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Finance Report Month 5 2012-13 draft v0.1

Finance Report Month 5 2012-13 draft v0.1. Jonathan Wise, Director of Finance & Performance. NHS BRENT FINANCE REPORT 12/13 - CONTENTS. Summary [Slides 3-9] M5 Position [Slides 10-38] Forecast outturn position [slides 39-42] Appendices Detailed finance schedules [Slides 43-49].

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Finance Report Month 5 2012-13 draft v0.1

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  1. Finance ReportMonth 5 2012-13draft v0.1 Jonathan Wise, Director of Finance & Performance

  2. NHS BRENT FINANCE REPORT 12/13 - CONTENTS • Summary [Slides 3-9] • M5 Position [Slides 10-38] • Forecast outturn position [slides 39-42] • Appendices • Detailed finance schedules [Slides 43-49]

  3. SECTION 1 – SUMMARY

  4. EXECUTIVE SUMMARY • Month 5 • Budgets have been updated to reflect allocation and contract changes and investment plans (see slide 11). The final position on a number of out of Cluster acute contracts has been clarified, specifically on UCLH and Royal Free, resulting in a £1.8m reduction. In addition the investment plan has reduced by £0.2m. This has resulted in an additional £2m transferring into general reserves. • Key acute contracts (NWLH/EHT/Imperial) are ‘blocked’ for 12/13, reducing the in-year risk. • A balance of £8.7m for new investment is awaiting approval of business cases (see slide 8). • QIPP schemes show a £0.7m (14%) adverse variance against budget, mainly as targets on urgent care and reducing non elective admissions are not being fully achieved. • In acute contracts, there is over-performance of £5.9m (before caps) and £1.3m (after caps). • A cumulative surplus of £1.2m against plan is reported due to underspends in prescribing, joint working, public health offset by overspends in acute. The most significant underspent in-month was on prescribing (cumulative £1.3m compared to £0.2m in July). • Forecast Outturn • The acute contract position to month 5 projects to a year-end forecast overspend, taking activity trends into account, of £12.9m (before caps) and £5.2m (after caps). The capped position is reduced to a £3.6m overspend by utilising £1.1m in-year acute reserve and £0.4m underspend on independent sector providers. However, if activity continues at the current rate, there is likely to be a significant pressure in 2013/14. • The prescribing outturn based upon the PPA forecast using data April – June has increased significantly to £3.1m. However the PPA has since issued a warning about using this forecast. April – July data has not yet been made available. • An overall forecast outturn of break-even is reported assuming: • - investment plan spend profiles do not slip significantly • - QIPP schemes do not slip further than the forecast £0.9m (7%) adverse variance • In addition, there are uncommitted general reserves of £4.2m in-year (largely as a result of changes to contract values), contingency of £2.7m (representing the 0.5% all PCTs are advised to hold) plus acute in-year risk reserve of £3.2m. It is highly unlikely that all the reserve/contingency will be required and a review of the options for handling this potential further underspend of c£10m will be made during M6. There will also be a review of balances as part of the Q2 Agreement of Balances exercise, which may result in further flexibility as a result of successful challenges to 11/12 invoices.

  5. FINANCIAL PERFORMANCE SUMMARY (1) YTD FOT • PCT Statutory duties • Underspend against revenue resource limit • Achievement of capital resource limit • Achievement of cash limit • Underlying recurrent position (PCT) • Achievement of overall financial plan (PCT) • Achievement of public sector payment policy (PCT) • Achievement of 12/13 QIPP plan (PCT) • CCG Delegated Budgets* • CCG Delegated QIPP G G G G G G G G G G A A R R G G R R *after adjusting for contingency/reserves

  6. SUMMARY OF MONTH 5 AND FORECAST OUTTURN • The month 5 report includes performance against QIPP. The Month 5 and forecast outturn (FOT) variances have been analysed between CCG delegated budgets as below: • * QIPP variance relates to actual performance of schemes before impact of block contracts. The impact of the block contracts is included in the Non-QIPP column. The QIPP position is shown in detail on slides 33-37.

