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Finance Report Month 3 2011-12

Finance Report Month 3 2011-12. Jonathan Wise, Director of Finance & Performance. NHS BRENT FINANCE REPORT 11/12 - CONTENTS. Summary [Slides 3-7] M3 Position [Slides 8-33] Forecast outturn position [slides 34-38] Appendices Detailed finance schedules [Slides 39-49]. 2.

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Finance Report Month 3 2011-12

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  1. Finance ReportMonth 3 2011-12 Jonathan Wise, Director of Finance & Performance

  2. NHS BRENT FINANCE REPORT 11/12 - CONTENTS • Summary [Slides 3-7] • M3 Position [Slides 8-33] • Forecast outturn position [slides 34-38] • Appendices • Detailed finance schedules [Slides 39-49] 2

  3. SECTION 1 – SUMMARY 3

  4. EXECUTIVE SUMMARY • The month 3 report is based on the latest information available. Slide 16 indicates some data quality issues with acute contract information. • The month 3 report includes performance against QIPP. The Month 3 and forecast outturn (FOT) variances have been analysed between QIPP/non-QIPP as per the table below: • The QIPP position is shown in detail on slides 32-33. • Overall at month 3 the position is break-even against plan. The forecast outturn at month 3 is also breakeven against the plan of £11.6m surplus. 4

  5. FINANCIAL PERFORMANCE SUMMARY (1) YTD FOT • Statutory duties • Underspend against revenue resource limit • Achievement of capital resource limit • Achievement of cash limit • Underlying recurrent position • Achievement of overall financial plan • Achievement of public sector payment policy • Achievement of 11/12 QIPP plan G G G G G G G G G G A G G G 5

  6. SUMMARY OF MONTH 3 AND FORECAST OUTTURN • Year to Date Position • The year-to-date position at month 3 is breakeven, made up of overspends of £0.8m on acute contracts, £0.1m on community contracts, £0.1 on Public Health offset by underspends of £0.3m on joint working budgets, £0.2m on corporate costs, 0.1m on prescribing, £0.1m on primary care and £0.3m on reserves. • Forecast Outturn Position • The forecast outturn position is breakeven. This is made up of forecast overspends of £0.5m on community contracts and £0.2m prescribing, offset by underspends of £0.5m on joint working, £0.1m public health and £0.1m on primary care. 6

  7. UNDERLYING (RECURRENT) FINANCIAL POSITION • In order to understand the financial position of the PCT, it is important to distinguish between recurrent (underlying/run rate) and non-recurrent (one-off) income and expenditure items as it is the recurrent position that is core determinant of on-going financial sustainability; • The year-end outturn, adjusted for the major one-off items is set out below: • £m • Year-end outturn 11.6 • Non-recurrent allocation items 3.4 • Non-recurrent expenditure 4.0 • Underlying financial surplus/deficit 19.0 7

  8. SECTION 2 – MONTH 3 POSITION 8

  9. OVERVIEW OF BUDGET POSITION AT MONTH 3 • The increase in Reserves/Investment of £0.3m reflects an increase in allocation assigned to reserves as funding is already incorporated in budget lines • There has been a net increase in issued budgets reflecting confirmation of SLA values less deductions relating to the PCTs contribution to the London Health Programme and Levies. 9

