NHS England has been downsized and abolished. Integrated care boards have been told to change function, consolidate, and deliver savings. Trusts are planning big cuts. The Highland Marketing advisory board met to consider the impact on health tech, and how suppliers can navigate the chaos.
During the general election campaign, Labour said “another top-down reorganisation of the NHS” was “the last thing” it wanted. Yet, less than a year after the general election, one is underway anyway, triggered by the decision to abolish NHS England, impose cuts on integrated care boards, and require trusts to cut non-clinical staff numbers.
The combination of reorganisation and cuts is likely to have a significant impact on NHS IT, as national programmes are moved or stopped, and ICB and trust priorities change. At a recent meeting, the Highland Marketing advisory board shared some early thoughts on the likely impact…
NHS England: cut in half and then abolished
What is happening? As soon as Labour came to power, responsibility for the policy and reform agenda started to shift toward the Department of Health and Social Care, where the team developing the 10 Year Health Plan is based.
In February, NHS England chief executive Amanda Pritchard announced a “brutal restructuring” of NHS England, before standing down herself. Just a few days later, Prime Minister Sir Keir Starmer announced “the world’s largest quango’ would be abolished entirely.
In a follow-up statement, health and social care secretary Wes Streeting gave two reasons for the move. First, NHS England has failed. The NHS is spending more money and has more staff than it did when Labour left power in 2010, he argued, but it is delivering worse outcomes and lower patient satisfaction.
Second, the Department of Health and Social Care and NHS England are “two large organisations doing the same roles” and “when money is tight, such bloated and inefficient bureaucracy cannot be justified.” Transition chief executive Sir Jim Mackey wants the reorganisation to be complete within two-years.
Highland Marketing advisory board discussion: Highland Marketing advisory board members were shocked by the way the abolition of NHS England had been handled. “The way it was announced was diabolical,” said Ian Hogan, a trust chief information officer. “You have to feel for the way many staff found out” (which was often through the media).
Looking at the longer term, our experts were concerned that the changes have announced ahead of the 10 Year Health Plan. When, logically, a restructure might have been expected after the plan and delivered as part of the workforce and digital strategies that will be needed to flesh out its ideas.
“What was needed was reform, not a restructure,” said entrepreneur Ravi Kumar, “and nobody can see a reform agenda in what is happening.” This, he argued, is bad news for staff and patients, who will need to be onside with any changes proposed.
Nor does it help the suppliers that will be needed to deliver the government’s shift from ‘analogue to digital’ and enthusiasm for AI. “The government needs to give a strong steer to the private sector about where to invest, and that is not coming across,” Ravi Kumar said. “At the moment, all we are seeing is chaos.”
One aspect of the chaos is the lack of clarity about what will happen to NHS England’s digital responsibilities and programmes. Until 2019, most aspects of NHS IT sat with an arms-length body, NHS Digital. Then former health secretary Matt Hancock set up NHSX as joint unit with the DHSC.
Then NHSX was abolished, and NHS Digital became part of NHS England’s transformation unit. Now, it will probably transfer to the DHSC in some form. Although there are other options. Neil Perry, a former trust CIO who now works as a consultant, pointed out that the Government Digital Service has been revamped.
“That could be an opportunity to align the NHS with other developments across government, and to get all the government digital services moving in the same direction,” he argued. David Hancock, a former supplier exec and interoperability expert, agreed; although he also felt the government is “making it up as they go along” and being driven more by finance and headlines than strategic planning.
The centralisation of NHS IT, wherever it ends up in Whitehall, could have benefits for suppliers. James Norman, a former trust CIO who now works on the supplier side, argued it could disrupt existing relationships and create room for new ideas.
“There is an opportunity to put a system in place to open up information [about strategies and procurements] and to operate in a more open and collaborative manner,” he said. Although there’s also a risk that the large, often US, tech firms that can afford to employ lobbyists and sponsor the kind of think-tanks that generate ‘big ideas’ for ministers will become even more dominant.
Integrated care boards: cuts push consolidation
What’s happening? The abolition of NHS England overshadowed an equally seismic shift in the set-up of the NHS; namely, an overhaul of the functions of integrated care boards, coupled with cuts to their operating costs of 50%.
On his first day back at NHS England, Sir Jim Mackey wrote to system leaders to say ICBs should focus on ‘strategic commissioning’ and population health management, with other functions moving to the centre or providers.
The idea could be to refocus ICBs on their original remit, which was to join up services and drive prevention. Which would put them in a stronger position to deliver the 10 Year Health Plan. However, ICBs will be bigger but weaker and more limited organisations in future.
So, the impact could be to shift the integration and transformation agenda towards providers (creating ‘accountable care organisations’ in the US terminology). Whatever the outcome, cost reduction plans must be in place by October.
