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2011/12 Operating Framework

2011/12 Operating Framework. Vanessa Harris 21 st December 2010. Transition & Reform. What needs to happen in 2011/12 to realise the White Paper’s aspirations in terms of new organisations and roles. Transparency & local accountability.

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2011/12 Operating Framework

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  1. 2011/12 Operating Framework Vanessa Harris 21st December 2010

  2. Transition & Reform What needs to happen in 2011/12 to realise the White Paper’s aspirations in terms of new organisations and roles Transparency & local accountability Where we can get better at local accountability and how we support a revolution in patient power Service quality How we maintain delivery and meet QIPP challenge Financial &business rules System levers and enablers System accountability Planning and assurance Overview of structure for NHS OF 2011/12 The Operating Framework sets out the priorities for the NHS in 2011/12, the first full year of the transition, and the changes to national levers to enable the system to deliver Focus is on: Supported by:

  3. Transition and Reform Local Level: • Will undertake a managed consolidation of PCT capacity, Clusters. Will have a single Executive Team and be in place by June 2011. • Includes requirement for £2 per head development fund – funded from management cost savings Stronger Contracting: • All contracts must be signed by start of financial year. • PCTs to ensure that contracts allow for Providers to manage demand in their own organisations. • PCT to use contract sanctions if not satisfied with data. SUS will be standard repository by April 2012 and progress towards deadline performance managed in 2011/12

  4. Service Quality QIPP: • Commitment to £20bn efficiency challenge, despite changed assumptions of CSR and pay freeze • QIPP to be embedded in a single operational plan for each SHA and PCT Key New Commitments: • New coalition commitments e.g. more Health Visitors and Family Nurse Partnership expansion

  5. Finance and Business Rules Surplus Strategy: • Expected drawdown of SHA / PCT surplus will be £150m (c.15%) • No PCT to plan operating deficit in 2011/12. Trust deficits planned only where part of a planned recovery, in agreement with DH and SHA • Requirement for 2% of PCT recurrent resource to be spent non recurrently for each PCT • 2% will be held by SHA and accessed only through agreement of business case • GP consortia will not be responsible for resolving legacy debt that arose prior to 2011/12. PCTs must ensure that debt issues are resolved by the end of 2012/13 • GP consortia to work closely with PCTs to prevent PCT deficits over the next two years

  6. Finance and Business Rules PCT Allocations: • Average growth in recurrent allocations is 2.2%. • Including non recurrent allocations for social care, PDS, GOS and pharmacy average increases of 3%. Running Costs • 2010/11 last year for reporting PCT, SHA and Provider management costs. For SHA and PCTs will be replaced by “running costs” from 2011/12. By 2014/15 running costs to reduce by one third from current (2010/11). Details to be provided as part of Planning Guidance. • GP consortia could have a running cost allowance of £25 - £35 per head by 2014/15

  7. Finance and Business Rules Capital: • Trusts: Primary source of funding will continue to be internally generated cash and interest bearing loans • Capital allocation unspent from 10/11 not carried forward • No expectation that a central capital budget programme will exist in 11/12. All capital requirements will be handled as part of planning process • Regime for new community Trusts will follow NHS Trusts • Spending review means smaller financial envelope for capital. Trusts are expected to prioritise backlog maintenance and patient safety, privacy and dignity • PCTs: There will be no automatic capital allocation for PCTs with funding being granted on a cases by case basis

  8. Finance and Business Rules Tariff: • Increase in use of Best Practice Tariffs. • Reduction in payments for short stay patients attracting a long stay tariff • All tariffs set 1% below average cost (Originally this was targeted to certain tariffs only). • Result of these changes is that published tariff will reduce by 2%. Inflation of 0.5% added to this – net effect 1.5% reduction. • Non tariff services also subject to 1.5% reduction • 4% provider efficiency to offset 2.5% pay and prices inflation

  9. Finance and Business Rules Tariff: • Adult Renal Dialysis comes into scope of PbR. • Changes to A&E, Specialist Tops Ups, Critical Care currencies • Service users in Mental Health allocated to tariff clusters • 30% marginal rate continues for emergency activity over the 08/09 baseline • No payment for Emergency readmissions following Elective admissions, local agreement about other readmissions within 30 days • Option to provide services at lower than national tariff • Actual impact of 11/12 tariff on PCTs is most closely aligned with most favourable WCC scenario from 10/11

  10. Further Information Includes • 2011/12 National Tariff and Guidance (incl. 30 day readmissions) – Dec 2010. • PCT Allocation Working Papers – Mid January 2011 • Detailed Planning Guidance (incl. 2% non-recurrent, running costs definitions) – End January 2011 • Information Strategy – Early 2011 • Detail on Operation of the Cancer Drugs Fund – Advice published following consultation

  11. Finance and Business Rules PCT Allocations and Distance from Target

  12. Planning Timetable – PCTs and NHS Trusts January 19th – Submission of Initial Plans by Trusts and PCTs to SHA • High Level DH templates covering I&E, Capital and Resource and Applications (PCTs) • Income, Activity and Operating Costs bridge from 10/11 • High Level workforce numbers • QIPP – SHA planning to use 30th November / 31st December QIPP returns from orgs • SHA Templates by December 31st March 11th – Submission of final FIMS plans by Trusts and PCTs to SHA

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