  10. SUMMARY OF YEAR TO DATE VARIANCES - MONTH 3 Explanations for the main variances are included on the following slide.

  11. SUMMARY OF YEAR TO DATE VARIANCES Acute Commissioning (£0.8m) unfavourable - Currently 9 out of the remaining 22 acute contracts are showing overspends at month 3. Overspends reported at NWLHT £0.26m, Imperial £0.53m, Hillingdon £0.1m, RNOH £0.1m, Royal Brompton & Harefield £0.2m, East & North Herts £0.1m, Guys & St Thomas’ £0.1m and Royal Marsden £0.1m. Under spends at Royal Free £0.3m, Barts £0.1m and UCL £0.1m. Other Acute Commissioning – breakeven - This are includes London Specialist Commissioning Group (Acute & Mental Health), Other Specialist Commissioning for Acute and Mental Health, Cost per Case, High Cost Drugs and Non Contracted Activities. At month 3 there is a breakeven position. Joint Working Commissioning (£0.3m) favourable - Underspends on Continuing care Children(£0.2m) and Continuing care Adult (£0.1m). Community Commissioning (£0.1m) unfavourable - This includes the community services, walk-in centres, STARRS and UCC-Care UK services. Prescribing (0.1m)Favourable - Favourable position at month 3 relating to April 2011 data. Expenditure information relating to month 2 and 3 are estimated to budgets. Primary Care (£0.1m) favourable – Medical contracts are under spending by £0.1m due to a reduction in the contract value with Out of Hours providers. Estates (£0.02m) unfavourable - This includes the cost of all the sites including depreciation and the cost of capital. Small overspends on some sites. Corporate Costs (£0.2m) favourable - This includes all the corporate cost centres, public health and the recharge costs to the sector and London wide. Small underspends shown across a range of headings. Public Health (£0.1m) unfavourable - This includes public health commissioned services including Sexual health, Drugs and Alcohol Treatment and Smoking Cessation. There is an overspends on Sexual Health of £0.1m. 11

  12. ACUTE CONTRACT MONTH 3 • Figures used have been based on Month 2 Trust reports as reported by the ACV • ACV are investigating the reported SLAM figures further as some in sector Trusts have potentially reported incorrectly on NEL Thresholds, Emergency Readmissions and Contract Terms e.g. Outpatient Ratios • Reported Trust figures exclude ACV Challenges and impact of any year-end ceiling agreements connected with non recurrent support for NWLHT and Imperial • Out of Sector contracts – budgets reflects latest position and advice from Acute Commissioning Vehicle for contract values and Trust reported figures for actuals. • Total YTD performance: £822k overspend • Forecast Outturn (FOT) position: Break-even. Extrapolating the YTD position to year-end gives a overspend of £4.3m (1.8%). An in-year over-performance risk reserve of £7.3m, equivalent to 3.1% of the acute contract baseline, has been set aside to manage acute contract over-performance. The value of the reserve was assessed as reasonable given the level of acute over-performance in recent financial years. This reserve has been used to offset the forecast over-performance at month 3. 12

  13. ACUTE CONTRACT POSITION – MONTH 3 The Year to Date Analysis is based on Month 2 Performance Reports for each Trust forecasted to Month 3 on a straight line basis. There are a number of Out-of Sector 11/12 contracts which have not yet been agreed, including Royal Free, UCLH, East & North Herts and Royal Marsden. Where the contract value is not yet available the month 2 position is based upon estimated values.

  14. ACUTE CONTRACT POSITION – MONTH 2 (1) 14

  15. ACUTE CONTRACT POSITION – MONTH 2 (1) 15

  16. ACUTE CONTRACT POSITION – MONTH 2 (1) Actions in the above table are due for review by the end of August or are ongoing. 16

  17. ACUTE CONTRACT POSITION – MONTH 3 The above table analyses £’000s under/(over) performance by POD by Trust. Over performance in excess of £20k has been highlighted in yellow. The Year to Date Analysis is based on Month 2 Performance Reports for each Trust forecasted to Month 3 on a straight line basis. 17 17

  18. ACUTE CONTRACT POSITION - MONTH 3 • The following graphs compare monthly activity levels in 2010/11 with 2009/10 and 2010/11. There may be differences in the variances shown in slide 15 and the following slides due to: • Slide 17 is expressed in financial variances and the following slides are expressed in activity. • Activity slides cannot take into account case-mix and the impact of contract levers e.g. outpatient follow-up ratios • Non PbR spend areas such as Critical Care, Excluded Drugs & Devices, Direct Access, Renal and Other Exclusions are not reflected in the Acute Activity Analysis graphs. PbR cost pressures such as Accident and Emergency are also not reflected in the Acute Activity Analysis graphs. • The following slides show actual activity changes year on year: • - outpatients 0.3% decrease; • - elective admissions increase of 2.6%; • - non-elective admissions decrease of 3.6%; • - births have decreased of 4.8%. 18 18

