Agenda Item 6.4 CCG Board EXECUTIVE SUMMARY SHEET

Transcription

1 Agenda Item 6.4 CCG Board EXECUTIVE SUMMARY SHEET DATE: 9 th August 2016 TITLE OF PAPER: Financial Position- Month 3 EXECUTIVE RESPONSIBLE: Laura Boden - Acting Chief Finance Officer Ext: lboden@nhs.net AUTHOR (if different from above) CCG OBJECTIVE: Ruth Yates- Finance Manager Ext: ruth.yates7@nhs.net 9. Improving quality of health outcomes within the agreed resources. For Information X For decision For performance monitoring X EXECUTIVE SUMMARY (Key points in report) This report provides an update on Telford and Wrekin CCG s financial position for the period ending 30 th June 2016 and performance against key financial objectives. We are currently on target to achieve our agreed financial targets. Our forecast assumes continuation of prudent financial management and QIPP delivery. A number of our partners within the health system face significant financial challenges. The CCG is working with partners, where possible, to support the local system through the Sustainability and Transformation Plan (STP). FINANCIAL IMPLICATIONS: EQUALITY & DIVERSITY PATIENT & PUBLIC ENGAGEMENT LEGAL IMPACT: RECOMMENDATIONS: As outlined above None None None Members are asked to: Note the current financial position reported at Month 3. Note that the CCG is currently on target to achieve a business rules 1% surplus. Note the risks highlighted in the report. Note the financial challenges faced by partner organisations within the health system. Is there a need to consider inclusion in the Corporate Risk Register? No

2 1. Executive Summary This report provides an update on Telford and Wrekin CCG s financial position to 30 th June 2016 and performance against key financial objectives. A summary of performance against the objectives is shown in the table below:- Objective RAG In Month Comments Change Our year to date position is in line with the plan trajectory Our year to date position is currently in line with plan. At Month 3 there is a 50,000 surplus against available resources. Our year end forecast is in line with breakeven plan We are currently on target to achieve a breakeven position against available resources. We are on track to achieve the 2.4m required surplus. We do not exceed our Running We are reporting a 39k underspend against running costs at Month 3. Cost Allowance We deliver recurrent cashable efficiencies outlined in the QIPP Programme Recurrent cashable efficiencies based on current contractual performance are significantly below plan year to date and the overall forecast is now 0.1m below plan. Our Cash balances are a max. of During Month 3 the CCG achieved this target. 1.25% of drawdown at month end We pay our bills in line with Better Payment Practice Code In June we achieved this target for value and volume for both NHS and Non NHS invoices which is a significant improvement on previous months. We live within our Capital The CCG applied for a small capital allocation for 2016/17 of 42k. We are Resource Limit awaiting confirmation from NHS England that we will receive this allocation. Appendix 1 shows the key data return that has been submitted to NHS England for Month 3. Key On Track Moderately Off Track Materially Off Track Improvement No Change Deterioration 2

3 2. Summary Financial Position Month 3 Appendix 2 shows the overall financial position for the CCG at the end of June 2016 split by expenditure area. This is summarised in the table and chart below:- Key Messages Apr May Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar Acute Primary Care Running Costs Total Budget Forecast Outturn Forecast Variance Budget YTD Variance by Major Spend Area Actual Non Acute Other Primary Care Co-Commissioning Variance Total Resource Limit 234, , ,006 38,006 0 Acute services 111, , ,776 27,506 (270) Community Health Services 24,827 24,530 (297) 6,207 6,078 (129) CHC, FNC & Special Placements 8,847 9, ,309 2, Mental Health Services 16,310 16,016 (294) 4,077 3,947 (130) Primary care services 35,940 35,598 (342) 8,950 8,868 (82) Other 8,034 7,802 (232) Running costs 3,773 3, (38) Primary Care Co-Commissioning 22,576 22, ,644 5,618 (26) Total Expenditure 232, , ,640 56,591 (49) Budget (Surplus) / Deficit (2,423) (2,423) 0 18,634 18,585 (49) The CCG is currently on target to contain expenditure within its available resources. Delivery of QIPP schemes and strong management of contracts will be key in delivering the overall surplus target. During month 4 the CCG has been informed of a significant cost pressure relating to a national decision to increase Funded Nursing Care prices from 112 per week to per week. This is not included in the figures presented at month 3 but will be reflected for month 4. Initial calculations indicate a value of 0.5m. The CCG will need to use contingency reserves to fund this. It should be noted that the CCG has been given delegated co-commissioning for Primary Care and a separate allocation of 22.6m for 2016/17. The financial position against this allocation is included in this report and the detail of this budget is reported to the CCG s Primary Care Committee. Key points from each expenditure header are highlighted in the following pages. 3

