Amending the 2012 Act: can it be done?

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The Prime Minister has once again opened the door to changes to the Health and Social Care Act 2012. The Act is widely seen as dysfunctional, getting in the way of the more integrated care that it in fact seeks to achieve.

The Act, however, is not easy to unpick, and the parliamentary arithmetic is such that the chances of fresh legislation look slim. This short piece identifies some of the main complaints about how the current law operates; outlines some of the implications should attempts be made to amend it; and asks how far progress could be made within the existing legislation. 

Introduction

For five years after the Health and Social Care Act became law in 2012 the door to any amendment was not merely closed but bolted shut. The passage of the Act had been sufficiently traumatic for both the government of the day and the National Health Service to believe they had had their fill of ‘top-down reorganisations’.

More recently, the door has twice swung marginally ajar. The first occasion was the Conservative manifesto for the 2017 election – an election that, ahead of polling day, the Conservatives were widely anticipated to win. 

The manifesto supported the plans set out in the NHS five year forward view (Forward View). Those plans argued for much more integrated care given the challenge of an ageing population that includes people with chronic conditions – often multiple chronic conditions – that are not susceptible to one-off ‘cures’.

According to the Forward View, the service needs to ‘radically transform how care is delivered outside hospitals’. It noted that ‘our traditional partitioning of health services – GPs, hospital outpatients, A&E departments, community nurses, emergency mental health care, out-of-hours units, ambulance services and so on – no longer makes much sense’ (NHS England et al 2014).

The 2017 Conservative manifesto supported that position, declaring that:

If the current legislative landscape is either slowing implementation or preventing clear national or local accountability, we will consult and make the necessary legislative changes. This includes the NHS’s own internal market, which can fail to act in the interests of patients and creates costly bureaucracy.

Theresa May’s loss of a majority in the election put paid to any legislative change. Since then, however, she has again opened the door to legislative amendments after announcing in June 2018 that NHS services are to receive a multi-year 3.4 per cent funding settlement.

On 18 June, the Prime Minister said

As our NHS evolves, and delivers more joined-up care across different services, we should make sure the regulatory framework keeps in step and does not become a barrier to progress.

So I think it is a problem that a typical NHS clinical commissioning group negotiates and monitors over 200 different legal contracts with other, different, parts of the NHS. It is too bureaucratic, inhibits joined-up care, and takes money and people away from the front line.

So where legislation is making it harder for professionals from different parts of the NHS and different local authorities to work together – we should be prepared to change it; where it is resulting in overly bureaucratic processes – we should be prepared to change it; and where it is making it harder to hold NHS leaders accountable for delivering better outcomes for people – we should be prepared to change it.
(May 2018)

Taken together, however, these statements read as something closer to a willingness to amend the Act rather than replace it entirely.

NHS England has subsequently been asked to produce a long-term plan for the service, currently due by the end of November. Simon Stevens, Chief Executive of NHS England, has said that the question will inevitably arise as to whether there are aspects of the current legislation that, if amended, ‘would accelerate our progress’. Once the plan is published, he said, the current intention is to produce ‘between November and Easter’ and ‘with colleagues across the NHS’ options for legislative change (Public Accounts Committee 2018). 

The purpose of this short piece is to start a conversation on what those options might be, to set out some of their implications, and to point out the barriers to legislative change. It very much does not, at this stage, present a view from The King’s Fund on what should change.

What problems do people think need fixing?

The 2012 Act is widely seen as dysfunctional. It sought to set ‘choice and competition’ in legislative stone, operating through the purchaser–provider split not just as a way of managing the service, but as the way of running it (Timmins 2018). However, and partly as the result of amendments forced on the government during the passage of the Bill, the 2012 Act also lays duties on Monitor (now part of NHS Improvement), on the NHS Commissioning Board (now NHS England), and on clinical commissioning groups (CCGs) to provide services in ‘an integrated way’. Many (though not all) see these twin duties as being in conflict – using competition as a key tool to drive change at the same time as seeking to integrate services better.

What is certain is that from the moment the Act became law, through the Forward View and onwards, the emphasis has been on better integrated services. The following factors have come to be seen as barriers to achieving that.

