Are independent commissioning support services the right way to go?

14 June 2012

The lines on the map are gradually snapping into place. The NHS Commissioning Board has announced the full list of clinical commissioning groups (CCGs) seeking authorisation. There are 212 in all, covering populations of between 68,000 and almost a million. These are not the commissioning groups most people imagined back in 2010 – they are far fewer and, on average, far larger.

The future shape of support arrangements for CCGs is also slowly becoming clearer. Last month we learnt which of the commissioning support services (CSSs) currently being moulded from the embattled primary care trust (PCT) workforce succeeded in passing through the Commissioning Board’s second ‘checkpoint’. Three of the applications were stopped dead in their tracks, with another nine identified as needing further development. Twenty three will go through to the final checkpoint in August.

Once approved, CSSs will be ‘hosted’ by the Commissioning Board until 2016. As such, their staff will be employees of the Commissioning Board and will benefit from some security over the transitional years, while CCGs develop as organisations and as customers of commissioning support. But the intention is that by 2016 the hosting period will end, and CSSs will need to fend for themselves as free-standing organisations.

These arrangements were conceived as a way of reconciling the political aspiration for a self-sustaining market in commissioning support with the short-term need to keep control of redundancy costs and limit the loss of commissioning talent from the NHS. The idea is that the shift will force CSS staff to see CCGs as their customers rather than as the next rung down in the NHS management hierarchy. But the intention to move statutory provision of commissioning support into the independent sector has raised a number of concerns.

First, there is the important issue of cost. Commissioning support is big business – a recent survey of CCGs indicates that hosted CSSs will initially have a combined income of around £600 million per year. Establishing CSSs as independent bodies is likely to increase procurement costs for CCGs. Whether these costs will be outweighed by the theoretical gains obtained from creating a more competitive market for commissioning support is an open question.

Second, there are concerns about accountability. CCGs will not be legally entitled to transfer their core statutory duties to CSSs. But will they be strong enough to hold them to account effectively? While the governance requirements for CCGs have become more detailed and demanding as a result of amendments made during the parliamentary passage of the Health and Social Care Bill, the hand-off between CCGs and commissioning support organisations remains a potential blind spot. Requirements created for CCGs - for example, to meet in public - will not apply to CSSs.

A further issue that could arise post-2016 has been raised by legal experts. Some lawyers have suggested that the hosting arrangements could constitute illegal state aid. In this scenario, fully-fledged CSSs could find themselves open to legal challenge shortly after leaving the Commissioning Board nest, with existing independent sector providers arguing that the hosting period gave new entrants from the statutory sector an unfair competitive advantage.

There is a wealth of commissioning talent spread across various settings – the NHS, local authorities, the voluntary sector and private companies. It is right that CCGs should be able to access the support they need from whichever providers they see fit. But the government’s proposals go beyond the creation of a level playing field for commissioning support, and express a prior preference for outsourcing and minimal ongoing statutory provision. The justification for this is not immediately apparent.

What is clear is that if the new commissioning system is going to succeed, getting support arrangements right will be absolutely critical. Our previous research has highlighted the challenges involved in achieving this. Commissioning has often been described as the ‘weak link’ in the NHS. Without the right approach to commissioning support there is a significant risk that the new system will be no more effective in addressing this than the old one.

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