  7. UNDERLYING (RECURRENT) FINANCIAL POSITION • 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. The recurrent position is the key measure of future financial sustainability. • The August (M5) position, adjusted for the major one-off items, is set out below: • Note: • The M5 key data return includes 2% non-recurrent headroom (£10.9m), giving a recurrent surplus of £29.9m.

  8. INVESTMENT PROGRAMME BUDGETS PENDING APPROVAL • The following budgets included at Month 5 are subject to business case approval.

  9. PRACTICE LOCALITY BUDGETS IN 12/13 • M3 Reports are now available and have been distributed to Localities and can be accessed through the Portal.   • Locality Finance and Information groups are due to consider the latest Locality / Practice budget positions and to identify issues and develop plans in order to ensure their budget plans are delivered. • Practice budgets will be updated in M4 to reflect final agreed acute contracts and other in-year budget adjustments. • M4 Reports will be available towards the end of September.

  10. SECTION 2 – MONTH 5 POSITION

  11. OVERVIEW OF BUDGET POSITION AT MONTH 5

  12. SUMMARY OF YEAR TO DATE VARIANCES - MONTH 5 * QIPP variance relates to actual performance of schemes before impact of block contracts. Explanations for the main variances are included on the following slides.

  13. SUMMARY OF YEAR TO DATE VARIANCES (1) Acute Commissioning In Sector Contracts £0.4m unfavourable - currently 3 out of 7 NHS acute contracts are showing an overspend. The most significant over-performance is at Royal Brompton & Harefield of £0.3m. NWLHT, Imperial and Ealing are shown as breakeven due to the impact of the cap agreement. Out of Sector Contracts £1.2m unfavourable - currently 13 out of the 17 NHS acute contracts are showing overspends. Material variances are reported at Bart’s (£0.3m), Guys & St Thomas’ (£0.2m) and Other Trusts(£0.7m). The significant overspends in “Other Trusts” include Great Ormond Street (£0.3m), Barnet & Chase Farm (£0.3m) and Royal Free (£0.1m). Independent Sector Providers £0.2m favourable - this budget includes BMI, Spire and InHealth. The most material variances are underspends in BMI (£0.1m) and InHealth (£0.1m). Other Commissioning £0.1m favourable - these budgets includes London Specialist Commissioning Group (Acute), Other Specialist Commissioning for Acute, Cost per Case, High Cost Drugs and Non Contracted Activities. The most material underspend is NCAs/Acute Cost per Case (£0.2m) and the most material overspend is High Cost Drugs (£0.1m). Non Acute Joint Working Commissioning £0.5m favourable -the principal underspends at month 5 are on Children & Families services (£0.3m), IAPTs (£0.2m), Adult MH services - NCAs (£0.2m),and continuing care children (£0.2m). These underspends are due largely to less NCA and cost per case activity, delay in starting new investment in IAPT and more closed care packages in children continuing care group, due to transition to adulthood, and no new cases. The underspends are reduced to a large extent by an overspend of £0.4m in Adult continuing care service. The overspend is on mental health care, learning disability, older adult and palliative care groups. These are due to an increase in palliative care activity as a result of the fast track system being operated and target savings not yet achieved in the other three care groups. Community Services £0.2m unfavourable - Walk in Centres and Urgent Care Centres are overspent by £0.2m each due to higher activities and Community Business Cases is underspent by £0.2m as most of them have not yet started