The reinforcement, from top to bottom, of the purchaser–provider split

The division at the top of the service between the commissioning side (NHS England) and the provider side (NHS Improvement) is viewed as a key obstacle.

Over-regulation and assurance

Combined with the limited growth in NHS expenditure over recent years, providers in particular have complained about conflicting, indeed irreconcilable, instructions and messages from different parts of the regulatory structure. NHS trusts have found themselves encouraged by NHS Improvement to increase activity in order to balance their books at the same time as they are being asked to help commissioners restrict unnecessary admissions, diverting them to better settings. That is driven by the need for CCGs to balance their own books while implementing the broader policy of better integrated care. Achieving this can involve not just moving some services outside hospital but rationalising others within the hospital sector.

Combined with the limited growth in NHS expenditure over recent years, providers in particular have complained about conflicting, indeed irreconcilable, instructions and messages from different parts of the regulatory structure.

NHS providers may agree that elements of their service would be better provided elsewhere to create a more integrated service. However, if doing so would undermine their finances, they still face requirements from NHS Improvement to balance their individual books. NHS England’s view may be that so long as the local system balances overall, this does not matter. But NHS executives and non-executives on NHS boards alike worry that they have a duty to seek to balance their finances. They may wish to do the right thing but fear that they will be held accountable if that leads to deficits in their own organisations.

On top of the regulatory issue there is also a much broader one around ‘assurance’. Providers face burdensome information demands from CCGs, commissioning support units, urgent care networks, local accident and emergency delivery boards and various other administrative arrangements, some of which have been put in place to monitor and tackle waiting time targets. They also have information demands from the Care Quality Commission (CQC), the inspector and regulator of quality and safety, and those of Healthwatch, health and wellbeing boards and local authority scrutiny committees.

Procurement rules

There is a widespread perception that CCGs are putting too many contracts out to tender unnecessarily, driving expense and delay into the system. This is a view that has been expressed by NHS Improvement, NHS England and by ministers – certainly by Jeremy Hunt.

Where the fault lies over this is disputed. With the lawyers for whom the NHS has become bigger business since the 2012 Act? With procurement managers? Or more broadly with CCGs’ fear that if they get things wrong it is they who will be subject to judicial review? What is clear is that the NHS Procurement Regulations require that when a service is put out to tender it must be done in a non-discriminatory way that does not exclude providers on the basis of ownership (Department of Health 2016). In other words, the private and voluntary sectors cannot be excluded from bidding. These regulations reflect current EU law.

The accountability of a more integrated system

The route to better integrated care was first to create some 44 sustainability and transformation plans, which then evolved into sustainability and transformation partnerships (STPs). 

One of the challenges is that neither the STPs nor the integrated care systems into which they seek to evolve have any legal standing. They are not corporate bodies. They have no budget of their own.

These are intended to lead to integrated care systems, where commissioners and providers, along with local authority services and the voluntary and private sectors, come together to provide better integrated care. Within that, a contract, or contracts, could be let to an accountable care organisation, otherwise known as an integrated care provider, for which a model contract is being developed.

The precise nature of such arrangements is a matter for local negotiation. As a recent King’s Fund report makes plain, both the arrangements and progress vary significantly around the country (Charles et al 2018). To date, there has been limited interest in the creation of integrated care providers – just two areas of the country, Dudley and Central Manchester, have expressed an interest in pursuing that route.

One of the challenges is that neither the STPs nor the integrated care systems into which they seek to evolve have any legal standing. They are not corporate bodies. They have no budget of their own. The money does not flow through them and they have no formal accountability in the sense of having a formal board and an accounting officer. They cannot independently make decisions. The power they do have is largely one of moral suasion – a recognition across many parts of the NHS that services do indeed need to change along the lines set out in the Forward View.

The ability to delegate

In many cases, NHS organisations can align their own decision-making with the direction of change agreed within an STP or, as they develop, with an integrated care system. But those decisions are essentially voluntary. The STP cannot compel any NHS organisation to follow a course of action. 

