Late last year, Sustainability and Transformation Plans (STPs) were adopted in each of 44 areas covering England. Nationally, the plans seek to cut annual NHS spending by £22bn, by 2020/21. This aim was set out in 2014 by NHS England Chief Executive Simon Stevens in the Five Year Forward View, never properly debated. Stevens is a former health manager, Labour Councillor, advisor to Tony Blair and executive vice president of UnitedHealth Group, one of the biggest US private healthcare corporations.

£22bn is the gap between the predicted increase of £30bn required to maintain NHS services, and the Govt offer of £8bn, proclaimed as £10bn, actually £4.5bn, but under £1bn when adjusted for inflation in healthcare costs.

The cuts strategy began in response to the bank failures of 2008. Gordon Brown commissioned management analysts McKinsey, who recommended:

“The NHS in England could potentially capture efficiencies in health and healthcare services by between 15 and 22% of current spend, or £13 – 20bn, over the next 3-5 years. This reduction could come from

  • technical efficiency savings of £6.0 – 9.2bn found from provider costs
  • allocative efficiency savings of £4.7 – 6.6bn due to no longer commissioning low value added healthcare interventions and ensuring compliance with commissioners’ standards
  • savings of £2.7 – 4.1bn from a shift in the management of care away from hospitals towards more cost effective out-of-hospital alternatives”

In June 2009 NHS Chief Exec David Nicholson (supported by Health Sec Andy Burnham) challenged the NHS to find £20 billion in “efficiency savings” by 2015. That was how we, patients and staff, were to pay for their banking crisis. The Tories continued annual savings targets, now dubbed “Business As Usual”. Any fat in the system is long gone and efficiencies simply mean cuts.

Is the NHS unaffordable?

In 2007 the UK spent 8.4% of GDP on healthcare, in line with the average of comparable developed European economies like France, Germany, or Sweden. Now the UK is on course to reduce this to 6.9% by 2022/23, requiring massive cuts in services. However, even if health spending rose to 8.8% of GDP the NHS would still be affordable by 2030, the Nuffield Trust concluded.

The so-called NHS affordability crisis, is manufactured to support a unilateral Government decision to cut NHS funding.

Cheshire & Merseyside

Cheshire & Merseyside STP stretches from Macclesfield to the Wirral, and from Merseyside to Southport. It covers 2.5m people, 12 CCGs, 20 NHS providers, and 2 proposed Devolution regions. The plan aims to reduce annual regional spending from £6.8bn to £5.8bn. The STP was drawn up in secret, alienating local authorities who were supposed to be partners in a shift towards integrated care in the community, let alone the public or NHS staff. Management consultants PwC (formerly PriceWaterhouseCoopers) were paid £300,000 for work on the plan. As instructed by NHS England, the CCGs refused to release the STP until mid November, and never fully published the appendices.

Nationally, some Councils and Health and Wellbeing Boards backed away or even denounced the plans. On 1 Dec a 150 strong demo and sing-in at the Cunard Buildings attended the Liverpool Health & Wellbeing Board. Keep Our NHS Public, Defend Our NHS, Liverpool Against the Cuts, Merseyside Pensioners Association, GMB, Unison, Unite and Liverpool TUC, heard the Mayor declare “the proposals within the STP are rejected by the Council and this Board, because it fails to address the key issues facing our residents and their health in the years to come.” However, NHS England had already told CCGs to sign contracts for 2017/18 and 2018/19 by 23 December. Despite the chorus of rejection, the contracts were signed.

The STPs go far beyond cuts, to reconfiguration, privatisation, and aligning NHS structures with the formats preferred by US transnationals like UnitedHealth.

Reconfigurations

Last summer, the Countess of Chester Chief Exec briefed senior medical staff. A leaked email revealed that “the CEO suggested that at some point in future Arrowe Park, Clatterbridge and the Countess of Chester would be replaced by a single hospital somewhere near Ellesmere Port.” When MPs attacked the plan, it was denied but not ruled out, and it surfaces in the Wirral University Trust Hospitals Annual Report for 2015/16 as a long term aim.