  14. SUMMARY OF YEAR TO DATE VARIANCES (2) Prescribing £1.275m favourable - GP Prescribing variance for April to June is £1.275m favourable. July and August expenditure is accrued as per PPA expenditure profile. Primary Care £0.05m favourable - Medical contracts are under spending by £0.1m. Dental contracts are under spending by £0.24m due to higher than expected patient charge revenue collection and recovery of under performance for 11/12. Ophthalmic contracts are over spending by £0.14m. Pharmacy contracts are over spending by £0.13m for month 5 based on January to May expenditure trend. Other Primary Care is over spending by £0.01m due to expenditure on interpreting, parental leave payments and also due to GP suspensions. Estates £0.06m favourable - This includes the cost of all the sites including depreciation and the cost of capital. The Heights £0.025m, General Estates £0.025m, Sudbury £0.013m, and Chalkhill £0.023m are all underspent. Overspends reported in Hillside by £0.016m and Wembley Centre for Health and Care by £0.008m. Corporate Costs £0.3m favourable - This includes all the corporate cost centres and the recharge costs from the Cluster. There are over spends in Strategy and QIPP (£0.03m), Finance and Information (£0.04m) and the Borough Directorate (£0.3m) due to non-recurrent pay costs. There are underspends on Chief Executive (£0.08m), ICT (£0.3m), Prescribing-Brent (£0.05m), Continuing Healthcare (£0.07m), Family Health Services (£0.06m) Public Health Admin (£0.06m) , and Clinical Commissioning (£0.02m) largely due to pay underspends as a result of vacant posts. Public Health £0.5m favourable -This includes public health commissioned services including Sexual health, Drugs and Alcohol Treatment and Smoking Cessation. There are underspends across a number of cost centres including Sexual Health (£0.1m) , DAT (£0.02m), C&F Sexual Health (£0.03m), Smoking Cessation (£0.1m), Immunisation (£0.02m), Improving Breast Feeding (£0.06m), Breast Screening (£0.02m), Chlamydia screening (£0.02m), Improving Performance (£0.08m) and Health Checks (£0.02m). Contingency and Reserves : Breakeven - none of the contingency / reserve budget has been released at Month 5.

  15. ACUTE CONTRACTS MONTH 5 • Figures are based on Month 4 Trust reports as reported by the Acute Commissioning Vehicle (ACV) • Reported Trust figures exclude ACV Challenges which have not yet been incorporated or accepted by the Trusts and the impact of block contracts with NWLHT, Imperial and Ealing. • Out of Sector contracts – budgets reflects the latest position and advice from the ACV for contract values and Trust reported figures for actuals. • The year-to-date position excluding caps is £5.9m overspend, made up of £6.1m overspend in NHS Acute providers (shown on slide 18) and £0.2m underspend in Non-NHS Acute providers. • Forecast Outturn (FOT) position: The year-end estimated position including the effect of the block contracts agreed with NWLHT, Imperial and Ealing is an overspend of £5.2m on NHS Acute contracts. At present we are forecasting a year end underspend of £0.4m for independent sector contracts. After factoring in £4.3m of the acute contract in-year risk reserve the FOT position is an overspend of (£0.5m).

  16. ACUTE CONTRACT POSITION – MONTH 5 The Year to Date Analysis is based on Month 4 Performance Reports for each Trust forecasted to Month 5 on a straight line basis. The above does not include the effect of block agreements.

  17. ACUTE CONTRACT POSITION – MONTH 4 Analysis of (Over)/Under Performance by Point of Delivery (POD) (£’000) 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 4 Performance Reports for each Trust forecasted to Month 5 on a straight line basis. The above does not include the effect of block contract agreements. A commentary on material over performance at the month 4 position reported by Trusts is on the following slides.

  18. ACUTE CONTRACT POSITION – MONTH 4 – over performing providers (1/5) The following tables reflect the latest available contract data from Trusts which is Month 4

  19. ACUTE CONTRACT POSITION – MONTH 4– over performing providers (2/5)

  20. ACUTE CONTRACT POSITION – MONTH 4 – over performing providers (3/5)

  21. ACUTE CONTRACT POSITION – MONTH 4– over performing providers (4/5)

  22. ACUTE CONTRACT POSITION – MONTH 4– over performing providers (5/5)

  23. ACUTE CONTRACT POSITION - MONTH 5 • The following graphs compare monthly activity levels in 2012/13 with 2011/12 and 2010/11. There may be differences in the variances shown in slide 20 and the following slides due to: • Slide 20 is expressed in financial variances and the following slides are expressed in activity. • Activity slides do not 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. Accident and Emergency is also not reflected in the Acute Activity Analysis graphs. • The following slides show actual activity changes year on year: • outpatients 6.6% increase; • elective admissions increase of 7.9%; • non-elective admissions increase of 5.7%; • births increase of 1.1%.