Even when organisations do wish to co-operate, either by shifting services or merging their activities, there are limitations on how far NHS organisations can delegate their powers to create a more integrated system. CCGs have broad powers to do so. They can agree that one of them should exercise the functions of another, and they can indeed merge. NHS trusts (which still make up roughly half of NHS providers) can exercise powers jointly and can delegate powers to a committee – the arrangement, for example, that has allowed Pennine Acute Hospitals NHS Trust to enter into a management agreement with the Salford Royal NHS Foundation Trust. Foundation trusts, by contrast, cannot delegate the exercise of their powers to a third party, save to a committee the membership of which may only be the directors of the foundation trust. They do, however, have a power, which NHS trusts lack, to set up subsidiary corporate bodies that could be used to deliver more integrated care.

Mergers and acquisitions

Foundation trusts can acquire NHS trusts, although this is subject to the agreement of the Competition and Markets Authority. But an NHS trust cannot acquire a foundation trust unless it has first been dissolved by NHS Improvement. That can only happen under particular conditions around which there is some legal uncertainty, and which, in cases where the special administration regime is used, can involve considerable time and expense.

Options for change

There are, of course, almost limitless options for change. Some, for example, might like to rerun the battles of 1948, opting for a service run by local government within which all GPs would be required to be salaried.

There is a constituency for the so-called NHS Reinstatement Bill, which effectively tears up the 2012 Act and starts again. However, the way it proposes to run the service goes beyond merely returning to the pre-2012 arrangements (National Health Service Bill 2016–17). It has been introduced into parliament in various incarnations almost annually since 2013 but has never proceeded substantively beyond a first reading. In 2014 Clive Efford’s more limited Private Member’s Bill sought to remove the commissioners’ obligation to put services out to tender – essentially removing the choice and competition elements of the 2012 Act. That did reach its committee stage, but it fell at the 2015 election.

There have been plenty of other suggestions for legislative change. Two of the most recent and substantive ones came just ahead of and just after Theresa May’s funding announcement. First the House of Commons Health and Social Care Select Committee put forward recommendations (Health and Social Care Committee 2018); and second, Lord Darzi’s review of health and care for the Institute for Public Policy Research also proposed legislation (Darzi et al 2018).

The Select Committee called for:

  • a statutory basis for system-wide partnerships between local organisations
  • the potential to designate accountable care organisations (otherwise known as integrated care providers) as NHS bodies, if they are introduced more widely
  • changes to legislation covering procurement and competition
  • the merger of NHS England and NHS Improvement
  • changes to the CQC’s powers. 

On the last of those points, the committee did not go into detail, but the CQC has undertaken a number of ‘system reviews’ of care for older people (CQC 2018). However, under current legislation it has to be invited to do so by the Secretaries of State for Health and Local Government, and these are ‘reviews’ rather than inspections. The CQC would like this to become part of ‘business as usual’ and to have the power to inspect, not just review, integrated care, including local authorities’ role in providing it.

Lord Darzi’s review went further, recommending:

  • the creation of a single NHS headquarters through the merger of NHS England, NHS Improvement, Health Education England and Public Health England
  • the creation of around 10 regional health and care authorities that could replace the STPs, the 195 CCGs and the 7 regional organisations of NHS Improvement and NHS England
  • the ending of compulsory competitive tendering for frontline services, with the health and care authorities (and NHS and care providers) able to commission services from any provider, but with this clearly becoming an option, rather than, as at present, it often being seen as a requirement.

Even the more modest of these proposals involves major legislative change – whether or not one wants to brand it as another ‘top-down reorganisation’, whatever that might mean. They raise fundamental questions about how it is thought best to run the NHS. 

Even the more modest of these proposals involves major legislative change – whether or not one wants to brand it as another ‘top-down reorganisation’, whatever that might mean. They raise fundamental questions about how it is thought best to run the NHS.

These include how far, and if so, at what level, is it desirable to move away from a key element that has been NHS policy for the past quarter century – namely, the purchaser–provider split? Its proponents would argue that the division between purchasers and providers brought some real gains. It has forced the NHS at the commissioning level to think arguably more clearly than before about which services it wished to provide while having the ability to seek out the best provider of them: whether from the public, private or voluntary sectors.

