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© Original material is copyright Cordis Bright Ltd, 2017. You are welcome to reuse material but please recognise source.
Cordis Briefing
April 2017
Follow live @cordisbright or #briefing
These are extracts from April 2017’s Cordis Briefing. Full versions of the slides are available for subscribers by
emailing lucyasquith@cordisbright.co.uk. Please contact Lucy if you would like to receive further information about
subscribing.
© Original material is copyright Cordis Bright Ltd, 2017. You are welcome to reuse material but please recognise source.
Agenda
• Introduction / Opinion Polling
• Cordis Viewfinder 2017
• Funding for Social Care
• Profiling the Not-for-Profit Sector
• LHA Cap and Supported Housing
• Cordis Viewfinder 2017
• The NHS and Integration
Extract
Cordis Viewfinder 2017 &
funding for social care
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Extract
Collective wisdom?
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
Strongly disagree Disagree Agree Strongly agree
2013 2014 2015 2016 2017
The squeeze on social care funding will
soon lead to a crisis which forces the
government to make more funds available
21% 79%
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Extract
Budget
“Today, our social care system cares for over a million people and I pay
tribute to the hundreds of thousands of carers, who work in it.
“But the system is clearly under pressure. And this in turn puts pressure
on our NHS. Today, there are half a million more people aged over 75
than there were in 2010. And there will be 2 million more in ten years’
time.
“That is why the government has already delivered more than £7 billion
extra spending power to the system over the next three years….
“Today I am committing additional grant funding of £2 billion to social
care in England over the next 3 years, with £1 billion available in 17-18.
This will allow local authorities to act now to commission new care
packages.”
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Extract
Budget
• £2billion over three years
– £1,010,000,000 in 2017/18
– £674,000,000 in 2018/19
– £337,000,000 in 2019/20
• On average it is around £13million per authority
• However actual distribution is more complex and intended to support
authorities in reducing delayed transfers of care.
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Extract
Budget
• Largest additional funding:
– Kent £52.2million over three years
• Smallest additional funding (excluding Isles of Scilly at £97,000):
– Wokingham £338,172 over three years
• Around a third of the money is going to 20 of the 152 authorities
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Extract
Budget
-
10,000,000
20,000,000
30,000,000
40,000,000
50,000,000
60,000,000
Ken
t
Esse
x
Ha
mp
shir
e
De
rbyshir
e
He
rtfo
rdshir
e
No
ttin
gha
mshire
Le
ed
s
Liv
erp
oo
l
Du
rha
m
She
ffie
ld
No
rth
am
pto
nsh
ire
Cu
mb
ria
Glo
uce
ste
rsh
ire
Bra
dfo
rd
Le
ice
ste
rshir
e
Ca
mb
ridg
eshire
Bristo
l
Kirkle
es
Oxfo
rdsh
ire
Wa
kefie
ld
Sou
thw
ark
Wig
an
No
ttin
gha
m
Wilt
sh
ire
Ne
wcastle u
po
n T
yn
e
Ne
wha
m
Kin
gsto
n u
po
n H
ull
No
rth
um
be
rlan
d
Wa
lsall
We
stm
inste
r
Ealin
g
East R
idin
g o
f Y
ork
shire
Sto
ke-o
n-T
ren
t
Ch
esh
ire
West
& C
heste
r
Shro
pshir
e
Salford
Barn
et
Ca
md
en
Enfield
Ch
esh
ire
East
Brig
hto
n &
Hove
De
rby
Ha
ring
ey
Old
ha
m
Re
db
ridg
e
Wa
ltha
m F
ore
st
Kno
wsle
y
St H
ele
ns
Hill
ing
do
n
Sou
th T
ynesid
e
Bla
ckpo
ol
Tra
fford
Ca
lderd
ale
Ha
rro
w
Bexle
y
Ken
sin
gto
n a
nd
Che
lsea
He
refo
rdsh
ire
Sto
ckto
n-o
n-T
ees
Solih
ull
Pete
rboro
ugh
Lu
ton
Wa
rrin
gto
n
Mid
dle
sb
rou
gh
No
rth
Lin
coln
shir
e
Re
dca
r a
nd
Cle
vela
nd
York
Bath
& N
ort
h E
ast S
om
ers
et
Thu
rro
ck
Poo
le
Bed
ford
Slo
ugh
Re
ad
ing
Kin
gsto
n u
po
n T
ha
me
s
We
st B
erk
sh
ire
Ru
tlan
d
Wo
kin
gham
Cornwall –
NOC/Liberal
Democrats
largest party Sutton
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Extract
Budget
Local authority Total for 3 years % of total Political control
Kent 52,281,716 2.59% Conservative
