Feature / Policy focus
New policy themes set by the HFMA Policy Forum are a framework for the association’s policy work and a focus for its expanding research activities. Emma Knowles reports
The HFMA has a well-deserved reputation for producing high-quality briefings and publications covering a wide array of topics. The diverse range of outputs over the years has been impressive, from technical briefings – for example, on the introduction of a new version of healthcare resource groups (HRG4), to the perennially successful Introductory guide to NHS finance. Looking ahead, the HFMA’s work programme is just as impressive in the breadth and depth of its coverage.
We recognise that pressure on NHS finance staff has never been greater. There is increasing pressure on NHS resources and a major restructuring under way to deliver the changes set out in the Health and Social Care Act. In recognition of the challenges facing the finance function, the HFMA is expanding its team of in-house experts and developing a dedicated research function. Looking ahead there will be no shortage of areas to research, guidance to produce, e-learning modules to develop and consultations to respond to.
The Policy Forum oversees HFMA’s policy and research activities and agrees the work programme. The forum consists of HFMA trustees, committee and branch chairs and a small number of national stakeholders. Forum members set the direction of the association’s policy, technical and research work and agree priorities. Five policy themes were agreed at the meeting at the end of January – themes that will provide a more cohesive framework for the association’s policy work and provide a basis for prioritising activities.
The policy themes have been selected for being the most important to improving the financial health of the NHS, the services delivered to patients and value for money for taxpayers. They have been chosen to ensure the association focuses on the areas where members need most support and will be regularly reviewed and updated. They are relevant to all sectors in the NHS in England, Northern Ireland, Wales and Scotland. The policy themes are:
- Transforming service provision: creating new models for the delivery of affordable, sustainable and high-quality healthcare
- Building a sustainable financial future: considering new models of funding and payment
- Knowing the business: developing clinical and financial engagement and collaboration
- Getting the basics right: delivering financial control and effective governance arrangements
- Giving a national perspective: presenting an overview of the NHS financial picture and contributing to the development of the NHS finance profession.
The first four themes are explained in the boxes alongside this article. The fifth – Giving a national perspective – will enable the HFMA to give an overview of the NHS financial picture and will draw on some of our regular work – the finance function census and a new project to gain a better understanding of how finance practitioners view their roles and careers.
The structure of the NHS in England is becoming increasingly fragmented with no single organisation responsible for overseeing and performance managing all NHS organisations. The HFMA has members in all sectors of the NHS and is in a unique position to provide an overview of the financial picture, the shape of the finance function and the financial challenges ahead in the four nations.
Work is under way on projects for each of the themes. In the next couple of months we will publish briefings on partnership working in the NHS, international approaches to costing (and patient-level costing) and gaining value in healthcare (with NHS Rightcare).
Research is in progress on how finance staff can support service transformation and we are working with the NHS Commissioning Board on identifying the financial implications of the move to deliver NHS services seven days a week. Also in 2013 the HFMA will be producing updated versions of the Introductory guide to NHS finance and the Role of the chief finance officer in the NHS and issuing more Medicine for managers briefings.
The overriding purpose of our work is to support members and play our part in delivering high-quality, safe care for patients and making best use of taxpayers’ money. If you have any comments on the policy themes or suggestions for work you would like to see the HFMA undertake, I’d be delighted to hear from you – email [email protected].