4 3. Acute Services Month 3 Total Budget Forecast Outturn Forecast Variance Budget Actual Variance In County NHS 95,364 95,169 (195) 23,680 23,365 (315) Out of County NHS 7,084 7, ,771 1, WMAS 5,303 5,284 (19) 1,326 1,306 (20) NCAs & Other 3,995 4, , Total Acute Services 111, , ,776 27,506 (270) YTD Variance by Major Spend Area Apr May Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar Key Messages Financial performance against the following areas are of note:- Further detail can be found in appendix 2 In County NHS Initial SLAM data for Month 2 from SATH indicates an under performance against contract of approximately 597k so far for the year. The position reported in the table reflects the financial agreement between the CCG and SATH which will be finalised in quarter 1. It also reflects a correction to the partially completed spells balance, which is an error that arose in 2014/15. This has now been corrected and shows a favourable variance of 195k. Initial data from RJAH shows an underspend of 119k so far this year. The underspend mainly sits in PbR Electives. Other Acute Contracts Based on the information that we have received at Month 2, these contracts show an overall slight underspend of 31k against plan. This position includes overspends at Birmingham Children's and Sandwell & West Birmingham and underspends at Royal Wolverhampton and the Nuffield. Contracts will be closely monitored throughout the year and any significant variances will be reported to PPQ In County NHS Out of County NHS WMAS NCAs & Other

5 3a. Acute Services SaTH Admitted For the first two months of 2016/17, combined SATH admitted activity is under plan by 105, 2% of contracted activity. Financial performance is under by 151k. The majority of this underspend sits within Electives. The graphs below show how this compares to the last twelve months of activity and costs. Point of Delivery Activity Cost Var Caused by: Plan Actual Variance Plan Actual Variance Activity Price '000 '000 '000 '000 '000 Admitted 5,874 5,769 (105) 8,090 7,939 (151) (145) (7) Note:- This is based on 2 months initial activity. Costs exclude the impact of Emergency Threshold adjustments. 5

6 3a.1 SaTH Admitted Elective / Non Elective SaTH Elective Activity As at Month 2, 2016/17 SaTH Daycase Activity is over-performing by 41 spells and 24k. Elective activity is under plan by 59 spells and 175k. SaTH Non Elective Activity Emergency activity is under plan by 107 spells and under performing financially by 22k. Non Elective activity is currently over performing on plan by 19 spells and 22k. 6

7 3b. Acute Services SaTH Outpatients For the first two months of 2016/17, SATH outpatient activity is under performing by 2,263 attendances, this represents 10% of the overall contract. This significant variance is being investigated by the CSU. Financial performance is also under by 220k. The graphs below show how month 2 of 2016/17 compares to the last twelve months of activity and costs. Point of Delivery Note - this is based upon 2 months initial activity. Activity Cost Var Caused by: Plan Actual Variance Plan Actual Variance Activity Price '000 '000 '000 '000 '000 Outpatients 23,690 21,427 (2,263) 2,923 2,703 (220) (279) 59

8 3c. Acute Services SaTH A&E For the first two months of 2016/17 A&E activity is below plan by 449 attendances. Financial performance in this area is also below plan by 47k. The graphs below show how Month 2 of 2016/17 compares to the last twelve months of activity and costs. Point of Delivery Note - this is based upon 2 months initial activity Activity Cost Var Caused by: Plan Actual Variance Plan Actual Variance Activity Price '000 '000 '000 '000 '000 A&E 7,745 7,296 (449) (47) (50) 3 8