The first STP target is A&E. In a survey of 99 CCGs, 31% said their STPs were likely to lead to closing or downgrading A&Es in the next 12-18 months. The Royal College of Emergency Medicine, Royal College of Nursing and the Royal College of Midwives all attacked the plans. 24 units are already marked for closure or downgrade.

The Cheshire & Merseyside STP is suitably vague, but the 21 Oct leaked version included:

  • Remapping of East Cheshire Trust elective and emergency care models.
  • Agreed long term models based on strategic relationship with University Hospital of South Manchester and Stockport FT.
  • Emerging clinical model: ED (Emergency Dept at Macclesfield Hospital) downgraded to MIIU (Minor Injuries & Illness Unit) staffed by GPs.
  • Agreed long term models for elective and emergency care in mid and south Cheshire based on strategic relationship with University Hospital of North Midlands: Mid Cheshire Hospitals cannot see any robust clinical links with Countess of Chester Hospital or Wirral University Trust Hospitals being sustainable given travel times and population distribution.

As to travel times, University Hospital of North Midlands is in Stoke. The existing Mid Cheshire A&Es are in Crewe and Northwich. From Northwich to Stoke is 37 min (27.5 mi) via the M6, if it’s not gridlocked. Macclesfield to Stockport is 38 min (12.3 mi) via the A523. NHS officials promptly denied the leak but the published plan is a smoother version of the same story.

The mid-Mersey region has adult A&Es in Southport, Whiston, and Warrington. The STP mentions 3 models of Urgent Care System:

  1. 3 Trusts will have a Type I – 24hr A&E (Consultant led 24 hour service with full resuscitation facilities);
  2. 3 Trusts will have a 24hr A&E (not specified as Type 1). High acuity patients will be transferred to the Emergency centre;
  3. 1 Trust will have a Type I – 24hr A&E, 2 trusts will re-profile opening hours with activity flowing to other 24/7 centres. This will lead to “Reductions in the consultant cover from 3 to 2 on call covering 3 sites” and “Activity transfer of 8,700-20,000 patients per year (one site).”

Yet A&E admissions and trolley waits are growing. From January to March 2014, St Helens and Knowsley had 29,400 emergency admissions and 180 patients waiting over 4 hours after the decision to admit. For Jan to March 2017, it had 41,393 emergency admissions and 1,284 trolley waits.

The Mid-Mersey plan also foresees “Ward reductions / closures based on reductions in Delayed Transfer of Care”. St Helens and Knowsley Delayed Transfers  grew from 768 in Jan to March 2014, to 1,621 in Jan to March 2017.

Privatisation

Back-office” is an insulting term for essential admin support services, mainly provided by NHS staff.

The STP aims to “deliver cost effective, efficient and commercially sustainable Back Office operations”. An Options Appraisal includes “Market Maturity Assessment” and “Identify Potential Providers”. The 30 June draft had 5 options: “– in-sourcing to best placed entities, consolidation of all the functions to a single location, setting up a C&M-owned Shared Services Centre, a joint venture with a private sector partner and outsourcing to the private sector.” It didn’t mention the debacle with Capita which led Liverpool NHS Trusts to take HR services back in house. It is also unclear how Cheshire & Merseyside can own anything, as the STP has no legal status.

Likewise, the STP aims to “deliver cost effective, efficient and commercially sustainable Clinical Support Services”. It mentions an STP wide C&M single managed Pathology service with plans to “Evaluate the potential for novation of contracts over time”. This sounds like a transfer of Path staff from NHS contracts to something else. The Medicines Information plan concludes “establish and transfer services”; another section mentions “new commercial vehicle(s) with proposed community pharmacy partner”. Meanwhile, Trusts may be allowed to use receipts from sales of land and buildings, i.e. transfers of assets from the public to private sector, to offset deficits created by underfunding. Expanding the use of digital technology will also transfer resources from the public to the private sphere. But computer systems are strong, stable, and foolproof, right?

Accountable Care

In the long run the most dangerous aspect may be the drive to create “Accountable Care Organisations” which the STP mentions 18 times with no details or background. The obvious question is, accountable to whom?

