Background and context
1
We were commissioned by the three key public sector organisations on the
Island involved in Health and Social Care to develop and appraise options for
organisational structures to take forward work done in the last two years on
strategy for the delivery of health and social care. The terms of reference of the review are given in Appendix 1.
2
In autumn 2002, under the direction of the Hampshire and Isle of Wight
Strategic Health Authority (SHA), the NHS organisations in Hampshire and the
Isle of Wight embarked on a process called HealthFit. This process aimed to
develop an agreed strategic framework for the development of sustainable,
efficient and affordable health services in the local health economy. The two
healthcare organisations on the Isle of Wight (IOW), and with the involvement of
officers within the Social Services & Housing Directorate of the Isle of
Wight Council, developed their own local strategy in response to HealthFit,
which is known as the IOW Local Healthcare Strategy.
3
The local strategy reflects the changes that the health and social care
stakeholders believe are necessary but would require further amendment to
ensure it reflected necessary health and social care developments. The focus of
the local strategy is service oriented as it identifies changes that are
required in areas such as maternity services, mental health, children’s
services to name a few. One of the key elements of the local strategy is the
commitment to joint working. In June 2003 the Council wished to build upon the
HealthFit document and agreed with health partners a commitment to joint
working with the possibility of organisational change. This was encapsulated in
the “statement of intent” which described the desire to see joint delivery of
care, and a move to integration of services where possible.
4
Following on from the commitment to joint working, it was agreed between
the Island health organisations and the SHA that the shape and configuration of
Island Health organisations should be reviewed. This decision led to the
appointment of external consultants to conduct the review.
5
From a national perspective the recently published NHS Improvement Plan
“Putting people at the heart of public services”, June 2004 emphasises the need
to continue to develop high-quality services that are responsive, convenient
and personalised. It focuses on
improving waiting times even further, ensuring public health is central to the
decision making processes and encourages a wide range of service providers to
be considered in order to achieve the targets. Linking this to a local agenda
which needs to address severe financial challenges means that the design of
services and organisations are critical to its success
6
We commissioned Bevan Ashford to provide a legal view under existing
legal frameworks and current NHS regulations on shortlisted options, solely for
the purposes of this review and to support our conclusions. You should take
your own legal advice on the final decision.
Process for conducting review
7
A steering group was formed in April 2004 and has met 5 times, providing
the project with direction and key decisions.
The members of the group are given in Appendix 2. We clarified our terms of reference with the
steering group, and confirmed that our focus is on organisational design rather
than service strategy.
8
We then interviewed 18 key stakeholder groups on the Island (Appendix 3),
analysed their views on the status quo and options for change, and developed a
number of options:
·
Option
1 Do not change the current organisational reconfiguration
·
Option 2 The Isle of Wight Healthcare Trust transfers all primary and community care services (including mental health) to the
Isle of Wight Primary Care Trust, leaving a core service of acute focused
provision, including ambulance services
·
Option 3 The Isle of Wight PCT transfers all primary and community care services
to the Isle of Wight Healthcare NHS Trust, leaving the PCT to focus on its
commissioning function. (The PCT would continue to commission public health and
GP services)
·
Option 4 The management executive teams of the Isle of Wight Primary Care NHS
Trust and Isle of Wight Healthcare Trust merge. This will retain two legal
entities (the PCT and Healthcare Trust) until further changes are agreed
·
Option
5 Establish a health & social care trust on the Isle of Wight that
includes commissioning functions
·
Option
6 Establish a health & social care trust on the Isle of Wight that does
not include commissioning.
·
Option
7 SHA as commissioner of services for the island’s population. Establish a
Commissioning organisation that is an “out-post” of the SHA, and as part of
this the primary care functions transfer into one health service body on the
Island
·
Option
8 Establish one Public Service organisation on the Island that encompasses
all public services on the Isle of Wight
·
Option
9 Establish a joint commissioning body and develop clinical networks of
care so that services are commissioned on a programmed basis. This could mean
that service provision is provided from a mixture of Island only, mainland only
and Island/mainland services, including the independent sector
At
that meeting we also agreed the following evaluation criteria:
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The criteria are as follows:
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- Is the option sustainable?