On the provider side, it has placed a new emphasis on local ownership and responsibility for services, reflected in the fact that chief executives of NHS organisations became ‘accountable officers,’ with NHS trusts acquiring boards that include non-executives. One of the goals here was that locally led, more freestanding bodies would not just compete for NHS services but would have a greater ability to innovate than was perceived to be possible in the more directly managed hospital service that this approach replaced. As the money tightened during the 1990s, the original NHS trusts, created by a Conservative government, lost many of their nominal freedoms. But it is notable that the succeeding Labour government sought to reinstate and enhance those, with greater statutory underpinning, through the creation of NHS foundation trusts. Despite their greater statutory independence, history has repeated itself in that they too have in practice lost many of their operational freedoms as the money has once again become very tight.

So the debate about integrated care, and the sorts of changes outlined above, inevitably raise questions about what happens to the governance and operation of both NHS trusts and foundation trusts. Particularly in the case of foundation trusts, it raises questions about whether that model is to be abandoned. And if so, what it would be replaced by?

In other words, if, as and when significant legislation is drafted, thought needs to be given to what might be lost – to how accountability for taxpayers’ money, and how drivers for efficiency as well as integration are to be preserved.

Then there is the question of what becomes of the tariff, or the NHS price list in these more integrated approaches? It may not be the best way of integrating care, but it still has value for some procedures in driving up and rewarding desirable activity. The existence of the tariff requires that, in order to construct it, the NHS has to have some understanding of its costs, which is essential for any modern business. It provides a benchmark price that helps the NHS to negotiate reasonable prices with the private sector for elective activity. By ensuring that NHS providers get paid for the activities, it also underpins patient choice over where they receive treatment. Relatively few patients exercise such choice. But it remains an important right that many would argue should be preserved.

In other words, if, as and when significant legislation is drafted, thought needs to be given to what might be lost – to how accountability for taxpayers’ money, and how drivers for efficiency as well as integration are to be preserved.

The legislative outlook

Even when such issues have been thought through, there remain barriers to legislative change. The first and most obvious is that the Conservatives still do not have a parliamentary majority. They are reliant on their deal with the Democratic Unionist Party (DUP) whose constituents will not be affected by changes to the 2012 Act. 

Without a general election that produces a clear majority – and another general election is not technically due until 2022 – then any legislative change is likely to require significant consensus to stand a chance of getting through parliament. In other words, it is likely to have to be relatively limited rather than radical.

Moreover, in some areas – most notably around procurement and competition – the law in question is commonly known as ‘EU law’, although it has of course for many years also been UK and English law. This matters because it is far from clear whether merely repealing Part 3 of the 2012 Act – the sections on competition and pricing – would alone be enough to exempt the NHS from the current procurement and competition rules.

Ahead of the 2012 Act there was a widely held view that actions taken by the Labour government meant that competition and procurement law in fact already applied. These included the creation of NHS foundation trusts as public benefit corporations no longer directly answerable to the Secretary of State. In terms of the law this turned them into ‘undertakings’ rather than state-owned bodies. Primary care trusts lost their ‘provider arms’ – for example, community services. In a reinforcement of the purchaser–provider split these were hived off – turned into or handed over to NHS trusts or foundation trusts, turned into social enterprises, or let to the private sector. The Labour government also commissioned independent sector treatment centres – in effect privately run surgical factories for NHS patients. These changes, combined with the tariff, which in turn allowed NHS patients to go to any private hospital willing to treat them at the NHS price, were widely seen to have led to sufficiently market-like conditions for both competition and procurement law to apply. An admission of that came with the Labour government’s creation of the Co-operation and Competition Panel as a non-statutory adviser to both the NHS and the private and voluntary sectors, and to ministers, on the application of such law. The health services in Scotland and Wales lack these features – of which the existence of foundation trusts as public benefit corporations may be one of the most important – and are thus not subject to competition law. They are not under the same pressure to put services out to tender, although the procurement rules apply when they choose so to do.

The 2012 Act may have spelt out the application of competition and procurement law in specific NHS legislation. But it is likely that unless and until the UK leaves the European Union, competition and procurement law will continue to apply. It may do afterwards, certainly in any transition period after formal exit from the EU. It may do more permanently, depending on the precise terms on which the UK leaves the EU – at the time of writing, that is unknowable.

In other words, the seemingly simple proposition of merging NHS Improvement and NHS England raises the question of what would happen to the market regulation side of Monitor – its duty to ‘prevent anti-competitive behaviour’ – which still exists within NHS Improvement.

