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Long read

What is commissioning and how is it changing?

This explainer was originally written by Lillie Wenzel and published on 18 September 2017. It was updated by Ruth Robertson on 19 September 2019 and by Charlotte Wickens on 20 July 2023. This explainer describes the structure of the commissioning system after July 2022, when integrated care boards become the statutory commissioners of the majority of NHS care.

Commissioning is the process by which health and care services are planned, purchased and monitored. Here we look at the commissioning process in more detail, the organisations involved and how it is changing.

What is commissioning?

Commissioning comprises a range of activities, including:

  • assessing needs

  • setting priorities

  • planning services

  • procuring services

  • monitoring quality.

This ongoing process is often shown as a cycle1:

A graphic of the commissioning cycle, with patients/the public in the centre.

The concept of commissioning was introduced into the NHS in the early 1990s, when reforms separated the purchasing of services from their delivery, creating an ‘internal market’. It was argued that making providers compete for resources would encourage greater efficiency, responsiveness, and innovation. Similarly, the 1990 Community Care Act significantly changed social care commissioning giving responsibility to local authorities to commission and manage adult social care. Responsibility for commissioning many public health services passed to local authorities in 2013.

Commissioning arrangements have evolved since their introduction, including through numerous changes to the structure and remit of the organisations that commission care. The underlying philosophy of commissioning has also changed over time with a move away from transactional models and towards greater partnership working. These changes are intended to support the development of more integrated care, where services are better co-ordinated across the NHS and social care; and an increasingly population health-based approach, which considers how best to use local resources to address the full range of factors that contribute to health.

Who is responsible for commissioning?

The current system is based on arrangements set out in the Health and Care Act 2022, which entailed significant structural change for commissioning at both a local and national level.

Local commissioning

Integrated care systems (ICSs)

There are 42 statutory ICSs across England, and they are made up of two key parts – an integrated care partnership (ICP) and an integrated care board (ICB). These two parts play different roles when it comes to commissioning and planning.

The ICP is a statutory committee bringing together a broad set of system partners (including local government, the voluntary, community and social enterprise (VCSE) sector, NHS organisations and others) to develop a health and care strategy for the area. The integrated care strategy is a plan to address the wider health care, public health and social care needs of the local population. This strategy should build on local joint strategic needs assessments and health and wellbeing strategies and must be developed with the involvement of local communities and Healthwatch.

The ICB must have regard to its partner ICP’s integrated care strategy in carrying out its work as these strategies are intended to set the conditions for the statutory commissioners of the NHS, social care and public health.

ICBs have taken over the statutory responsibility for commissioning most NHS services previously held by clinical commissioning groups (CCGs) but are also taking on some of the direct commissioning functions of NHS England (see below). The majority of NHS England’s budget is allocated to ICBs which commission services for their populations. The ICB with its partner NHS trusts and foundation trusts is responsible for producing a five-year plan for how NHS services will be delivered to meet local needs.

The ICB is directly accountable to NHS England for NHS spend and performance within the system. ICBs may choose to exercise their functions through delegating them to more local place-based partnerships but the ICB remains formally accountable.

The way in which ICBs work, and their relationship with providers and local authorities, is intended to be different to their predecessors, CCGs. For providers, this new way of working will be facilitated by a new provider selection regime, which allows a more collaborative approach. The involvement of local government has been formalised through the ICP and through local authorities nominating at least one member of the board of the ICB. This recognises that commissioners and system partners will need to work together if they are to make progress in improving population health and tackling inequalities in their local areas. This has been clearly set out in the new Triple Aim, a legal duty on NHS bodies that requires them to consider the effects of their decisions on:

  • the health and wellbeing of the people of England (including inequalities in that health and wellbeing)

  • the quality of services provided or arranged by both themselves and other relevant bodies (including inequalities in benefits from those services)

  • the sustainable and efficient use of resources by both themselves and other relevant bodies.

Local authorities

Local authorities are responsible for commissioning publicly funded social care services. This includes services provided to people in their own homes as well as residential care services.

Since 2013, local authorities have also been responsible for commissioning many public health services including sexual health services, health visitors, school nursing and addiction services (as mentioned below, some public health services are commissioned by NHS England). Funding allocated to local authorities for public health services is provided via a grant from central government and this is ring-fenced (ie, cannot be used for other purposes). As of June 2023, the government was yet to decide whether the grant will continue to be ring-fenced in future years.

Commissioning at place level or by place-based partnerships

ICS policy is based on a principle of subsidiarity that holds that much of the activity to integrate care, improve population health and tackle inequalities will be driven by commissioners and providers collaborating over smaller geographies (often referred to as ‘places’) within ICSs and through teams delivering services working together on even smaller footprints (usually referred to as ‘neighbourhoods’). Therefore, ICBs are expected to delegate significant responsibilities, including commissioning, and budgets to place-based partnerships, as stressed by the government’s integration White Paper and the guidance document Thriving places.

Place-based partnerships typically involve the NHS, local government and other local organisations with responsibilities for planning and delivering services, such as VCSE organisations and social care providers. Place-based partnerships aim to shape how a broader set of resources are used to improve health and wellbeing. A key function is to look across the range of resources available in the NHS, local authorities and elsewhere – including budgets, staff, data and estates – in order to improve how these are used to meet local needs. The ethos of ‘one place, one budget’ is more advanced in some areas than others but has become a key aspiration in many places, and the government has indicated that it would like to support local partnerships to go further in terms of pooling local authority and NHS budgets through ‘section 75 arrangements and the Better Care Fund.

The Health and Care Act 2022 enabled the delegation of commissioning to place level. This allows for the formation of place-based committees but left flexibility for local areas to determine how these should be formed and how they will operate. These place-based committees can be, and are often developing as, committees of the ICB.

