Oversight framework updated for system start

by Steve Brown

29 June 2022

Integrated care boards (ICBs) and NHS providers will each be monitored against three financial metrics as part of the updated NHS oversight framework.

The new framework comes into operation on 1 July as new ICBs are created, clinical commissioning groups cease operation and system working is formally launched. The framework sets out how system and provider performance will be monitored against NHS priorities and identifies where boards or providers may need support. It will also provide the basis for triggering when and how NHS England will intervene.Miriam Deakin

The framework is built around six themes. Five of these – quality of care; access and outcomes; preventing ill-health and reducing inequalities; people; finance and use of resources; and leadership and capability – are underpinned by a set of high-level metrics at both ICB and trust level. A sixth theme specifically focused on systems – local strategic priorities – recognises the need to address local issues and challenges.

There are four metrics within the finance and use of resources domain. Two of these are applicable to both ICBs and provider trusts. These are a financial efficiency metric (measuring variance from the efficiency plan) and a financial stability metric (measuring variance from break-even).  Systems will also be assessed against the achievement of the mental health investment standard. This requires ICBs to increase spend on mental health services by more than ICB programme allocation base growth, prior to the application of the convergence adjustment.

Agency spending at NHS providers will also be monitored. Providers have previously been assessed against their distance from their nationally set agency spending cap. Scrutiny of agency spending controls were relaxed during the first years of the Covid pandemic, but NHS England has now prioritised a move back towards compliance with agency controls.

During the first wave of Covid-19, there was a significant decrease in agency shifts, with a shift towards more bank work. However, overall temporary staffing costs increased in 2020/21. In its evidence to the pay review bodies, the Department of Health and Social Care said that pressures in 2021/22 were expected to continue into 2022/23, due to Covid pressures and elective recovery, driven by both price and volume affects. However, it said the aim was to ‘put in the building blocks for sustainably reducing agency spend in the future’.

The intention is to identify emerging issues and concerns so they can be addressed early, with the metrics across all domains used to inform the allocation of ICBs and trusts to one of four segments. This determines the level of support needed ranging from no specific needs (segment 1) to a requirement for mandated intensive support (segment 4). Segment 2 is the default segment for all NHS bodies, unless the criteria for moving into another segment are met.

Ninety-nine trusts are in this default segment with a further 32 in segment 1, according to an updated provider segmentation published at the end of last week. There are 66 trusts judged to be in segment 3, deemed to be in need of significant support against one or more of the relevant five oversight themes. And 15 trusts remain in segment 4.

Integrated care systems were allocated to segments last November, with just one system placed in segment 1, but five being put in segment 4.

ICBs and trusts allocated to segment 4 enter the national recovery support programme, which has replaced the separate quality and finance special measures regimes in place between 2013 and 2021.

NHS Providers welcomed the updated framework. ‘It is particularly significant that the new framework has given a clearer definition of roles and responsibilities between NHS England and integrated care boards in terms of oversight and support, as well as a growing consideration of local context,’ said director of policy and strategy, Miriam Deakin (pictured). ‘What will be crucial is how the framework is applied in the context of NHS England’s new operating model, which is eagerly awaited. We look forward to engaging further with NHS England on this.’