The 366 words that could reshape the NHS

The 10-Year Health Plan is more than 60,000 words long, and just 366 of those are about integrated health organisations (IHOs).

But that has been enough to attract a lot of attention and kick off a new discussion about the future of the provider sector.

Details are still to come, but the vision has been sketched out. In very simple terms, IHOs will be the 'very best' providers, put in charge of the budget for a population, and given more freedom over how that budget is used.

The idea is not new – similar proposals were made more than a decade ago in the Five-Year Forward View.

But if pursued, IHOs have the potential to reshape the trust sector landscape, the role of providers, and the relationships they have with their local partners.

The answers to three questions will determine how they develop.

• How do IHOs fit into the wider vision outlined in the 10YHP?
• How will they be established?
• Can any trust be an IHO?

The wider 10YHP vision

In the short passage on IHOs, the 10YHP states around seven distinct though interrelated purposes: improve patient care; enable investment, for example, in capital and digital; support small businesses; drive integration; shift resources from hospital to community; improve population health; and tackle inequalities.

Many of these purposes are core aims of the 10YHP. So are IHOs seen as essential to delivering the 10YHP vision? Possibly, as one passage of the 10YHP states, they will 'become the norm'.

But other programmes are also being developed with similar goals in mind – the new foundation trust model similarly promises a reset of provider autonomy, plus financial benefits for high performers. And the neighbourhood project aims to integrate care and shift to the community using a different set of novel contracts and organisational models.

As policy is developed for IHOs, it will be important to start from a vision for the future NHS offer, and then understand what this model can uniquely contribute to bringing that about.

Establishing IHOs

The 10YHP states IHOs will be selected via a rigorous authorisation process. Similar suggestions have been made about the new FT authorisation process, and it will be important to ensure the two policies are coherent and fully integrated. For both, it will be helpful to know soon what criteria will be used and how they will be applied objectively.

IHOs are intended to be an FT with an expanded remit and additional responsibilities, particularly around population health and contracting other providers. In short, one that operates very differently from most providers today.

Care will need to be taken to define the IHO/commissioner relationship. The stated intention is for longer-term contracts and greater autonomy, and that does not remove the need for a commissioner. It may mean, however, that IHOs will take on some functions currently held by integrated care boards, and providers and commissioners will need to work together differently.

So successful IHOs will need to have a set of capabilities that trusts do not usually need to have at present. Judging which trusts are capable based on existing performance will therefore not be easy. And part of establishing IHOs will be about building these additional capabilities, which will take time and may need support.

But provider capability is only one half of the equation: the other is where IHOs are most likely to add value. Will some places or populations particularly benefit from an IHO approach, and will this be factored into authorisation decisions? Fundamentally, this comes down to a choice about the starting point for creating a new IHO: is it provider capability, or population need? Different answers will lead to different approaches from policymakers.

Will IHOs all be the same?

This is the question being asked most often by provider leaders at the moment. Will the IHO be essentially the same everywhere – or will it develop differently in different places?

The 10YHP says IHOs will hold the 'whole health budget' for a 'local population' (and elsewhere, a 'defined population').

This leaves room for interpretation. It could mean the IHO is responsible for all the health services used by the whole population in a particular place: this would mean all IHOs are pretty much alike in scale and scope.

But a 'defined population' could also mean a segment of a bigger population, which would open the door to IHOs focused on older people, for example, or those with mental health needs.

The services in scope will determine the scale an IHO operates on: a 'whole health budget' including a lot of specialised services will mean a big catchment population. Smaller populations, however, could be served if the focus remains on GP, community and some specialist care – this could lead to very locally-focused IHOs, not much different to a trust holding a multi-neighbourhood contract.

If any high-performing trust is eligible, it is easy to imagine a variety of models emerging: a high-performing standalone community trust would lend itself to becoming quite a different type of IHO to a mental health trust, an integrated acute and community provider, or a large tertiary acute provider.

But if the vision is for IHOs to always be large, all-encompassing providers, the process of establishing them will be partly about judging whether or not a trust is able to operate at that scale.

The deadline to identify the first IHOs is next year - that is not long, and the details are being worked on rapidly right now. But while the direction has been set, we still face some fairly fundamental choices about how to move forward.

This article appeared first in Health Service Journal.