National commissioning bodies and support functions

NHS England

As well as providing strategic oversight for the NHS, NHS England is responsible for directly commissioning some services. These include specialised services, such as neonatal services and treatments for rare cancers – although increasingly these responsibilities are being shared with ICBs (see below). NHS England also commissions some public health services known as Section 7A services, such as immunisation and screening programmes, as well as health care for people in prisons and secure units, and some services for the armed forces.

Most of NHS England’s commissioning function is delivered through seven regional teams. As well as commissioning services directly, NHS England is responsible for assuring the quality of ICBs’ commissioning through an annual assessment process. This assurance role will be enhanced following the delegation of primary care, pharmaceutical, general ophthalmic and dental (POD) services to ICBs through the primary care commissioning assurance framework.

Commissioning support organisations

Commissioning support units (CSUs) provide support for commissioning activities for a range of organisations including ICSs, local authorities and hospitals as well as NHS England. However, the use of CSUs varies between different areas. Following a number of mergers, there are now four CSUs in England. CSUs receive much of their income from ICB running-cost allocations and NHS England, so they must be responsive to the needs of their local health system as well as delivering against national priorities. The offer from CSUs to systems includes a range of support services that benefit from at-scale working or where skills are still developing in ICBs, for example, analytical and transformation support and supporting their back-office functions by providing ICT services.

How is commissioning changing?

These changes are all part of enabling a shift towards strategic commissioning and a more collaborative approach to planning and improving services. This means that, instead of focusing on procurement and contract management, the role of commissioners is to work closely with key partners across the system (including providers) to understand population needs, determine key priorities and design, plan and resource services to meet those needs.

In the sections below we explore some of the developments that are happening to facilitate these changes.


The Health and Care Act 2022 allowed the delegation of NHS England’s national commissioning responsibilities to ICSs with the benefits of this seen as giving them the flexibility to join up key pathways of care, leading to better outcomes and experiences for patients, and less bureaucracy and duplication.

Primary care, pharmaceutical, general ophthalmic and dental (POD) services

While ICBs have already assumed responsibility for primary medical services (because these were responsibilities already held by CCGs), there has been further delegation of primary care, pharmaceutical, general ophthalmic and dental (POD) services. To support this, particularly in terms of needed expertise and capacity which does not already exist in many ICBs, NHS regional teams are going to transfer staff working on POD commissioning to ICBs. ICB running costs are also being adjusted to include the full pay and non-pay budgets for POD services and staff. NHS England is also in the process of preparing a toolkit to support the people commissioning POD services within ICBs.

The evaluation of nine early adopter ICBs which took on POD services ahead of the April 2023 deadline has demonstrated that this is a significant step forward to address local provision challenges, particularly around dentistry, and it further alters the commissioner-provider relationship from a transactional model to a deeper relationship. However, the POD functions are all bound by specific national contracts or contractual frameworks which could present challenges to the more flexible approach commissioning that ICBs are looking to develop.

Specialised commissioning

Since 2013 NHS England has been the accountable commissioner for a diverse portfolio of 154 specialised services, with an overall budget of around £23 billion in 2022/23. However, since 2018 NHS England has been working to develop more integrated commissioning of specialised services with local commissioners with the intention of maximising the opportunities to join up pathways and deliver high-quality care.

NHS England has set out plans to delegate the responsibility for some of these services to ICBs under a phased approach. This means that suitable services – around 65 out of 154 services – would be devolved to most ICSs. These include, for example, services for major trauma, congenital heart disease, and radiotherapy. All services will continue to have national standards attached to them and NHS England will continue to be the accountable commissioner for all specialised services and so will need to ensure the right mechanisms are in place to ensure ICBs are carrying out commissioning responsibilities appropriately.

The delegation of specialised services budgets to ICSs has been delayed by a year to April 2024 in all areas. To prepare ICSs for taking on this function, ICSs and NHS England will develop nine joint committees in 2023/24. These nine regional committees will be multi-ICS collaborations that bring together the ICSs in an area based on patient flow.

Further delegation

NHS England has also signalled that it may also look to include Section 7A public health functions, which includes both cancer and non-cancer screening and immunisations, in delegation arrangements with ICBs at a later time. However, there is complexity to these Section 7A pathways and so further work will be needed to enable this to happen.

Provider collaboratives

While distinct commissioning and provision responsibilities still formally sit in separate organisations, in practice the division is becoming increasingly blurred in a number of ways. One of these is through the ICB, on which NHS trusts, foundation trusts and GPs can sit as members. Providers are also forming provider collaboratives, partnerships that bring together two or more NHS trusts to work together at scale to benefit their populations.

In the future, provider collaboratives may take on additional responsibilities from the commissioner, such as designing new models of care. This is intended to support the desired shift from a transactional approach to planning services towards organisations working together to do this. Provider collaboratives are intended to work with the other parties in the ICSs to determine how best the collaborative can contribute to the delivery of shared priorities. They are also expected to contribute to place-based partnerships.


Whatever changes happen to the functions currently referred to as commissioning over the next few years, most of the key tasks involved (which are often summarised in the commissioning cycle) will continue. Commissioning arrangements and responsibilities are regularly shifting and can be complex. It may be that in the future, providers, provider collaboratives and places start to take on some of these activities or that the way some activities are done may change but every health system needs to assess local needs and then plan, develop and monitor services.

The terminology we use to describe this may change but whether or not we call it commissioning, strategic commissioning or population health management it is important to recognise that the services people access don’t spring into being without the work to plan, design and resource them – so the work of commissioning is, and will remain, vital.

As such, commissioning still has a central place in the health and care system, albeit with a very different ethos behind it than the one originally envisaged by the ‘internal market’.