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CCGs turn to providers for advice on how to cut costs by 20%

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Two CCGs are seeking the views of their various providers after they were tasked by NHS England with reducing running costs by a massive 20%.

Halton Clinical Commissioning Group (CCG) and Warrington CCG were advised last year that their budgets would be reduced by a further 20% by 2020/21.

In addition, the NHS Long Term Plan published in January 2019 signalled the direction of travel, with streamlining of commissioning and a focus on ‘place’ and integrated care systems.

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This has presented both CCGs with “a real challenge” and since last November the CCGs have been working to identify actions to reduce running costs but are now said to have “ exhausted all internal actions” to reduce spend.

Both CCGs said it “is simply impossible” for themselves to make the required reduction on their own.

When considering what could be done to make the savings and at the same time meet the ambitions of the NHS Long Term Plan, the CCGs have been exploring all potential options, including mergers, integration with the Local Authorities, and alignment of commissioning across a wider footprint.

A long list of options were evaluated against criteria that included benefits for patients, alignment with the NHS Long Term Plan, being coterminous with local authorities, clinical leadership and financial management.

A joint meeting of the NHS Halton CCG and NHS Warrington CCG governing bodies determined that there were three viable options:

Option 1 – Formal merger of the two CCGs

This would build on the current integrated working arrangements but will mean the establishment of an entirely new CCG, with a single management team, governing body and one set of statutory duties to be delivered, coterminous with the local authorities.

Savings would be made as the duplication would be greatly reduced. In addition, this would support the ambitions of the NHS Long Term Plan, retaining a focus on ‘place’ across both Halton and Warrington, whilst supporting the streamlining of commissioning and reducing running costs. 

Option 2 – Do nothing

This option would be to remain as is, with two separately accountable CCGs. There are already some benefits in terms of the integrated management team, the move to a single functional base and the alignment of some work programmes. 

However, there will still be a lot of duplication in terms of governance arrangements, with two governing bodies, accounts, commissioning plans and work programmes. 

This option would maintain the status quo but does not offer any benefit in terms of economies of scale nor deliver the required reduction in costs or fulfil the vision of becoming a strategic commissioner in line with the NHS Long Term Plan.

Option 3 – CCGs integrate with their respective Local Authorities

This option would be integration as it would not be possible for the CCG to fully merge with the Local Authority as a single entity as Local Authorities and CCGs are different legal entities with separate statutory responsibilities.

This option would also require a considerable amount of time to implement, even with complete sign up of all organisations and a level of duplication would remain as CCGs are accountable for delivering the financial and constitutional targets.   

In addition, this option may not meet the financial requirement to achieve a reduction in the running cost allowance by 20% in the mandated timescales. 

You can have your say HERE.

Tags : ccgNHSnhs englandwarrington ccg
Joe Peskett

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