  19. ACUTE ACTIVITY ANALYSIS (1) - OUTPATIENTS Against the comparative period of April- May 10 , there is a decrease in activity of 0.3%. 19

  20. ACUTE ACTIVITY ANALYSIS (2) - ELECTIVE Against the comparative period of April – May 10, there is an increase in activity of 2.6%. 20

  21. ACUTE ACTIVITY ANALYSIS (3) – NON-ELECTIVE Against the comparative period of April – May 10, there is an decrease in activity of 3.6%. 21

  22. ACUTE ACTIVITY ANALYSIS (4) – BIRTHS Against the comparative period of April – May 10, there is an decrease in activity of 4.8% 22

  23. CLAIMS MANAGEMENT The ACV undertakes a number of contract challenges each month including attribution checks, rule based checks such as Non-Paediatric Outpatients coded as Paediatrics, OP Attendances during period of admission etc. and clinical checks such as A&E re-attendance within 2 hours, multiple day cases on same day. There will also be challenges relating to the 11/12 contract levers such as testing that the outpatient ratios and day-case to outpatient ratios have been calculated correctly, Planned Procedures with Thresholds charged correctly, emergency marginal rate adjustments calculated correctly, emergency re-admissions treated correctly. In addition the ACV will measure the quality metrics included in acute contracts and apply the financial consequences of breaches where these have been agreed in the 11/12 contract. At the time of this report there limited information available from the ACV on the value of challenges or expected outcome of challenges in 11/12. The PCT also undertakes attribution checks on non-contracted activity, high cost drugs and cost per case invoices. 23

  24. SPECIALIST COMMISSIONING – MONTH 3 • LSG Report depicts YTD position at month 2 £126k unfavourable • Main areas of risk at month 2 are NICU and Forensic Mental Health – WLMHT • NICU is showing £190k overspend and Forensic Mental Health WLMHT £193k overspend. • FOT position at month 3 after risk share agreement are applied £5k favourable • Board Report reflects a breakeven position for both YTD and FOT at Month 3 as the LSCG report was received after the month 3 position was finalised. 24

  25. SPECIALIST COMMISSIONING – LSG REPORT SUMMARY 25 N.B. Figures represent Month 2 data from providers

  26. JOINT WORKING VARIANCES – MONTH 3 • Continuing Care Adults (£0.1m) favourable– The year to date variance for the whole of continuing care adults is budgets underspend of £58k due to closed care episodes. • Continuing Care Children (£0.2m) favourable– The year to date position is budgets underspend of £165k due to four high cost closed care episodes. • Children and Families Breakeven– The position for the service is breakeven at end of month 3. • End of Life – Hospices (£0.04m)– The position is a favourable variance of £35k due to low activities. • Community Services (£0.1m) Unfavourable – The majority of the community services are showing a breakeven position apart from the Ealing ICO/Brent Community Services which is £0.1m unfavourable as at month 3, due to non-achievement of Ealing ICO/BCS QIPP. COMMUNITY SERVICE VARIANCES – MONTH 3 26 26

  27. PRIMARY CARE VARIANCES – MONTH 3 • Prescribing (£0.1m) Favourable - Under spend relates to April 2011 GP prescribing. • Primary Medical Service(£0.1m)Favourable - due to reduction in the contract value with Out of Hours providers. In 2011, more practices have opted to provide out of hours hence reducing the SLA with OOH providers. • Dental Contract (£0.05m) Favourable – due to the claw back for non achievement of dental targets for 10/11. • Pharmacy Contract Breakeven– Break even to budget at month 3 • Ophthalmic Contract (£0.01m) Un Favourable – Based upon month 2 activity. 27 27

  28. CORPORATE COSTS VARIANCES - MONTH 3 • In total Corporate Services (£0.2m) Favourable – this variance reflects the vacancies within the structure and underspends on the non-pay budgets which relate to budget phasing. 28 28

  29. PUBLIC HEALTH VARIANCES – MONTH 3 ESTATES VARIANCES - MONTH 3 • Estates (£0.02m) Unfavourable - small overspends across a number of the sites offset by staffing vacancies. • Public Health Services (£0.09m) Unfavourable – majority of the public health services are breakeven as at month 3, except for £0.07m overspend due to increased HIV related activity and £0.02m over-performance on children and families budget. 29 29