Birmingham 51,056,185 2.53% Labour
Essex 49,862,220 2.47% Conservative
Lancashire 48,421,308 2.40% NOC/Labour
Hampshire 37,145,068 1.84% Conservative
Norfolk 36,366,269 1.80% NOC/Conservative
Derbyshire 31,739,609 1.57% Labour
Staffordshire 30,642,074 1.52% Conservative
Hertfordshire 30,546,869 1.51% Conservative
Devon 30,344,465 1.50% Conservative
Nottinghamshire 30,262,363 1.50% NOC/Labour
Lincolnshire 29,635,462 1.47% NOC/Conservative
Leeds 28,810,134 1.43% Labour
Suffolk 28,052,673 1.39% NOC/Conservative
Liverpool 27,063,384 1.34% Labour
West Sussex 25,338,528 1.25% Conservative
Durham 25,173,203 1.25% Labour
Manchester 24,336,236 1.20% Labour
Sheffield 24,078,295 1.19% Labour
Cornwall 23,951,338 1.19% NOC/Liberal Democrats
Population of these
authorities is around
17.7million people – 34%
of the England population
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Budget
• £2billion in context
– ADASS identified an annual £2.6billion shortfall
– Payment of sleep in cover at NLW rates will cost around £100million (10% of
the first years payment)
– NLW will add around £2.3billion per year by 2020 to social care wage bill
– Cost of NLW for social care funded by local authorities estimated at
£360million
– At best around 46% of the money will be needed to pay for existing provision
which means that just over 50% is available to pay for ‘additional provision’.
– Government now argue that have increased funding on social care by over
£9billion over four years.(this includes the council tax precept)
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Extract
Budget
• Better Care Fund starts to impact from 2017/18
1,010,000,000 674,000,000
337,000,000
105,000,000 825,000,000 1,500,000,000
820,900,000
1,289,800,000
1,804,000,000
-
500,000,000
1,000,000,000
1,500,000,000
2,000,000,000
2,500,000,000
3,000,000,000
3,500,000,000
4,000,000,000
2017/18 2018/19 2019/20
Additional budget funding Better Care Fund Council tax precept estimate
£1.9
billion
£2.7
billion
£3.6
billion
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Extract
Budget
• Extra money has probably brought some time but…………
• Cost pressures in the system remain unfunded (NLW, growing
population of older people and people with complex disabilities)
• Uncertainty remains in terms of how much money is actually raised
through the precept, actual levels of demand (winter pressures) the
actual level of the Better Care Fund as it assumes savings else where
in the system.
• Extra money needs to do two things:
– Pay for rising costs of existing services
– Deliver additionality so more services are provided to more people
• Unclear how much of the latter will be delivered
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Extract
Budget
• Ultimately this is a £2billion stop gap arrangement
• Chancellor also announced the intention to bring forward a Green
paper on long term funding
• This commitment or something more is likely to feature in the
Conservative manifesto
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Extract
Funding negotiations
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Extract
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
2013 2014 2015 2016 2017
Reduction of more than 20% Reduction of between 10% and 20%
Reduction of between 5% and 10% Reduction of between 0% and 5%
Freezing fee rates (i.e. 0% uplift) Increasing fee rates in line with inflation
Increasing fee rates above inflation
Freezing fee rates
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Extract
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
2013 2014 2015 2016 2017
Reduction of more than 20% Reduction of between 10% and 20%
Reduction of between 5% and 10% Reduction of between 0% and 5%
Freezing fee rates (i.e. 0% uplift) Increasing fee rates in line with inflation
Increasing fee rates above inflation
Reduction of more than 20%
Reduction between 10% and 20%
Reduction between 5% and 10%Reduction between 0% and 5%
Freezing fee rates
Increasing fee rates inline with inflation
Increasing fee rates above inflation
The five year trend is fewer requests
for funding reductions.