Accountable Care is a concept from the US health insurance market, the last place you would want to look for inspiration. The idea is that a group of healthcare firms take responsibility for providing care for a given population for a defined period under a contract with a commissioner, such as Medicare. ACOs seek to lower costs whilst achieving pre-agreed quality outcomes. They ‘align incentives’ between providers and commissioners, sharing any savings between hospitals, doctors and Medicare. The overall savings to Medicare are small, or negative, depending on just what is measured.

Health Maintenance Organisations, run by the insurers themselves, were the previous incarnation. They involved routine denial of patients’ access to medically necessary treatment, fighting claims, screening out the sick, paying exorbitant CEO salaries, fraud, and hidden costs in top-ups and deductibles. ACOs have healthcare providers in the lead. But the same insurance firms are driving the process. Simon Stevens’ former employer UnitedHealth already has US contracts with over 800 ACOs, and recently launched its own NexusACO, aimed at 15 US markets.

ACOs can use ‘capitated’ fixed payments to providers for all or most of the care that their patients may require over a contract period, adjusted for severity of illness, and regardless of how many services are offered. Clearly, once the payment is in place, providers may offer only as much care as required by the contract. The specified care may not be comprehensive, and the defined patients may not be the geographical population, but built from GP registered lists. The key ACO models are the Multispecialty Community Provider, and the Primary and Acute Care System. Both models aim to reduce avoidable hospital admissions.

All the NHS ACO plans simply accept the massive funding cuts. They assume that pooling NHS and local authority resources, and expanding new models of care in the community, will justify cutting hospital budgets. The National Audit Office and the Nuffield Trust have demolished those assumptions. NHS England now stresses the development of ACO precursors dubbed Accountable Care Systems. Either version will transfer the funding shortfall from the National Health Service to self-contained localities.

Northumberland CCG is £31m in debt, and its flagship ACO plan, a primary and acute care system, is going ahead in transitional form. Currently, community and mental health services have fixed budgets, while the acute sector uses Payment By Results. The ACO will assign fixed budgets to all parts of the system. As the County Council puts it:

“These arrangements are intended to ensure that the ACO is in a position to take steps to bring about a shift of resources from hospital to community services across the board, while also bearing the financial risk if investment in community services fails to achieve the intended reduction in demand for hospital care.”

These risks are with the NHS partners. Northumberland says “the only significant new risks for the Council are the reputational risks arising from increased involvement in NHS planning at a time when continuing public sector austerity will require hard decisions to be made.”

ACO plans are now surfacing in Warrington, St Helens, and West Cheshire.

Warrington has agreed to pool CCG and local authority health and social care budgets, and is “determined to move away from a national tariff-based payment system to a defined capitated budget.” The ACO Board comprises Warrington Borough Council, the CCG, Warrington and Halton Hospitals, Bridgewater Community Health, Five Boroughs Partnership, and GP representatives. It will plan for:

  • Shared accountability and risk share
  • Pooled/aligned budget arrangements.
  • Commissioning / contracting from the ACO to the health and care market.
  • An appropriate vehicle for delivery.

Corporate Joint Venture and (full) Merger are options for the structure.

St Helens is setting up an “Accountable Care Management System” to involve the CCG, health providers and St Helens Council. In April 2018 it intends to transfer: Adult and Children’s Social Services (excluding Youth Justice), Public Health, Community Health, Adult Care (excluding maternity), Primary Care, Mental Health, Community Safety, Community fire safety, Mental health street triage, Victim support, Probation, Ambulance. Others may transfer later. The only permanent exclusions are Youth Justice, Community fire protection, and Road safety. St Helens is now considering whether the ACMS will compete for tenders as a collective, and if the ACMS will issue tenders and procure services from others.

The West Cheshire ACO will “segment our GP registered population by risk”. It will issue a Memorandum of Understanding between providers, who are “challenged to advise how they can release a material portion of their existing resources to enable this transformation”. It will also issue a “prospectus”.

Evidence?