It should be recognised that even an attempt to introduce a limited Bill will attract amendments by those who wish to see their particular version of how the NHS should be run enacted. It would become a ‘Christmas tree’ on which others would seek to hang their own amendments.

To remove that, and to remove the Competition and Marketing Authority’s role in overseeing foundation trust mergers, it may be necessary to go beyond repealing Part 3 of the Act. It may be necessary to make foundation trusts subject to direction by the Secretary of State and to make contracts within the NHS specifically NHS contracts rather than legal ones. NHS lawyers, however, are far from entirely agreed whether that would be sufficient. And it should be noted that making foundation trusts answerable to the Secretary of State would cut across a core principle of the 2012 Act – namely, that the service, via NHS England, should be overseen by a statutorily independent board, with Jeremy Hunt having judged that ‘the independence of NHS England is the bit [of the Act] that has worked best’ (Timmins 2018). 

Another complication is that, for the first time in the history of significant NHS legislation, ‘English Votes for English Laws’, otherwise known as EVEL, will almost certainly apply. This relatively new proposition, adopted in 2015, states among other things that where the Speaker so rules, legislation that affects England only has to be passed by a majority of English MPs, as well as then having to achieve a majority of the whole House of Commons. It is worth remembering that in the 2000s the legislation that created NHS foundation trusts only passed the Commons with the support of Scottish Labour MPs whose constituents were not affected by the legislation.

EVEL has been described by MPs themselves, as well as by academic commentators, as ‘unbelievably obscure’ and ‘incomprehensible to most Members of this House let alone the wider public’ (Hansard 2015–16). Conservative English MPs have a 60-vote majority over English Labour MPs, which on the face of it may make government-sponsored legislation look easier. But the need for the Bill to gain a majority among all MPs negates that. 

It is at least arguable that in practice EVEL is unlikely to change the nature of any proposition enacted. But it does add a number of stages to the passage of a Bill – up to eight – which could lead to both delay and the possibility of parliamentary accidents.

It does raise one other, unlikely, possibility. To get legislation through, and assuming that the other parties oppose it, the Conservatives would need the DUP’s votes. Any change in the directions outlined above, however, would move the English NHS a step or two closer to the arrangements in Scotland. There the Scottish National Party (SNP) is bitterly opposed to the English purchaser–provider split. So might there be the outside possibility that the SNP could be persuaded to abstain on such legislation, doubtless in return for something else? A wise punter would probably not bet on that.

Finally, it should be recognised that even an attempt to introduce a limited Bill will attract amendments by those who wish to see their particular version of how the NHS should be run enacted. It would become a ‘Christmas tree’ on which others would seek to hang their own amendments. Even a limited Bill will thus be controversial. It will allow much bigger issues to be raised than its original limited intent, and will be hard for a government without a proper majority to enact. It is worth noting that on the related issue of social care, the promise – not of something as radical as legislation but merely of a Green Paper – has been on the stocks since 2015 but has yet to slide down the slipway.

If legislation is likely to be difficult, what might be done within the existing legislation?

More flexible than it at first appeared

A key aim of the 2012 Act was, in the words of its author Andrew Lansley, to make it ‘permanent’. It set out how the service was to be run in detailed primary legislation so that it could not be changed without another Act of Parliament – rather than it being changed by ministerial discretion and decision-making.

But, in the words of David Bennett, the former chief executive and chair of Monitor, ‘well, it hasn’t been changed. It’s just been ignored!’ (Timmins 2018).

That, of course, is an over-statement to make a point. But it is clear (as argued in Timmins 2018), that in many ways behaviour has trumped the legislation. It has also done so in ways that at least begin to answer some of the ‘problems that need fixing’ – namely the reinforcement from top to bottom of the purchaser–provider split, over-regulation and assurance, the procurement rules, the accountability of a more integrated system, the ability to delegate, and mergers and acquisitions.

For example (and to take them in a slightly different order), at the instigation of Jeremy Hunt when health secretary, Monitor and the Trust Development Authority were merged into NHS Improvement. That had to be done through a legal workaround. They now have the same chief executive and chair, while still technically operating with separate boards and producing separate accounts.

