By Phil Harding, Network Advisor for Health and Social Care
The 2013 Spending Round (SR) contained significant news on funding for Health and Social Care. Much of what was announced reflected the recent growing focus within Government and the health care profession upon greater integration of health care provision.
The main emphasis was the increase in funding for a single pooled budget for health and social care. This budget aims to see joined up health care provision working alongside an emphasis on prevention, managed at a local level, with the hope that this will see an increase in the impact and benefit of the money spent.
However within the context of this focus it is important that we learn from the lessons from some of the successful partnerships that already exist.
Spending Review 2013
The Spending Round made a number of significant funding announcements for Health and Social Care. These included:
- The continued increase in spending on health care to ensure that it continues to rise in real terms in line with the Coalition Governments commitment.
- The Government also increased the amount of funding allocated from the NHS budget into a single pooled budget for health and social care services. Initial funding of around £1bn from the NHS in 2014-15 will be increased by another £2bn to £3bn in 2015-16. This pot will be supplemented with an additional £0.8bn from other sources of funding such as reablement funds from Clinical Commissioning Groups (CCGs) and local authority funding for disabled housing grants.
- The result is funding of £3.8bn for a single pooled budget for health and social care services in 2015-16. This funding will aim to see providers work more closely together in local areas, based on a plan agreed between the NHS and local authorities. The objective of the single pooled budget is to deliver better, more joined-up health and social care services, especially for older and disabled people, with the aim of reducing costs in the long term by preventing hospital visits and to avoid long and expensive hospital stays.
- The SR also saw the allocation of an extra £200m available in 2014-15 as an upfront investment in new systems and ways of working that will benefit both services;
- And £335m being made available to local authorities in 2015-16 so that they can prepare for reforms to the system of social care funding, including the introduction of a cap on care costs from April 2016 and a universal offer of deferred payment agreements from April 2015.
The purpose of the shared pool
Although the details of the shared pool are yet to be fully mapped out by the Government its intentions seem clear. By moving money from the central NHS budget to social care and prevention the Government is looking to ensure that care is driven more locally and that responsibility for more spending decisions also rest with local bodies. It also hopes that by investing in prevention and relieving pressure from traditional front line responders that it may be able to make significant efficiency savings.
There are clear hints that the government is hoping that integrated working will lead to savings. At the SR it said these moves would “following the example of the Whole Place Community Budget pilots.”
It also included reference to the Troubled Families Programme, stating that the programme is:
“giving the children in these families a better life and reducing the high costs to the public sector that result from anti-social behaviour, worklessness, A&E visits, police call outs and truancy…
“Following the success of the programme, the Government will provide a further £200 million in 2015-16 to expand this work to 400,000 families that may require assistance with multiple problems.”
“The aim of the extended programme will be to reduce this reactive cost to the public purse and add momentum to the reform of uncoordinated services for families. The Government will pay local areas by results for real improvements to families’ lives and for demonstrable savings to the public purse.”
While this move is welcome if it does increase the success of prevention, it is important to note that at present an estimated 84 per cent of public spending on “troubled families” is reactive, with only 16 per cent invested to try to improve their lives and therefore reduce costs for the state. Further evaluation will be needed of the impact of this new funding structure before we will be able to assess whether the Government has achieved its aims and tackled some of the problems associated with troubled families and therefore reduced spending through prevention.
Prevention in Health and Social Care
Another important factor in determining that success will be the split of spending in Health and Social Care, again between reactive and preventative funding. Currently Public Health spending is less than 4% of the Health and Social Care budget. Direct Health and Social Care prevention spending is less than this. This means that well over 90% of Health and Social Care spending is reactive and unaffordable in the long term unless we invest more in prevention.
The spending Round provides an opportunity to see a shift in investment for more money to be invested in prevention with additional funding:
- to prevent the early onset of long term conditions which account for 70% of all health and social care funding;
- to reduce the onset of Type 2 Diabetes and improve the support given to those with Type 1 and Type 2 Diabetes. £10bn is spent on treatment of those with Diabetes yet 80% of this is avoidable;
- to improve the health and well-being of families - with successive studies highlighting that the health and well-being of children is lower than most developed countries - with family breakdown costing £46bn.
- beyond the pool making use of the £100 million collaboration and efficiency fund to help local authorities to cover the upfront costs of working with each other and encourage better ways of operating.
The scope for increased investment in prevention will be explored in the next Health and Social Care Network series looking at New Opportunities for Savings - with two events one in London on the 17 July and the other in Manchester on the 18 July.