  30. BALANCE SHEET AT 30TH JUNE 30

  31. DEBTORS ANALYSIS 31

  32. BETTER PAYMENT PRACTICE CODE (BPPC) The PSPP target is being achieved in 3 out of 4 categories. The BCS figures relate to invoices processed in 11/12 relating to the 10/11 financial year. 32

  33. QIPP PROGRAMME SUMMARY • . Data is not yet available on performance on all QIPP schemes, this mainly relates to contract terms items where data is awaited from the ACV . Where data is not available, performance is assumed to be on plan. • Total budget variance is split by QIPP/non-QIPP as follows: • . The following slides provide a scheme-by-scheme analysis of the QIPP programme • The main areas of forecast underachievement are: • Primary Care Contract Management • GP Prescribing • Community services contract • STARRS • In each of the above areas, a recovery plan is being developed/implemented • The underachievement is offset by over-achievement on other schemes, mainly on out of sector contracts. 33 33

  34. QIPP PROGRAMME (1) 34 34

  35. QIPP PROGRAMME (2) 35 35

  36. SECTION 3 - FORECAST OUTTURN 36

  37. SUMMARY OF FORECAST OUTTURN VARIANCES Explanations for the main variances are included on the following slide.

  38. SUMMARY OF FOT VARIANCES (1) Acute Commissioning breakeven – The FOT position is shown as breakeven after offsetting acute reserves against overspends. Other Acute Commissioning breakeven – The FOT position is shown as breakeven due to the lack of information available at M3 (e.g. incomplete NCA data etc). Joint Working Commissioning(£0.5m) favourable – The FOT variance includes (£0.2m) favourable position for Continuing Care Children due to expected closed cases, Children and Families (£0.1m) due low activities in cost per case, Continuing care Adults (£0.1m) due mainly to low uptake in Free Nursing Care and End of Life care (£0.1m) due to low activities. Community Commissioning (£0.4m) unfavourable - The FOT likely position for the community services is £0.4m unfavourable, and this variance is due to the Ealing ICO/Brent Community Services QIPP. Prescribing (0.2m) Unfavourable - Forecasted unfavourable variance of 2k due to QIPP savings targets for GP prescribing forecasted not to achieve. 38

  39. SUMMARY OF FOT VARIANCES (2) Primary Medical Service– Breakeven – Adverse QIPP variance of £0.1m is offset by reduction in the payment for Out of Hours SLA. Dental Contract - (0.1m) Favourable - due to the claw back for non achievement of dental targets for 10/11. Pharmacy Contract Breakeven Forecasted to break even to budget as the actual expenditure information for 11/12 is not available yet. Ophthalmic Contract Breakeven Forecasted to break even to budget at month 2 actual activity. Estates - Breakeven - The FOT expenditure is forecast at break even. Corporate Costs - Breakeven -The FOT expenditure is forecast at break even. Public Health (£0.1m) favourable - The FOT for Public Health is £0.1m favourable and this is due to the Chlamydia expected underperformance. Reserves/Investments (£0.02m) favourable – A small element of the reserves has been released in order to balance to forecast outturn position overall. 39 39

  40. RISKS/OPPORTUNITIES SUMMARY Based upon the above analysis a breakeven outturn against plan is also the worst case. The potential best case reflects the non-utilisation of the risk reserve for Harrow plus any further underspends on budgets and reserves. 40 40 40 40

  41. APPENDIX A – FINANCIAL SCHEDULES 41

  42. NHS BRENT SUMMARY - MONTH 3 42

  43. ACUTE - MONTH 3 43

  44. JOINT WORKING - MONTH 3 44

  45. PRIMARY CARE - MONTH 3 45

  46. PRESCRIBING – MONTH 3 46

  47. COMMUNITY SERVICES - MONTH 3 47

  48. PUBLIC HEALTH – MONTH 3 48

  49. ESTATES – MONTH 3 49

  50. CORPORATE – MONTH 3 50

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