Key points
- The purpose of commissioning is to drive service improvements. The commissioning cycle incorporates:
- needs assessment
- reviews of services provided
- priority setting and planning
- contracting
- service development
- and performance management.
- Commissioning is the primary function of primary care trusts (PCTs) in England. PCTs are responsible for just over 80 per cent of the total NHS budget – approximately £85 billion – and commission services from a range of NHS, private and voluntary sector providers.
- The amount allocated to each PCT varies according to a complex ‘weighted capitation’ formula designed to link budgets to local needs (for example, Manchester gets more than twice as much per head of population than Oxford).
- PCTs are expected to work within this cash limit. Recent changes to the budget allocation formula have led to ‘winners’ and ‘losers’, with some PCTs facing potential disruption to services as a result of cutbacks.
- The evolution of commissioning in the NHS began when the ‘internal market’ was introduced in 1991. Two models of purchasing developed: health authorities, centred on the health needs of the population; and fundholding, where GPs in individual practices or consortia could purchase elective care for patients.
- In 1997, GP fundholding and its variants were abolished in favour of primary care groups and trusts (PCGs and PCTs). An extensive period of reform and organisational upheaval, including the phasing out of health authorities in 2002, has led to the current situation where there are 152 PCTs in England.
- In 2005, practice-based commissioning (PBC) encouraged ‘virtual’ budgets to be placed in the hands of GP practices to make commissioning decisions in partnership with PCTs. However, only very modest progress had been achieved to date.
- In 2007, world class commissioning (WCC) was developed as a way of bringing a ‘step change’ in the commissioning capacity and capability of PCTs and practice-based commissioners. The WCC programme has set out a range of core competencies that PCTs need to achieve, alongside an assurance framework that measures, supports and holds PCTs to account.
- Commissioning continues to evolve with innovations such as the annual Quality Account and Commissioning for Quality and Innovation (CQUIN) payment, which links quality with payment. Integrated care organisations (that potentially commission and provide care) are being piloted, as are personal health budgets. The health and well-being agenda has also encouraged the pooling of health and social care commissioning budgets.