9 4. Non Acute Services Total Budget Forecast Outturn Forecast Variance Budget Actual Variance Community 24,827 24,530 (297) 6,207 6,078 (129) Mental Health 16,310 16,016 (294) 4,077 3,947 (130) Special Placements etc 8,847 9, ,309 2, Total Non Acute 49,984 50, ,593 12, YTD Variance by Major Spend Area Apr May Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar Community Mental Health Special Placements etc Key Messages The contract with Shropshire Community Trust is set at budgeted levels. This is the main area of expenditure in community spend which is predominantly a block contract arrangement. The CCG has changed the way it procures MSK care through a formal tender and this contract is monitored separately. The forecast on CHC and special placements reflects our agreement with the Local Authority to increase investment in CHC whilst tapering transitional payments to the Council. There is a risk around NHS ALD funding from the Council which has also been highlighted in the risks table in section 11. The contract with Staffordshire and Shropshire Mental Health Trust is a cost and volume contract and is showing a small underspend at Month 2 data. 9

10 5. Primary Care Services Total Budget Forecast Outturn Forecast Variance Budget Actual Variance Enhanced Services 1,236 1, (6) Out of Hours 2,447 2,318 (129) (34) Prescribing 29,311 29, ,276 7,248 (28) Primary Care Other 2,946 2,733 (213) (14) Total Primary Care 35,940 35,598 (342) 8,950 8,868 (82) YTD Variance by Major Spend Area Key Messages Over 80% of expenditure in this area relates to Prescribing. Month 1 NHS BSA data has informed the YTD financial position. The small underspend shown is due to the reversal of the 2015/16 prescribing creditor. It is important to note that the budget already takes account of the 730K QIPP target and therefore any underspend is over and above QIPP delivery. As we don t yet have any 2016/17 data, the forecast remains at plan. The position in Out of Hours is currently showing a slight underspend. The majority of this underspend relates to the 111 service Apr May Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar Enhanced Services Out of Hours Prescribing Other 10

11 6. Running Cost Allowance Budget Year to Actual Variance Area Corporate (40) Commissioning Finance (inc CSU) Nursing (7) Governance & Perform Key Messages The Running Costs element of the CCG allocation is currently showing a small underspend of 39k at Month 3. More detailed analysis can be found in Appendix 2. Due to the current changes in the CCG management team, running costs will be updated to reflect the agreed structure. Total (39) Pay (57) Non Pay

12 7. Recurrent cashable efficiencies based on contractual performance. The table below shows the current performance of our QIPP schemes that create recurrent cashable efficiencies. This data is based on current contractual performance. Transactional QIPP Total Annual NHS E Plan YTD Plan Amount m Actual YTD m YTD Variance m Forecast Actual Acute MH Services Community Health Services Primary Care Total Transformational QIPP Total Annual NHS E Plan YTD Plan Amount m Actual YTD m YTD Variance m Forecast Actual Acute Services MH Services Community Health Services Other Programme Services Primary Co Commissioning Total Unidentified Grand Total The table above shows that we are currently under performing year to date by approximately 550k and our forecast shows 0.1m shortfall against the original 5.85m plan. Our target QIPP plan still has an unidentified value of 400k. This is currently being addressed through the CCG Programme Management sub committee and a number of schemes were agreed to progress to the next stage at the June meeting of the committee. It is hoped that a number of these schemes can be brought on line during 2016/17 which will improve the above position. The current underperformance against existing schemes totals 450k at Month 3. This is in part due to the Primary Care Demand Management scheme slipping, which has now been signed off at Primary Care Committee. Also it is due to slippage within the PLCV with Blueteq scheme. Blueteq is being implemented and training is due to take place in July. 12

13 8. Statement of Financial Position The charts & narrative below highlight the key indicators from the CCG Statement of Financial Position or Balance Sheet. Cash Management Closing Cash Balance v Target Apr May Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar Maximum Balance Closing Balance The year to date cash position is summarised in the chart to the left. The target is to have a maximum cash balance at the end of each month of no more than 1.25% of that drawn down in the month. In June we achieved this target. Better Practice Payment Code (BPPC) Number Value NHS 98.4% 99.6% Non NHS 98.5% 95.9% Total 98.5% 98.7% The table to the left summarises CCG current performance against BPPC. The target is to pay 95% of all invoices (in terms of both volume and value) within 30 days of receipt. For Month 3, we achieved this target for value and volume for both NHS and Non NHS invoices. CCG finance have been regularly checking the invoices in the ledger and reminding budget holders of the need to approve invoices in a timely manner. Capital Resource Limit The CCG applied for a small capital allocation for 2016/17 of 42k. We are awaiting confirmation from NHS England that we will receive this allocation.. 13