But, in the words of David Bennett, the former chief executive and chair of Monitor, ‘well, it [the Act] hasn’t been changed. It’s just been ignored!’

The trust oversight parts of NHS Improvement – although not the market regulation part of Monitor – are now undergoing a de facto merger with NHS England, although the law makes that workaround appreciably more complicated. The twin organisations cannot have the same chair and chief executive. But it has proved possible to have cross-representation on their boards through the creation of ‘associate (non-voting) non-executive directors’. Joint senior appointments are being made, and the regional structures of the two organisations are progressively being merged. That is neither neat nor wieldy (a meeting of the joint boards is likely to involve almost two dozen people). 

But awkward though that is, it is starting to dilute the purchaser–provider split at the national level, while the creation of integrated care systems is deliberately diluting it at the local one. By establishing a single financial and operating planning process for the NHS, a single performance management process and the alignment of regulatory interventions, it seeks to address the complaint that the two organisations are sending mixed signals to the service – even if at more regional and local levels trusts do still make that complaint.

The issue of over-assurance – too many people demanding too much information in too many different ways – is, at least in part, an administrative and management issue which should be addressable without legislation, again at least in part.

Mergers and acquisitions, at least in so far as they affect foundation trusts, are baked into the law. The Competition and Markets Authority (CMA) has a role here, and one that creates delay as it examines whether a merger involving a foundation trust will reduce competition. It is notable, however, that the CMA has started to recognise more clearly that there can be benefits to patients in terms of the outcome of treatment when both specialised services such as stroke and major trauma and more routine ones – elective orthopaedics, for example – are concentrated in fewer hands. Perhaps in part because trusts have made a better case for merger in recent years, the CMA has not prevented any of the mergers put forward since its predecessor blocked the original proposal for the merger of Bournemouth and Poole foundation trusts in 2013 – a merger that now appears to be going through. In 2017, in a report on a planned merger in Manchester, it noted that financial pressures on the NHS service ‘have dampened the role of competition between trusts’ (Competition and Markets Authority 2017).

Regarding the ability to delegate, many NHS organisations, in seeking to get to better integrated care, already have considerable powers to delegate their functions to others. One key exception is that NHS foundation trusts cannot do that. How far that is in practice a serious obstacle is not clear. If it is, a change in the law would be needed.

Excessive tendering and procurement may well be addressable by doing less of it. The tests of whether it needs to be done are, to put it mildly, complex (see, for example, NHS Improvement 2017 and the references on page 6 of that document). NHS Improvement does offer guidance and advice to CCGs on when services need to be put out to tender. The guidance is clear that in the right circumstances the requirement under the 2012 Act to provide services ‘in an integrated way’ can trump any requirement to put them out to tender. Nonetheless, many CCGs are clearly deeply worried about being subject to judicial review if they get it wrong. The answer here might well be for the national bodies – NHS Improvement and NHS England – to make it clear that they will stand behind any CCG subject to judicial review if, having taken advice from NHS Improvement, it decides not to put a service out to tender. This might lead to some test cases. But at least this would clarify the law, resolving how far the duty to provide care ‘in an integrated way’ can overcome the requirement to prevent ‘anti-competitive behaviour’.

The accountability of the emerging integrated care systems is an issue that will at some point have to be addressed. As already noted, neither the STPs nor the emerging integrated care systems have either a legal basis or a budget of their own. They remain essentially voluntary arrangements, with all the strengths and weaknesses of the use of ‘consensus management’ from the 1970s and early 1980s. 

Where there is clear agreement about what needs to be done, real progress can be made. But where either a key partner or partners are reluctant – for whatever reason – life is much more difficult. Questions remain about who will hold the budget for an integrated care system and how it will be held accountable.