Advisory board discussion: Highland Marketing advisory board members were surprised at the scale of the changes to integrated care boards, and the speed at which the conversation had moved from cuts, to consolidation, to a target of just 23-28 ICBs across the country.
They were also surprised at the scale of the reduction in ICB responsibilities set out in NHS England’s ‘model ICB’ blueprint. This indicates that more than a dozen functions will ‘transfer’ to the regional bodies, trusts, or ‘neighbourhood health providers’ – new bodies recommended in the ‘Fuller Stocktake’ that are forming around primary care networks, but don’t really exist yet.
Cindy Fedell, a former trust CIO who now works in Canada, said she was concerned about the focus on savings and reorganisation when policy and structure is still in flux.
“I am really worried about place,” she said, “because ICBs are getting bigger while the neighbourhood idea is still being worked out. We know that a population of around 50,000 (like Bradford, where she used to work) is where you can really make a difference.”
Nicola Haywood-Cleverly, a former trust CIO who works as a non-executive director, also argued there is a danger of a gap opening-up between policy at a national level and delivery on the ground.
“Unless we give leadership to neighbourhood partnerships and direct them to work collaboratively to serve the whole person, families and local communities, there is a risk that we will continue to offer poor and fragmented services to citizens,” she said.
In IT terms, the model ICB document says that responsibility for data will move to a new national body; but ICBs will still be expected to carry out analysis for population health management. Digital leadership and transformation will shift back to providers.
It is less clear what will happen to the primary care IT support that ICBs inherited from their predecessor bodies. The model just says that options will be considered to create a “consistent offer” for GPs. CIOs contacted by digitalhealth.net felt that shifting responsibility for digital to trusts is a backward step.
They argued it will reduce opportunities to secure economies of scale in big IT procurements and reduce the incentive for trusts to pick common or even interoperable systems. However, Neil Perry pointed out the way in which ICBs approach IT is very variable, currently.
While some have IT leads on their boards, most don’t or lean on the CIO at their largest trust. Similarly, only a handful have managed to ‘converge’ local EPR systems, mature their shared care records, or build their own analytics capacity.
So, the model may just be providing useful clarity. “If suppliers were asking me what to do, I would say build a partnership with providers,” he said, “and that is always the case.
NHS trusts: cuts drive job losses
What is happening? Trusts have also been told to deliver significant cash improvement programmes, close a projected £7 billion deficit, and reduce their “corporate cost growth” – or the additional amount they have been spending on corporate functions since the year before the pandemic – by 50% this year.
Sir Jim has suggested trusts should look at transferring staff to wholly owned subsidiary companies, which get favourable VAT treatment. But the first response of most providers has been to look for job losses.
The NHS Confederation has estimated that trusts could have to shed between 3% and 11% of their workforce; or 40,000 to 150,000 people. NHS Providers has predicted there will still be longer waiting lists and cuts to services, with maternity, palliative care, prevention, and virtual wards in the firing line.
Advisory board discussion: The advisory board felt the cuts that are being made at trusts are symptomatic of the general rush to cut costs before bigger policy and structural issues have been thought through.
David Hancock argued that the 10 Year Health Plan is likely to require more digital, data, and analytics expertise, not less. “The government wants to see a shift from analogue to digital, but that’s not just about buying devices or software,” he said.
“You need implementation capacity, and to be able to optimise and maintain systems.” Similarly, he noted, the government wants to see the rapid take-up of AI and has just put out guidance on the use of ambient listening technology.
That is likely to reduce administrative jobs and tasks: “but we’ll need more IT people.” The model ICB document also assumes that providers can pick up digital leadership and transformation, while reducing headcount. Which Ian Hogan said is not realistic.
“There has been growth in my department, but it has not been ‘unwarranted’,” he said. “We haven’t randomly decided to grow something like cyber security. But from a financial perspective it’s difficult to justify, because the benefit isn’t seen by us, but by the clinical teams, which are protected (even though there has been considerable growth in clinical staff numbers).”
Speed is making a challenging environment even more challenging, he added. “NHS England is wanting to make savings in-year and they are asking for a plan to do it by the end of May,” he said. “But from a digital perspective, there is no low-hanging fruit left.”
The advisory board warned that amid the uncertainty, a lot of experienced people are likely to leave, taking their organisational memory and contacts with them. Trusts may need to look at bringing in consultants and service companies to plug gaps.
James Norman argued this could be a benefit to trusts, if third-parties bring new approaches, partners, and ideas with them. However, this is unlikely to be cheap. Also, it’s not clear that this is what the government wants to happen.
“Everybody is focused on the £7 billion deficit that trusts are looking at this year,” said Nicola Haywood-Cleverly. “But all they have done is chunk it up for each organisation and tell them to focus on headcount reduction. That’s going to have all sorts of consequences, and more of it needs to be thought through at a national level.”
