0% -9.6% 2.1% 11.3%Quality Premium 0.00 0.20 0.20Total CCG 64.96 66.99 68.21 3.1% 1.8%

Specialised 12.96 13.52 14.33 4.3% 6.0% 6.2% 3.1%Primary Care (AT) 11.76 12.02 12.22 2.2% 1.7% 2.5% 2.2%Primary Care (GPIT and other) 0.19 0.28 0.28 47.4% 0.0%Other direct commissioning 0.43 0.44 0.45 2.3% 2.3% 1.6% 1.8%Public Health S7a 1.71 1.80 1.80 5.3% 0.0%NHS England Programme 0.98 0.93 0.96 -5.1% 3.2% 18.5% 2.6%NHS England Admin 0.67 0.54 0.49 -19.4% -9.3% 2.6% 11.3%Other 0.12 0.12 0.12 0.0% 0.0%NHS England 28.82 29.65 30.65 2.9% 3.4%

Total 93.78 96.64 98.86 3.1% 2.3%

NHS England Allocations Two year funding allocations 2014/15 and 2015/16 published, NHS England

uplift agreed at 3.1% for 2014/15 and 2.3% for 2015/16

The Department of Health Mandate requires NHS England to run a transparent allocation process to ensure locality funding is based on the principle of equal access for equal need, having regard to need to reduce inequalities in access to and outcomes from healthcare

Revised fair share formula for CCG and primary care allocations with an agreed pace of change - CCG target allocations published 20 December 2013

CCG sector receive real terms growth plus £250m in 2014/15 and £400m in 2015/16 to support cost pressures and pace of change

Average uplift for CCG programme: 2014/15 = 2.54% and in 2015/16 = 2.1%

Running costs quantum maintained in 2014/15 and reduced by 10% from 2015/16

Fair Share Allocations

Population, age and deprivation are the key factors defining the ‘need’ for health care.

As has previously been reported, in December 2012 NHS England launched a fundamental review of the allocation policy through the Advisory Committee for Resource Allocation (ACRA).

Initial findings were published by NHS England in August 2013, with a proposed new formula which placed a greater emphasis on age. Historically, deprivation factors were addressed through a Disability Free Life Expectancy (DFLE) adjustment representing unmet health need relating to deprivation. This adjustment was removed in the summer exercise due to limited evidence on the cost impact of unmet need (DFLE failed to capture pockets of deprivation in otherwise affluent areas).

Fair Share Allocations (continued)

NHS England has since however revisited the formula and in December 2013 agreed to a further adjustment for inequalities – using the standardised mortality ratio (SMR) < 75 to reflect unmet need. SMR is considered the best available option as it is strongly correlated to deprivation, is available for small areas (7,000 pop) and is updated frequently. Using this measure allows deprived communities within otherwise affluent areas to be recognised.

This results in an additional adjustment to the formula to target additional resource to areas with poorer outcomes, enabling additional investment towards closing the gap. This adjustment is set at 10% for CCG allocations 15% for primary care (assuming that unmet need can be more effectively addressed through primary and community care).

Although North Durham CCG remains above its ‘target’ allocation based on this new allocation formula, a pace of change policy has been applied with all CCGs receiving a minimum uplift in 2014/15 of 2.14% and 1.70% in 2015/16.

CCG Allocations

CCG Allocations Allocation Allocation Growth Allocation Growth Social Care

fund Total

AllocationBetter Care

Fund BCF % of

13-14 14-15 14-15 15-16 15-16 15-16 15-16 15-16 Allocation£’000 £’000 % £’000 % £’000 £’000 £’000 %

NHS Darlington CCG 130,681 133,478 2.14% 135,747 1.70% 2,297 138,044 7,175 5.3%

NHS DDES CCG 397,057 405,554 2.14% 412,448 1.70% 7,147 419,595 21,967 5.3%

NHS North Durham CCG 306,409 312,966 2.14% 318,286 1.70% 5,789 324,075 17,226 5.4%