  24. ACUTE ACTIVITY ANALYSIS (1) - OUTPATIENTS Against the comparative period of April - July 2011, there is an increase in activity of 6.6%.

  25. ACUTE ACTIVITY ANALYSIS (2) - ELECTIVE Against the comparative period of April - July 2011 2011/12, there is an increase in activity of 7.9%.

  26. ACUTE ACTIVITY ANALYSIS (3) – NON-ELECTIVE Against the comparative period of April - July 2011/12, there is an increase in activity of 5.7%.

  27. ACUTE ACTIVITY ANALYSIS (4) – BIRTHS Against the comparative period of April - July 2011/12, there is a increase in activity of 1.1%

  28. SPECIALIST COMMISSIONING – LSG REPORT M4 (1) • The LSG Report for Month 4 shows a year to date position of £1.0m underspend • The most significant overspend at Month 4 is SCBU (£0.1m) • The main areas of significant underspend at Month 4 are NICU £0.3m, Adult BMT £0.2m and Forensic MH – WLMHT £0.1m • The Forecast year end position at Month 4 after the impact of risk share agreements is (£37k) overspend • The detailed LSG report is available on the next slide

  29. SPECIALIST COMMISSIONING – LSG REPORT M4 (2)

  30. NON-ACUTE VARIANCES – MONTH 5 (1/2) Joint Working Commissioning is showing a £0.5m underspend in the following areas: IAPT £0.2m favourable - due to late start of new investment in the service. Other Adult Mental Health Services£0.2m favourable – due to lower activity levels in non contractual activities. Children & Families £0.3m favourable - due to lower activity levels in cost per case and minor budgets. Continuing Care Children £0.2m favourable – due to closed care packages. Continuing Care Adult £0.4m unfavourable – due to new high cost, patients in mental health, older adult, physical disability and palliative care groups. And more clients receiving fast-track palliative care. Community Services Community Services £0.2m unfavourable :– Walk in Centres and Urgent care centres- £0.2m overspend each due to higher activities levels. Community Business cases - £0.2m underspend due to late start.

  31. NON-ACUTE VARIANCES – MONTH 5 (2/2) PRIMARY CARE Prescribing £1.27m favourable – GP prescribing variance for April to June is £1.279m favourable. July and August expenditure is accrued as per PPA expenditure profile. Central Drugs over spend of £0.03m is offset by under spend in prescribing support budget. Primary Medical Service£0.1mfavourable – due to under spend from Out of Hours budget. Primary Care Other & Projects £0.01m unfavourable – due to higher expenditure on interpreting, parental leave payments and also on to GP suspension payments. Dental Contract £0.24m favourable – due to higher than expected patient charge revenue collection and recovery of under performance for 11/12. Pharmacy Contract £0.13m unfavourable – month 1& 2 expenditure received.. Expenditure for months 3, 4 & 5 are estimated on average expenditure for January to May 2012. Ophthalmic Contract £0.14m unfavourable – April to July activity was more than budgeted and August payments were estimated as per the trend for April to July expenditure.

  32. BALANCE SHEET AT 31 AUGUST

  33. BETTER PAYMENT PRACTICE CODE (BPPC) The Public Sector Prompt Payment target is being achieved in 2 out of 4 categories.

  34. M5 YTD QIPP VARIANCES (1) There is an adverse PbR Based M5 YTD variance of -£710k (-14%)

  35. M5 YTD QIPP VARIANCES (2)

  36. QIPP PROGRAMME (1)

  37. QIPP PROGRAMME (2)

  38. QIPP PROGRAMME (3)

  39. SECTION 4 - FORECAST OUTTURN

  40. SUMMARY OF FORECAST OUTTURN VARIANCES * QIPP variance relates to actual performance of schemes before impact of block contracts. The table shows variances against the planned £21.5m surplus. Explanations for the main variances are included on the following slide.