(sustainable
meaning the ability to ensure long term flexibility and viability of
organisational configuration bearing in mind any future changes)
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- Does it provide the potential to achieve
economies of scale and reduce costs?
|
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- Is it consistent with, and assists in the
development of, the local healthcare strategy?
|
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- Does it recognise existing and emerging
national policy and planning guidelines for the NHS and Social Care
agenda’s?
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- What is the ease of transition and timescale
for change?
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Outcomes of discussions and evaluation
9
Three options were
discarded early on as they could not sensibly be evaluated using the agreed
criteria and scoring:
·
Option 4 – Merging the
management of the PCT and the Healthcare Trust – this was the SHAs proposal.
We concluded that this could not be evaluated separately as it could only be regarded as a step in a
change to a future organisation
state. However clearly this could be a
sensible first step for a number of
options.
·
Option 7 – there were
to many similarities to option 6
·
Option 8 – one public
service body for the Island – although a number of those we talked to saw this long term goal, the
level of debate and consultation required to appraise
this option was not possible within the time and the agreed terms of reference.
10 At the steering group
meeting on 24 May, options were scored.
The remaining options following scoring were 5 and 6. Further work has since been done to refine
the options, understand the potential legal issues and develop an indicative
transition plan. These were presented
to the steering group on 22 June and 6 July.
Short-listed options
11
The two short-listed options are as
follows:
·
Option 5 Establish a health
& social care trust on the Isle of Wight that includes commissioning
functions.
·
Option 6 Establish a health
& social care trust on the Isle of Wight that does not include
commissioning.
12
Strengths and weaknesses for the two
options have much in common. For example, both options will enable greater
coordination and integration of services across health and social care. From a
patient perspective, this has the potential to provide seamless care and a way
of developing a joined up strategy for the longer term provision of care.
Similarly, each option provides a logical step to creating a single public
services body in the future. This would be innovative and would require a
significant shift in policy and legislative changes despite an increasing
emphasis given to cross sector working across Government.
13
From a financial perspective, there could
be scope to achieve savings. It has not been possible to establish the costs of
establishing or operating the new organisation. Based on our experience of
organisational change of this magnitude we would expect to see greater
efficiencies in areas such as senior management, human resource departments,
financial services and information management and technology departments.
14
Option 6 potentially provides a
clearer separation for the commissioning function, whereas the lines of
commissioning in Option 5 could be less effective if robust arrangements for
ensuring transparency and challenge are not in place. This is particularly
important in relation to two key NHS initiatives: Patient Choice and Payment by
Results.
15
Option 6 was initially developed with
a view that commissioning could be either mainland or Island based. For the
purposes of this review the concept of commissioning being mainland based has
not been developed as it is outside the terms of reference.
Drivers for the short-listed options
16 We considered five key drivers for change in the NHS
and on the island to throw further light on the short-listed criteria.
Cross Sector working
17 The
Office for Public Management (OPM) contributed to the HealthFit process by
identifying key forces and drivers for change the NHS.
Their identification of cross-sector working as a driver is particularly
relevant here. They reported that the Government’s policy direction is
underpinned by an understanding that the wider determinants of health and the
well-being of the population do not lie solely within the remit of health
services. In order to address health inequalities it requires cross-sector
working at all levels.
18 The
two options that have been developed will help to achieve a greater degree of
cross sector working because there will be a requirement to develop an
integrated vision for the provision of health, social care and housing on the
Island. This in turn should result in a unified strategic plan that reflects
the objectives of all stakeholders involved in the delivery of care. This will
provide an innovative model locally (i.e. within the Hampshire & IOW
economy) and nationally.
CHOICE and Payment by Results
19 These
initiatives pose real challenges to the Island in offering realistic options
for alternative providers regardless of the organisational configuration option
that is chosen. It could be argued that if there is only one organisation that
includes commissioning the need for robust commissioning functions will be
paramount to ensure that the Patient Choice agenda is implemented and that
historical reasons for commissioning do not become the primary driver.
20 The
local response to HealthFit considers the issues of transport costs for
patients who require mainland based treatment. If in the future there is
agreement that patient transport costs are met either partially or in full for
mainland based treatment, then the Patient Choice agenda takes on a different
perspective on the Island and will represent an even stronger challenge from a
governance perspective to ensure that commissioning and choice is robust and
transparent.