The NHS is supposed to deliver evidence-based medicine, clinicians are educated on that basis, and new treatments are only licensed after passing rigorous trials and cost-benefit analysis. But evidence is tossed overboard when making policy based on confident assertions. Why should anyone put up with it?

The St Helens plan purports to list evidence for each of their plans. None of it is referenced. For example “Stand alone telephonic case management has been estimated to reduce admissions by 5%.” Says who? The Nuffield Trust says there is mixed evidence on case management. Research at the University of Manchester published in 2015 is entitled “Effectiveness of Case Management for ‘At Risk’ Patients in Primary Care: A Systematic Review and Meta-Analysis”. From the abstract:

“This was the first meta-analytic review which examined the effects of case management on a wide range of outcomes and considered also the effects of key moderators. Current results do not support case management as an effective model, especially concerning reduction of secondary care use or total costs”.

St Helens says “Social prescribing has saved Newcastle West CCG an estimated £2 – £7 million”. This is actually the Ways to Wellness programme which started in 2015 and runs for 7 years. It hasn’t been evaluated yet. Nuffield describes it as a “large scale trial”. The savings it will achieve are, at this stage, only projected.

Warrington says “Evidence shows that proactive planning using risk stratification is a key tool to improving outcomes”. Again, no reference. The Nuffield review found risk stratification tools still struggle to identify ‘at risk’ individuals before they deteriorate.

The private sector are helping to design the ACO plans. PwC are involved in Tameside, Wigan, Manchester City, Oldham, Cheshire, and St Helens. West Cheshire CCG appointed PwC to undertake initial ‘due diligence’. That’s PwC which audited Philip Green’s BHS empire before it collapsed.

In St Helens, PwC supports the Project Management Office in proposals for Governance, IT, Business Intelligence, Communications and Engagement. A Workstream stakeholder reference group has Specialist input from three people, two of whom are PwC staff. The St Helens ACMS is developing under the auspices of a People’s Board, including the Council and NHS providers, but also the Community Rehabilitation Company and Helena Partnerships. Helena manages former council housing. The CRC is a privatised probation service, 75% owned by Interserve, a facilities management company with PFI and other health service contracts.

The private sector is also funding new models of care. The Newcastle Ways to Wellness programme is an outcomes-based contract funded through a Social Investment Bond which includes £1.65m from Bridges Social Sector Funds. Bridges Fund Management describes itself as “Capital that makes a difference”.

Private sector involvement goes beyond the STPs. Locally, the new Royal is financed through PFI. Consultants were recently emailed on the Trust’s intention “to develop a strategy to increase its private patient activity. As part of its development I am writing to you all to determine if there is an interest in developing your private patient activity from the Trust.”

Privatisation does matter. PFI and procurement are wasteful and private healthcare can be dangerous. Last July, Virgin Care lost its contract to run Croydon’s Urgent Care Centre 3 years after the CQC found patients being streamed by untrained reception staff. 30-year-old Madhumita Mandal died after a receptionist failed to refer her to a medic, though she was in agony with a ruptured ovarian cyst. Virgin defended the streaming procedure.

The End Game

The implications for wages, terms and conditions of NHS staff when employers merge across care sectors under PwC guidance, with local structures which will threaten national agreements, are immediate.

Looking further ahead, no private company is big enough to buy the whole NHS. But once the STP plans are implemented and ACOs are established across England, health transnationals will see discrete local systems with budgets of £1bn or less, with structures compatible with the US health insurance market. ACOs could receive investment funds, or be bought and sold. Perhaps that’s why they need a prospectus.

Theresa May insists that the NHS will remain free at the point of use. Even so, she does not mean a comprehensive, universal service, with decisions on treatment made according to clinical need, publicly provided, publicly accountable, funded out of general taxation.

Labour have promised a case-by-case review of STPs. Given the involvement of Labour local authorities in these plans, and in Devo Manc, this will not be a simple argument.

If the Tories win the election, expect them to accelerate STPs and ACOs, with new legislation if needed. We will need active resistance if the NHS is to survive.

 

 

 

 

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