14 9. Allocation Breakdown The table below shows our current allocation and adjustments that we have received in year. PROGRAMME ADMIN PRIMARY CARE TOTAL MONTH R NR R NR R NR R NR TOTAL '000 '000 '000 '000 '000 '000 '000 '000 '000 Initial CCG Programme Allocation April 205, , ,369 Initial CCG Admin Allocation April 3,773 3,773-3,773 Delegated Co-Commissioning Allocation April 22,576 22,576-22,576 Return of Surplus from 2015/16 April 2,668-2,668 2,668 Q1 Eating Disorder Service June ,369 2,758 3,773-22, ,718 2, ,476 14

15 10. BCF In 2016/17 the CCG makes a contribution of 11.99m to an overall pooled budget known as the Better Care Fund (BCF). The Local Authority contribute 2.26m leading to an overall fund of 14.25m. The fund is split into a number of areas and this is demonstrated in the table below. The financial position of the fund is monitored by a joint finance group and will be reported to PPQ on a monthly basis in the format below. Annual Year end Year end Summary Statement Forecast Forecast Budget Budget Expenditure Variance Expenditure Variance Intermediate Care 6,004,400 1,501,100 1,501, ,004,400 0 Community Resilience 1,283, , , ,283,321 0 Telford Neighbourhood Care 3,532, , , ,532,389 0 Other Care 3,432, , , ,432,564 0 Grand Total: 14,252,674 3,563,169 3,563, ,252,

16 11. Risks and Mitigations The risks that are currently inherent in our financial plan for the year are shown in the table below: Financial Risks Contract over performance- risk that activity at acute trusts will be greater than planned. System Management- risk related to the pressures of contributing/managing the whole LHE system rather than just the financial position of the CCG. Particular financial difficulties at Shropshire CCG and SATH. QIPP Delivery- risk that QIPP schemes will not deliver in year leading to a cost pressure. Local Authority- There is a risk that the Council may not pass on the full value of NHS ALD funding which we had in previous years. Specialised Services- Risk that the current exercise undertaken to split specialised services activity back to CCG level will incorrectly inform allocation adjustments and leave us with a cost pressure in future years. MsK- Last year the CCG revised care pathways and currencies through a formal tender for services. This service continues to be high risk and will be monitored closely throughout 2016/17. 1% NR headroom reserve- At the time of this report the CCG has been instructed by NHS England to hold the 1% NR headroom reserve of 2.7m as uncommitted. This presents a financial risk as the CCG would like to utilise this funding to support transformational schemes aligned to our QIPP programme and/or to support the regional STP as well as provide contingency for in year risks. Mitigations in place Ensure up to date contract information is presented to PPQ and Board as part of the finance report. Discussions with providers e.g. at contract meetings and finance and activity groups to highlight early warning signs of over performance through provider internal monitoring. Use of TRAQS data for up to date information on referrals. The CCG CFO will be discussing a year end settlement with SATH once we have a quarters data which should mitigate a large proportion of the risk around this. Ensure regular LHE dialogue between all organisations to ensure system wide understanding of financial gap and action plan, including risk sharing where appropriate, to achieve sustainability. This will be achieved through joint working around the STP and deficit reduction plan. QIPP will be monitored regularly at the QIPP sub committee. The QIPP programme is dealt with on a rolling basis so that schemes can be brought on line in year. On going executive level discussion to resolve. The CCG Deputy CFO will continue to attend the monthly specialised services finance work stream to ensure that we are involved in understanding the exercise that is being undertaken and that queries are passed through to both the regional and central teams. A detailed report to PPQ on the MSK service against a number of performance metrics will be presented on a regular basis. Regular dialogue with NHS England on how to bid for this funding 16