One tempting route, at first sight, might be a power that remains in the 2012 Act to create special health authorities. They are subject to a ‘sunset’ clause. In other words they have to have an abolition date no later than three years after they take effect, although that can be extended for up to another three years. The legislation appears to be broadly permissive in that the Secretary of State can prescribe their functions. But special health authorities in the past have normally been national bodies and the Act clearly envisages that that would be their purpose. If integrated care systems were created as special health authorities (that is, one by one, and as they were ready to run an integrated system), they would then cease to be ‘special’ and thus would clearly be open to legal challenge. They would have to be almost permanently preparing for their own demise, given the ‘sunset’ clause. NHS Improvement and NHS England have no regulatory powers over a special health authority. Instead these authorities would be answerable to the Secretary of State, who would regulate and oversee them – cutting across the independence of NHS England. They would therefore clearly be in contravention of the intentions of the Act. To avoid duplication, CCGs within their area would need to be abolished. There would be questions about how the money could flow to them and, in the absence of legislation, what powers they could in fact have over trusts in general and foundation trusts in particular. Creating integrated care systems as special health authorities thus does not look like a viable route.

The Act bears some resemblance to a badly knitted woolly jumper – pull on one loose thread and the whole thing starts to unravel.

Given that much of integrated care is a decidedly local matter involving better alignment of primary, community and social care, there have been suggestions, including from the Barker Commission, that health and wellbeing boards might play a larger role (The King’s Fund 2016). Like integrated care systems, the development and effectiveness of health and wellbeing boards varies widely. As statutory committees of local authorities they have limited formal powers. In a few areas they have developed joint commissioning arrangements, although often for relatively limited services such as mental health and disability (Humphries and Wenzel 2015). Such voluntary arrangements could be extended. But for health and wellbeing boards to have a much more extensive role in health commissioning, it looks likely that legislation would be needed. In effect this would allow them to adopt the route chosen in Scotland where, in many areas, joint integration boards between health and social care have been established under legislation that was passed in 2014.

A more likely route for an integrated care system within the existing Act is for CCGs to merge or form joint committees. That would bring together the commissioning side under an accountable body that would then work with providers, via joint committees where possible, and with local authority social services, to commission and provide better integrated care. It could be given a system control total for its area. That could work well where unanimity can be reached with providers on service change. But where providers for whatever reason are unable or unwilling to acquiesce, legislative change may be needed – for example, changing the licence conditions for foundation trusts, or even subjecting them to some form of direction. 

Again this raises the underlying questions highlighted earlier about how far the foundation trust model is to be abandoned. The Act bears some resemblance to a badly knitted woolly jumper – pull on one loose thread and the whole thing starts to unravel.

The risk of judicial review

The more the Act is worked around, and its limits pushed, the greater the risk of judicial review. There have already been two significant cases. The first in essence sought to argue that NHS England cannot use a ‘whole population annual payment’ to fund an integrated care provider but has to use the tariff – individual payments for those treatments and procedures that are covered (Shepherd (on behalf of 999 Call NHS), R (on the application of) v National Health Service Commissioning Board 2018). The court ruled in favour of NHS England, although leave to appeal has been granted. In the second case (Hutchinson and Anor R (on the application of) v Secretary of State for Health and Social Care 2018), the court ruled that NHS England’s proposed accountable care organisation contract – now renamed an integrated care provider contract – is lawful, although its precise nature remains subject to consultation.

Both cases – the first subject to appeal – have made the law clearer. Other cases may follow, but that may be the price for testing the flexibilities of the existing legislation. A significant defeat would of course add to pressure for the Act to be amended.

Conclusion

Given the widespread dissatisfaction with the current legislation, the Prime Minister’s invitation to the NHS to propose changes makes sense. But even if ‘the NHS family’ can by next Spring agree what those changes should be (and that is not entirely a given), and if the cross-party Health Select Committee felt able to endorse them (which would help), it is far from clear that there is the necessary majority in parliament to deliver primary legislation. For as long as the UK remains in the EU, and during any transition period that is finally agreed, legislation may need to be extensive – including possibly abolishing the foundation trust model – in order for the current procurement rules not to apply (if that is one of the aims). It is also worth noting that even if there were agreement by next Spring on legislative change, and the government felt able either to facilitate legislation or enact it, this would not be passed before 2020 at the very earliest. Depending on how extensive the changes are, it is likely to be at least 2021 and possibly 2022 before legislative change is implemented.

The NHS, however – to quote the Griffiths management report of 1983 – cannot afford a Hamlet-like soliloquy while it waits for and seeks legislative change. For now, the more pressing issue is to continue to test the flexibility of the current legislation.

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