However:
just under 20% still reported
requests for reductions of over 20%
30% reported requests for
reductions of between 10% and 20%
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Extract
Funding negotiations
• Overall these appear more positive
• However this is still a sector which at best would be described as
‘distressed’
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Extract
Profiling the not-for-profit sector
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Extract
Research approach
• Longitudinal analysis, starting in 2012
• Exploring profitability and growth
• Based on year end results submitted to charity commission
• Looked at 122 charities delivering adult social care
• Categorised them (as far as possible) by main client group
• A combined turnover of more than £3bn in 2016, including:
– 24 charities with a turnover of more than £35m
– 44 charities with a turnover of £10-35m
– 21 charities with a turnover of £5-10m
– 33 charities with a turnover of £1-5m
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Extract
All providers (122)
Profitability
• Looked at trends over four years
• Classified organisations as either:
– Struggling financially: deficits, or very low surpluses (in the region of 1%)
– Doing OK: surpluses of between 2% and 5%
– Outperforming: surpluses of more than 5%
Divergence:
Steady increase in the charities that
are struggling.
Steady decline in the charities that are
doing ok and outperforming.
Reasonable to assume this gap will
get wider in the coming years…
42%
53%49%
61%67%
33% 28%25%
20% 19%
25%19%
26%19%
14%0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
2012 2013 2014 2015 2016
Struggling
OK
Outperforming
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Extract
All providers (122)
Growth
• Categories used:
– Stagnation/shrinking: below inflation-growth or shrinking
– Doing OK: slow continuous growth of around 3% - 5%
– Growing rapidly: steady growth of more than 5% per year
Relatively steady state:
Around half the cohort are stagnating or
shrinking.
Around a third are growing rapidly.
Reasonably steady since 2012 – perhaps a
modest improvement?
58%
51%
43%
53%48%
12%12%
19%15%
21%
30%
36%
38%
32% 31%
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
2012 2013 2014 2015 2016
Stagnating / shrinking
OK
Growing rapidly
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Extract
All providers (122)
Snapshot in 2016
OutperformingOKStruggling
Sta
gn
ating /
sh
rin
kin
gO
KG
row
ing
rapid
ly
17% 7% 7%
16% 5% 2%
34% 7% 6%
15
%57
%
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Extract
Overall
• Lots of similarities across client groups.
• All struggling with profitability now, including autism providers who
used to do ok on this back in 2012.
• But one or two interesting messages about growth:
• LD and Smaller providers, growth is difficult, in line with main cohort.
• MH / SM / Homelessness: may be turning things around a little. This
year’s performance is in line with the main cohort, whereas in previous
years they had trailed behind.
• OP services are continuing to grow faster than main cohort.
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Extract
Overall
• We are seeing more distressed providers: marked increase in low
profit, low growth between 2012-2016.
• If historic trends are repeated, this pattern will continue.
• Very few providers are posting significant profits: it seems that growth
is an easier path to sustainability.
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Extract
The NHS and integration
Back to the future?
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Extract
Going further
• As part of Better Care Fund planning, areas must set out
plans for further integration by 2020.
• DH is encouraging areas to align their approach with
Sustainability and Transformation Plan geographies,
where appropriate.
• The focus may also be on commissioning integration or
through Accountable Care Systems or Organisations that
bring together provision.
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Extract
Vanguards and integration
• Local areas are encouraged to use MCP and PAC
frameworks as guides to support local plans for
integration.
• “Scaling up of PACS and MCPs in a small number of STP
areas will create Accountable Care Organisations, with
further details in the Next Steps on the NHS Five Year
Forward View.”
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Extract
Money
• In 2017-18, the BCF will be increased to a mandated
minimum of £5.128 billion and £5.617 billion in 2018-19.
• The local flexibility to pool more than the mandatory
amount will remain.
• The main change to the Framework from last year is
inclusion of the new social care grant funding.
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Extract
Five Year Forward View update – key
points
Topic Key messages
Emergency care STPs and vanguards to be held to account for
stemming the growth in A&E admissions and bed
days. Vanguards to be docked funding if they fail.