Commissioning
21 The
key issue for Option 6 will be the establishment of appropriate Governance
arrangements. Initially, the PwC project team considered three broad
sub-options for the stand alone Commissioning body:
·
Entirely stand alone
(separate commissioning body)
·
Exist as part of the
(expanded) LA Commissioning team
·
Exist as part of the
SHA
22 The key factor in assessing these three alternatives
is the issue of Governance and the legality of each. Based on the advice
provided to PwC, the position is that:
·
Sub-option (ii) would not be possible
because the Local Authority cannot commission a wide range of acute health
services (e.g. surgery).
·
The third sub-option (iii) is also not
possible given the existing statutory framework. Neither is this option seen to
fit with the current direction of national or local policy.
23
The first sub-option (i), of the
entirely stand alone body, is feasible. However, a number of caveats exist
regarding how this could be achieved. For example, a PCT which covers the IOW
is a statutory requirement therefore one option could be for the PCT to cease
providing services itself and commission these services from the Healthcare
Trust. Further detail is provided in the section relating to what is legally
possible in the main body of the report.
Leadership
and creating capacity
24
One of the key issues in bringing
about change of this scale will be the ability of the Island Health economy to
create additional capacity to help manage the change process. In addition to
this there is a need for dynamic leadership that can create the unity of vision
that is required to achieve this change.
25
Due to constant and demanding
pressures, relationships appear strained between executive teams of the Isle of
Wight PCT and Isle of Wight Healthcare Trust. Whilst this may be an unfortunate
trait in today’s NHS, locally, it reinforces our view that the need for single
management and leadership of the two healthcare organisations is a necessary
step in the process of bringing about organisational change, as long as it can
be implemented within existing and future legal frameworks and NHS regulations.
Achieving financial stability
26
One of the key challenges facing the
Island is how to achieve financial stability without adversely affecting the
quality of patient care. This is a key driver for change. However merely
reorganising the organisations will not necessarily result in less cost or
indeed contribute to achieving financial balance. The opportunities to achieve
management cost savings may be negated by the need to create additional
management capacity, at least in the short term. However, a new organisation should lead to greater
opportunities for increased efficiency by streamlining processes and
introducing new ways of working.
27
One factor that will influence the
Island’s ability to achieve savings could be the implementation of the European Working Time Directives (EWTD).
The isolation of the Island may lead to some services potentially becoming
unviable unless provided by outreach from larger organisations.
28
The EWTD is a directive from the Council of the European Union
(93/104/EC) to protect the health and safety of workers in the European Union.
It lays down minimum requirements in relation to working hours, rest periods,
annual leave and working arrangements for night workers. The Directive was
enacted in UK law as the Working Time Regulations, which took effect from 1
October 1998. The impact of implementing this is immense in terms of
affordability, improving working lives and maintaining safe levels of working,
to name a few key concerns.
Organisational transition
29 We have mapped out in Tables 1 and 2 indicative
transition plans for Option 5, Option 6 and the integration of Children’s
Services.
30 The following need to be considered in more detail:
·
The transition process needs to be funded and have
dedicated support. A change programme such as this cannot succeed without
having dedicated project management.
·
It will require effective co-ordination of actions
across all key stakeholders, while ensuring that existing operations continue
unaffected.
31
For the changes to have maximum
impact, they need to be implemented as soon as possible, recognising legal and
recruitment timescales.
Integration of children’s services
32
During the course of our work, the Children’s Services
stakeholder group demonstrated a strong, unanimous desire to pursue the integration
of Children’s services on the Island. The group is very keen that integrated
Children’s services should not stand alone or be independent from the envisaged
Health and Social Care Trust for the Island. While this would certainly appear
possible within the scope of the current guidance, specific advice on the
acceptability and process for achieving this would need to be sought. Further
guidance on the process for establishing Children’s Trusts is due to be issued
by the DfES in 2004/2005.
33
Clearly the timing of integration needs to be considered
alongside a number of other factors, including project management capacity,
establishing governance arrangements and, importantly the impact integration
will have on the Council.
