Workshop A -Commissioning Finance Danny Storr – Head of Finance NHS Hull Clinical Commissioning Group

j CONTENT So what is Commissioning Accountabilities and Responsibilities Financial Duties for Commissioners The main challenges for commissioning What does the future hold

So what is commissioning? j “It is the process by which commissioners identify the health needs of their population and make prioritised decisions to secure care to meet the needs within available resources.”

So what is commissioning? j

How the PCT spends its money: So what is commissioning? j How the PCT spends its money: Area of Spend % Acute Contracts (inc specialised) 44% Primary Care, Dental, Pharmacy, Ophthalmic 16% Non-NHS Healthcare Contracts (inc reablement) 13% Primary Care Prescribing 10% Mental Health & Learning Disabilities Contracts 7% Continuing Healthcare 4% Ambulance Contracts 2% PCT Running Costs Other Total 100%

Accountabilities and Responsibilities cfS The Old Structure

Accountabilities and Responsibilities The New Structure

Responsible for spending tax payers money Accountabilities and Responsibilities j Responsible for spending tax payers money Responsible for achieving value for money i.e getting the most out of every £ spent Standing Financial Instructions govern the rules

Financial duties for Commissioners j Remain within revenue and capital resource limits Not to spend more cash than we are allocated i.e. not to be overdrawn at the bank To pay 95% of invoices with 30 days To remain within running cost (previously management cost) targets Submit statutory returns (annual accounts & audit)

Major financial challenges in Commissioning Exercise

j Some of the challenges: How the funding will be divided across the new system Hitting financial targets (either way) Prioritising which areas of health to spend resources Dealing with conflicting demands (long term v short term) Market Management / behavioural changes Clinical Engagement (all above) Delivering QIPP agenda Coping with change

j Dealing with the challenges: Strategic direction set by the Board (using Public Health Science) Well structured planning process (start early) Engaging stakeholders in development of services Effective budgetary control procedures (plan A,B, C…) Good relationships with providers Good lines of communication throughout the organisation and with the public Strong understanding of cost drivers and knowledge of contracts Teamwork

What does the future hold? j PCTs and SHAs will be abolished NHS Commissioning Board created Clinical Commissioning Groups created Commissioning Support Services created Local Authorities / Public Health England altered / created Property Services Ltd created

What does the future hold? j Commissioning of services from April 13 will be as follows: Public Health commissioned by local authorities NHS CB and PHE Primary Care commissioned by NHS CB Specialist Services will be commissioned by NHS CB Everything else will be commissioned by CCGs Estates managed by Property Services Ltd

j Questions???

Stage 1 – Strategic Planning So what is commissioning Stage 1 – Strategic Planning Identify need Review pathway and current services Decide priority requirements (evidence based) Products and tools for this stage: Joint Strategic Needs Assessment Commissioning Strategy Medium Term Financial Plan (which is purely a financial interpretation of the commissioning strategy)

Stage 2 – Commissioning & Procure Services So what is commissioning Stage 2 – Commissioning & Procure Services Design pathway, services and specifications Plan capacity and manage demand Market management and procurement Contract for Service Products and tools used for this stage: Service specifications including KPIs and information requirements Contract documentation and governance framework e.g. Contract management Boards Budget and activity information available CQUIN indicators

Stage 3 – Performance Management and Evaluation So what is commissioning Stage 3 – Performance Management and Evaluation Manage performance Evaluate outcome and provision Products and tools for this stage: Monthly, quarterly and annual performance reports on financial and other indicators Provider management framework