NHS HAST CCG 357,996 365,657 2.14% 371,874 1.70% 6,171 378,045 19,533 5.3%

NHS South Tees CCG 376,939 385,005 2.14% 391,550 1.70% 6,775 398,325 20,844 5.3%

Durham, Darlington & Tees 1,569,082 1,602,660 2.14% 1,629,905 1.70% 28,179 1,658,084 86,745 5.3%

North 19,379,212 19,808,433 2.21% 20,161,485 1.78% 341,886 20,503,371 1,066,325 5.3%

Midlands & East 18,252,726 18,724,507 2.58% 19,122,112 2.12% 327,638 19,449,750 1,014,727 5.3%

London 9,721,467 10,019,864 3.07% 10,282,651 2.62% 170,364 10,453,015 539,837 5.2%

South 15,390,307 15,783,623 2.56% 16,113,898 2.09% 260,112 16,374,010 839,111 5.2%

Total 62,743,712 64,336,427 2.54% 65,680,146 2.09% 1,100,000 66,780,146 3,460,000 5.3%

Lowest 2.14% 1.70%

Highest 4.92% 4.49%

North Durham CCGProgramme Budgets: 2013/14 2014/15 2015/16

CCG Allocation (£’000) 306,409 312,966 318,286Growth 2.14% 1.70%

Social Care Fund (from NHS England central funds) 5,789

Total Allocation 306,409 312,966 324,075

Total transfer to Better Care Fund 17,226

Running Cost Budgets:

Running Cost Allowance (£’000) 6,070 6,070 5,463Reduction 10% (£607k)

Note – programme budget allocation will change once specialised commissioning and other allocation adjustments confirmed

‘Pace of Change’

Current Position:

Programme Budget

Baseline Allocation

Registered Population

Allocation per head

£’000 £306,409 249,084 1,230

Forecast Position:

Opening Target

allocation per head

Distance from

targetGrowth on prior year

Allocation per head

Estimated registered population

CCG Programme

Budget allocation

Total growth on prior year

Closing target

allocation per head

Distance from target

2014/15 1,192 3.20% 1.51% 1,249 250,627 312,966 2.14% 1,222 2.16%

2015/16 1,212 3.04% 1.08% 1,262 252,174 318,286 1.70% 1,237 2.02%

Pace of change agreed by NHS England – all CCGs to receive minimum 2.14% uplift in 2014/15 and 1.7% in 2015/16

CCGs have target allocations per head and expectation is for ‘distance from target’ to reduce over time:

Better Care Fund (BCF)

Previously known as integration transformation fund (ITF)

Total £3.8bn pooled budget in 2015/16, includes reablement and carers’ breaks funding from CCGs along with approx. 3% from CCG baseline resources

Requires joint plans to be developed and agreed by Health and Wellbeing Boards

Better Care Fund 2015/16Social Care

fund Carers and Reablement

CCG Baseline resources

Total Better Care Fund

£'000 £'000 £'000 £'000

DDES CCG 7,147 2,700 12,120 21,967North Durham CCG 5,789 2,084 9,353 17,226Total County Durham BCF 12,936 4,784 21,473 39,193

Capital (including share of £220m for Disabled Facilities Grant) 4,542

Total resources 43,735

Running Costs

2014/15 - no additional funding for inflation i.e. quantum remains the same but growing population means £/head will reduce

2015/16 - 10% reduction

2013/14 = £25 per head 2014/15 = £24.78 per head (population growth) 2015/16 = £22.11 per head Thereafter same methodology applied.

£400m pensions pressure anticipated in 2015/16 plus changes to NI rates

Concern over consistency with legal framework and ability to deliver transformational strategy

From 2014/15 no external funding for transition costs i.e. all restructuring costs must be funded from within running costs.

Planning Assumptions / ‘Business Rules’

CCG Planning Assumptions

Business rules

2014/15 2015/16

• Minimum 0.5% contingency

• 1% surplus

• 2.5% non-recurrent spend (including 1% for transformation)

• Minimum 0.5% contingency

• 1% surplus

• 1% non-recurrent spend

Tariff Assumptions Uplift Efficiency Net efficiency

Non-acute services (community and MH) 2.2% -4.0% -1.8%

Acute services (non-tariff) 2.5% -4.0% -1.5%

Acute services (national tariff) 2.8% -4.0% -1.2%