National programme to localise commissioning of specialised services

Background

To date, ICSs have not played a major role in the planning of specialised services. Since 2013, NHSE has held legal and operational responsibility for commissioning specialised services – planning services, setting clinical standards, allocating resources, contracting with, and reimbursing providers and monitoring service performance. In practice, NHSE's national teams focused on setting strategic direction and priorities, and regional teams led on more operational commissioning, including contracting, supporting service developments and monitoring.

In recent years, NHSE has signalled that systems would, in time, play a greater role in planning specialised services, but formal changes were limited, and ICSs' involvement in specialised commissioning has to date been largely advisory, particularly as they initially inherited the responsibilities of clinical commissioning groups (CCGs). The passage of the Health and Care Act 2022 provides a platform for systems to take on a new role in relation to specialised services, including through enabling the delegation and joint exercise of statutory functions between NHS organisations, including NHSE, ICBs and providers.

Over a similar period, provider collaboratives have emerged as key partnership vehicles which are intended to take a leading role implementing some ICS ambitions. Collaboratives are partnership arrangements that bring together two or more trusts (and, in some cases, other partners from the voluntary or independent sectors) to drive economies of scale and improve care for local populations. NHSE mandated acute/specialist and mental health trusts to be part of at least one collaborative from July 2022, with community and ambulance trusts joining collaboratives where doing so could help improve care for patients.

For several years mental health and learning disability trusts have been joining together as part of NHS-led provider collaboratives to drive change in specialised mental health, learning disability and autism care. One focus among these mental health collaboratives has been rethinking commissioner – provider relationships, with many collaboratives developing lead provider arrangements whereby they take on some specialised mental health planning responsibilities from NHSE. This has involved budgets for defined pathways being devolved to collaboratives with trusts working together, including sub-contracting among collaborative members, to discharge operational planning and service transformation responsibilities.

NHS England's 'Roadmap' for specialised services

In May 2022, NHSE published a document, the Roadmap for integrating specialised services within ICSs, outlining concrete proposals for how it would progress systems playing a more leading role in specialised services. The 'roadmap' set out a number of planned changes, the most material of which are summarised below:

• Service portfolio analysis. During 2022, NHSE conducted an analysis of the specialised service portfolio to determine which services could be locally led by ICSs. Services were assessed against two criteria: i) suitability for local commissioning and ii) readiness for local commissioning in 2023/24. A range of factors and insights informed the assessments, including the scale of financial volatility associated with the services, the numbers of providers delivering care, opportunities to drive patient benefits and the pipeline of future clinical innovations in a service area. Based on that, the portfolio was divided into three categories:
  
  - services which are suitable and ready for greater ICS leadership from April 2023
  - services which are suitable for greater ICS leadership but are not ready at this point
  - services which are not suitable for ICS leadership and will remain nationally commissioned (including so-called highly specialised services which serve small numbers of patients – usually less than 500 per year – and are delivered by a few centres around the country).
  
  

NHSE plans to continue conducting service portfolio analysis to reassess services' suitability for local commissioning. In time, it is possible that more services will be assessed as suitable and ready for greater ICS leadership.

• ICB role. NHSE's policy is that over time ICBs will take on a greater role in commissioning the specialised services which are assessed as suitable for local leadership. This role will take two possible forms:
  
  - joint commissioning with NHSE where ICBs are not ready to take on full delegation (by forming a joint committee with NHSE as a transitional step)
  - taking on delegated responsibility whereby operational responsibility for commissioning these services sits with ICBs and budgets are delegated (underpinned by an oversight and governance arrangement with NHSE based on a delegation agreement).

An increased role around specialised services is intended to complement ICBs' existing portfolio of commissioning responsibilities across primary, community, acute, ambulance and mental health services with a view to supporting more joined up planning and care delivery. The roadmap states that ICBs can begin to take on these responsibilities from April 2023, and the portfolio of specialised services led by ICBs will grow over time as more services are assessed as ready for delegation. NHSE expects many ICBs will work together in groups to commission specialised services over multi-system footprints. Latest national policy indicates – subject to approval from NHSE's board – that joint working arrangements will be the default model in 2023/24 , with full delegations planned to go live in 2024/25.

Changes to funding allocation formula. The bulk of NHS funding is allocated to ICBs by NHSE based on a funding formula which tries to account for differences in populations' demographic characteristics and health needs (informed by the independent advisory committee on resource allocation – ACRA). To date, specialised services have been funded using a different mechanism, more strongly influenced by historic spending patterns. As part of the move to systems leading specialised services, NHSE plans to transition to providing funding to ICBs for specialised services. This will initially use historic spend information that supports host-based allocations but over time, this will transition towards an allocation based on a population needs-based formula, bringing these services more into line with other funding streams. NHSE expects to implement a 'needs-based' allocation model in a phased way from 2024/25, with 'pace of convergence' safeguards to ensure systems do not see destabilising changes in funding levels.

• The role of NHSE. Since 2013, NHSE has been solely responsible for commissioning specialised services. In the future, NHSE will continue to hold legal accountability for the whole portfolio (including where services are delegated) and perform a number of functions nationally. These will include: commissioning services which need to be planned nationally; setting national service specifications and clinical policies for all specialised services; facilitating clinical engagement with specialised service planning; and supporting patient and public involvement in national planning. Alongside, NHSE will develop an oversight and assurance framework, informed by a data infrastructure, to monitor how ICBs are discharging any localised commissioning responsibilities. Where joint commissioning is used, NHSE will continue to hold much of the operational commissioning responsibility and work with ICBs to make decisions about specialised services.
  
  

The 'roadmap' also set out a rough timeline that NHSE and ICSs would work to in order for the first tranche of localised commissioning arrangements to go live from the start of 2023/24 (see table below). In addition to playing a larger role in specialised services, from 2023/24 ICBs are expected to be taking on commissioning responsibility for pharmaceutical services, ophthalmic services and dental services which were previously directly commissioned by NHSE.

Key milestones in transition to localised specialised commissioning