Elective care NHSE acknowledges 18 week waiting target is
unachievable over the next 2 years
Primary care GP practices to be divided into regional hubs with an
average population size of 50,000
Mental health 150 new inpatient beds for children and young people
by 2019
Workforce Reforms to attract more nurses, including flexible
working
Technology Change in how trusts procure IT systems – exemplars
to be used as a blueprint
Accountable care Encouragement for ‘accountable care systems’
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Extract
New care models
• MCP (14) and PACs (9) vanguard areas have lower growth in per
capita emergency hospital admissions than other areas of England:
– England 3.2%
– MCPs 1.9%
– PACs 1.1%
• Care home vanguards are making savings by reducing prescribing
costs, as well showing lower growth in emergency admissions
• NHSE is encouraging other areas to adopt vanguard models, and
MCPs and PACs to become accountable care systems
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Extract
The future of STPs: population based
integrated health systems?
“Our aim is over the next several years to make the biggest
national move to integrated care of any major western
country”Five Year Forward View Next Steps
• Sustainability and Transformation Partnerships to cover every area of
England, coupled with integrated (‘accountable’) care systems
wherever possible
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Extract
Principles
• STPs aren’t new statutory bodies
• The way STPs work will vary according to local need
• However, ‘to succeed, all STPs need a basic governance and
implementation ‘support chassis’’
• From April all NHS organisations will form part of an STP, which will:
– Have a board
– Appoint a chair/leader
– Have programme management support (if CCGs want to align their
management teams with STPs, NHSE will support that)
– Be able to propose an adjustment to their boundaries
– Be judged by results (metrics to be published)
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Extract
Towards accountable care?
• Accountable care systems will be ‘evolved’ versions of STPs that are
working as locally integrated health systems.
• What does this mean?
A system in which a group of providers (or a single
provider) are held accountable for achieving a set of
outcomes for a defined population over a period of
time and for an agreed cost, under a contractual
arrangement with a commissioner.
Accountable Care: Focussing Accountability on the Outcomes That Matter,
WISH (2013)
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Extract
Types of accountable care system
Accountable care
organisation
• Groups of health (and social care) providers working
together to provide care for a defined population
• Shift away from payment per intervention
• Outcomes based – can consider non-clinical
interventions
• Information sharing
• Savings made through achieving better outcomes
• Savings can be shared with payer
Alliance
contracting
model
• One contract between commissioner and alliance of
organisations
• Agreement between parties to work co-operatively
• Payment mechanisms can be structured to spread risk
between providers
• Risk of competition between partners
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Extract
Types of accountable care system
Lead provider
model
• Outcome based contract let to a single accountable
lead provider for the whole programme of care
• Lead provider sub-contracts to others, manages and
decides on financial incentives and contract
mechanisms
• Lead provider incentivises different aspects of care to
work together as a whole
• Could be difficult to decide who should lead
Contracting
outcomes based
incentivised
contracts
(COBIC)
• Performance based contracting
• Emphasis on allowing time to define outcomes and test
through stakeholder involvement
• Can be difficult to specify outcomes
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Extract
CCGsAverage pop’n size 226,00
(211)
Social
care
Public
health
Community
health
Mental
health
Primary
care
Hospital
services
Local Authorities
(152)
Public Health
England
Reg-
ulators
CQC
NHSI
Specialised
services
Primary
care
BCF
STPs (44)Average footprint pop’n 2m
New Care Models (‘Vanguards’)
Dept of Health
NHS England
(+ 4 regional teams)
209
2017
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Extract
CCGsAverage pop’n size 226,00
(209)
Social
care
Public
health
Community
health
Mental
health
Primary
care
Hospital
services
Local Authorities
(152)
Public Health
England
Reg-
ulators
CQC
NHSI
Specialised
services
Primary
care
BCF
STPs (44)Average footprint pop’n 2m
New Care Models (‘Vanguards’)
Dept of Health
NHS England
(+ 4 regional teams)
STPs (44)Average footprint pop’n 2m
Accountable Care Organisations
2024?
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Extract
Social
care
Public
health
Community
health
Mental
health
Primary
care
Hospital
services
Local Authorities
(152)
Public Health
England
Reg-
ulators
CQC
NHSI
Specialised
services
Primary
care
Dept of Health
NHS England
(+ 4 regional teams)
STPs Average footprint pop’n 2m
Accountable Care Organisations
2024?
Regional Health
Authorities
Area Health
Authorities
Hospital, specialist and community
health services
Family
Practitioner
Services
1974
Boards of
Governors of
Teaching
Hospitals
Dept of Health and
Social Services
Public
Health
Residential
care
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Extract
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