  41. SUMMARY OF FORECAST OUTTURN VARIANCES(1) Acute In Sector Contracts £1.1m unfavourable – this position includes the effect of the cap agreed with NWLHT, Imperial and Ealing. Out of Sector Contracts £4.1m unfavourable –including Whittington (£0.2m) Bart’s (£0.7m), Guys & St Thomas (£0.6m), Kings (£0.2m), Royal Marsden (0.3m) and Other Trusts (£2.4m0. The main overspending Trusts under Other Trusts are Barnet & Chase Farm (£0.8m), Royal Free (£0.7m) and GOSH (£0.9m). Independent Sector Providers £0.4m favourable – forecast underspend in BMI of £0.1m, Spire £0.1m and In Health of £0.2m. The total Acute SLA overspend has been netted off by releasing £4.3m acute in-year risk reserve to produce a forecast breakeven position. Other Acute Commissioning £0.3m unfavourable – the most significant overspends are in High Cost Drugs and NCAs. Non-Acute Joint Working Commissioning £0.1m favourable – this is due to combination of favourable variance of £0.3m in Children and families due to low activities and late start of some services; favourable variance of £0.7m in continuing care children as a result of existing children in the care group transition to adult service, fewer new patients and retrospective cost adjustment; favourable variance of £0.1m in Joint Finance due to slippage in rehab services cost per case and end of life business case; favourable variance of £0.2m in Mental Health specialist commissioned service. There is an unfavourable variance of £1.2m in adult continuing care due to new high cost patients and savings target not yet achieved. Community Services £0.4m unfavourable –favourable variance of £0.7m in Community Business Cases due to late start of projects; unfavourable variances of £0.6m in Walk in Centres due to high activity; Urgent Care Centres is forecasted for overspend of £0.4m due to increased activity; STARRS is forecasted to overspend by £0.1m due to salary costs. Prescribing £3.1m favourable – As per PPA data for June,GP Prescribing budget is expected to under spend by £3.1m by year end. Expected over spend in central drug budget will be offset by under spend in prescribing support budget. However the PPA has since issued a warning about using this forecast. April – July data has not yet been made available.

  42. SUMMARY OF FOT VARIANCES (2) Primary Medical Services £0.5m favourable - on the assumption that the cluster QIPP for contract management would be met, there is a predicted under spend of £0.2m from list reductions. There is also an expected under spend from the Out of Hours budget based on April to August expenditure trend and also under spend in premises budget due to closure of 2 practice premises. Dental Contract £0.5m favourable - due to higher than expected patient charge revenue collection and recovery of 11/12 under performance. Forecast variance also assumes that the funds for dental access investment of £1.6m will be utilised. Pharmacy Contract£0.25m unfavourable - based on January to May expenditure trends. Ophthalmic Contracts £0.17m unfavourable - based on April to July expenditure trend. Primary Care Other & Projects£0.02m unfavourable - over spend in parental leave payments and GP suspension will be off set by income collections from Walk in Centres bringing the adverse variance down to only £23k. Estates – Break even - the outturn is forecast at break even. Corporate Costs – Break even - this position is based on the assumption that the cost pressures will be resolved in year to give a breakeven position. Public Health – Break even - the outturn is forecast at break even. Contingency / Reserves – None of the contingency/reserves has been released into the forecast outturn position.

  43. APPENDIX A – FINANCIAL SCHEDULES

  44. NHS BRENT SUMMARY - MONTH 5

  45. ACUTE - MONTH 5

  46. NON-ACUTE & PRIMARY CARE - MONTH 5

  47. PUBLIC HEALTH - MONTH 5

  48. ESTATES & CORPORATE – MONTH 5

  49. CCG DELEGATED BUDGETS – MONTH 5 Reserves and contingencies are added on Summary Slide 45

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