34 It
would be feasible to develop a Children’s Trust in parallel with the formation
of a Health & Social Care Trust (HSCT), and consider the integration of
this into the new organisation at a later date. The steering group on 22 June agreed
that integration of a Children’s Trust into the new organisation is unrealistic
at the outset of the new organisation, because:
·
the new guidance on Children’s Trusts will be provided
later this year and will require further discussion with DfES, DoH and ODPM in
the context of this innovative approach;
·
of the impact on the council’s viability and political
position through the loss of its two largest service areas namely Social
Services and Education; and
·
how members will conduct their corporate parenting
responsibility if the service transferred to HSCT.
35 This
may well impact on the timetable for the development of a Health & Social
Care Trust by April 2006. The above issues need to be resolved for Children’s
Services to become a part of the new organisation. The main focus should be the
development of a Children’s Trust as part of the Local Authority by April 2006
and integration into the new organisation should be considered at a later date.
By this time there will be greater clarity in the governance and reporting
arrangements for Children’s Trusts.
Shared Services
36
We identified opportunities for maximising the potential of sharing
corporate services, notably Finance, HR, IT, and Estates Management. The
creation of a new organisation means that services across the Local Authority
and health partners could be shared, for example Human Resource departments
would lend itself to this and other “backroom” functions with the IM&T
departments.
37
We identified the existing arrangements for sharing of services and it is
clear from this that the majority of services are provided by the Health Care
Trust for the PCT and the Corporate Services Department for the Social Services
& Housing Department of the IOW Council.
38
There appears to be limited use of mainland services in the provision of
corporate type functions and we recommend that the potential for testing for
value for money needs to be explored further.
Conclusions
39 We recommend that the Steering Group should pursue Option 5 or Option 6.
40 It was agreed by the Steering Group on 10 May that we would not identify
a preference for either of the two options. It was felt that both options
needed to be considered by each respective organisation in light of what we
have reported, following which a decision would be made on which way to
proceed.
41 The decision to review the organisational
configuration has been one of the catalysts for change. Stakeholders have
suggested, quite forcibly at times, that the need for change is a necessity and
that the status quo cannot continue.
42 In relation to the integration of children’s services there is clear
ambition to integrate fully into the new organisation. Whilst this is positive
the timing of this transition and impact on the IOW Council needs to be
carefully considered before any firm decision is made. Key stakeholders for
children’s services need to embark on further consultation with the IOW
Council, PCT and Healthcare Trust to agree the steps required to achieve full
integration.
43 In summary, we believe that both of the options that have been
short-listed could achieve the Island’s original purpose for commissioning this
review – that being the reconfiguration of organisations to achieve the Isle of
Wight Healthcare Strategy and to deliver safe, affordable and appropriate
healthcare.
Way
forward
44
In determining the way forward we have made the following recommendations:
41.1The
content of this report should be considered by each respective organisation in order to choose which option to
pursue.
41.2Once
each organisation has considered this report, a period of consultation should commence.
41.3Once
a decision has been made in principle based on internal and external consultation, further detailed legal
advice should be sought on the legal process to
be followed.
41.4Subject
to remaining within current and future legal frameworks and NHS Regulations, the NHS in Hampshire &
Isle of Wight should strongly consider the
appointment of a single CEO and executive management team to provide leadership for the PCT and Healthcare Trust.
41.5Once
the CEO is appointed, a Transition Steering Group (TSG) needs to be established to direct and drive the change
process.
41.6Specific
project management support for the TSG should be identified and appointed.
41.7Project
Board should be established to direct the integration of children’s services. This Board should encompass senior
representation from each of the three
principal service areas: Health (PCT and Trust), Education and Social Services.
41.8The
Project Board should appoint a Project Manager to drive the day to day progress of the children’s integration
project.
41.9Project
Manager (as in 41.8 above), with oversight from the Project Board and in consultation with the relevant
stakeholders, to produce a detailed Project Plan to achieve the integration of Children’s services (in a Children’s
Trust or other body within the LA) by
April 2006. The project plan must include key milestones (as set out in the LPS), but also the
detailed steps and actions required.
41.10
A detailed study should
be conducted to explore the development and use of shared service agencies that could support the IOW and to ensure
that existing shared service
arrangements are providing effective and efficient services.