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Themes in perspective 1. Transforming service provision: creating new models for the delivery of affordable, sustainable and high-quality healthcare This theme covers the service transformation needed to establish new models of delivering healthcare. The NHS needs to change the way it does business. It has a model for service delivery that has evolved over the years, but much of the way it operates has been dictated by historic practice and by the location of existing facilities. The challenges facing the NHS have changed, the population is ageing and the number of people living with long-term conditions increasing. There is a trend towards greater clinical specialisation and an increasing recognition that some services are better delivered from centres of excellence, enabling a concentration of clinical expertise, with the right patient flows to maintain and improve skills, and the use of the latest equipment. Patient safety and quality of services are, and should remain, key drivers for change. Alongside this the Francis report on the role of the commissioning, supervisory and regulatory bodies in the monitoring of Mid Staffordshire NHS Foundation Trust made far-reaching recommendations that will affect the way all NHS organisations operate. The financial climate provides a further imperative to make changes. The NHS must save some £20bn by 2014/15 (compared with 2011). This will not be realised by traditional approaches to cost improvement – doing the same things with less money. Instead the NHS will need to design new, more cost-effective pathways of care that deliver high-quality outcomes and meet patient demands. 2. Building a sustainable financial future: considering new models of funding and payment This looks at the funding challenges ahead. While the last spending review delivered a relatively generous revenue settlement to the NHS (compared with other government spending departments), it also signalled significant cuts to the capital budget. In recent years, arguably the biggest constraint on providers’ capital programmes has been uncertainty over commissioners’ future service requirements and income. The service now faces additional constraints in terms of restrictions on central capital budgets and access to capital. Even where organisations have identified a capital project to take forward, there may not be the funding available to support it. In addition to this, over the last two decades, the private finance initiative (PFI) has often been seen as the only viable option for funding major capital projects. It continues to polarise opinion, with scrutiny on the links between financially challenged trusts and PFI and the ability of trusts to reduce PFI costs. However, only small numbers of organisations with PFI deals have been assessed as needing additional financial support. And other organisations have had positive experiences with PFI. There is a need to understand the options for funding capital projects in the future. On the revenue side Monitor has issued consultation documents proposing changes to the way that NHS services are priced. And a recent review by the King’s Fund has questioned whether payment by results is the best mechanism for delivering better care. There are challenges facing the NHS in the short term that need to be managed, but the longer-term picture is even more challenging. Both the revenue and capital funding models are in need of review. Strategic thinking is required to identify the service and financial challenges facing the NHS in 10 to 20 years’ time and how they might be resolved. 3. Knowing the business: developing clinical and financial engagement and collaboration This theme focuses on how finance staff, clinical staff and managers need to work closely together and respect each other’s values and principles in order to address the challenges facing the NHS. Emphasis has been placed on clinical engagement in financial management – but that is only part of the picture. Finance staff must have a good understanding of clinical matters – what and how services are delivered, the clinical processes – to deliver their financial responsibilities effectively. It is about going beyond a familiarity with the clinical language used and includes an appreciation of the key features of the day-to-day provision of services, the challenges and inter-relationships with other services, and the likely impact of future technologies. While this may require a change of approach for some finance staff, for others it will already be an intrinsic element of their work. ‘Knowing the business’ is not just about understanding finances and the clinical services delivered, but also thinking about them together. This will be important for example when planning for the introduction of new technologies or identifying areas where efficiency can be improved. Understanding the real costs of services will also play a vital role in supporting change and will require finance practitioners and clinicians to work together in compiling accurate costs and in analysing the resulting data. This clinical-financial engagement is also important in broader areas of financial management, such as service-line reporting, cost improvement programmes and business plans. Finance staff have a key role in helping and developing the financial knowledge of others. 4. Getting the basics right: delivering financial control and effective governance This theme focuses on the governance and financial control arrangements in place across the NHS. Despite a small number of notable exceptions, NHS organisations demonstrate high standards of financial control. At the end of 2011/12 the service as a whole reported an underspend of £2bn (2% of the revenue resource limit) and only a very small number reported a deficit. This is a positive position and a vast improvement on the position in the mid-2000s. The considerable effort put into improving NHS financial management arrangements at a local and national level has paid off and the credibility of NHS finance professionals has never been greater. However, the current funding pressures and ambitious cost improvement programmes will test NHS financial management. The new organisational structure of the NHS introduced as a result of the Health and Social Care Act 2012 and the increasing pressure on financial resources will test financial control and governance arrangements. The organisations established as a result of the new Act will all have new governance arrangements and new staff in post. It will take time for these organisations to mature and for systems and processes to bed in. Clinical commissioning groups are very different from the organisations they replace and many CCG members will have no board experience. Shared service arrangements and the relationship with the Commissioning Board will also take time to develop. If service transformation and improved patient care is to be achieved it is vital that standards do not slip and financial control is maintained. |
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