Paper Finance Report. Month 11 (February 2016)

Size: px

Start display at page:

Download "Paper Finance Report. Month 11 (February 2016)"

Claude Hall
5 years ago
Views:

1 Paper 12.0 Finance Report Month 11 (February 2016)

2 Finance Report Month 11 (February 2016) Index Slide Executive Summary 2 Summary Financial Position 3 Key Variances 5 Reserves 7 Risks and Opportunities 8 Quality, Innovation, Productivity 9 and Prevention Balance Sheet and Cash 10 Run Rate into

3 million Financial Position In month there has been no significant change to the ytd position whereas forecast is now showing an improvement against 15/16 plans of 2.4m, an improvement of 1.4m against M10 forecast by fully releasing remaining reserves which are no longer required due to proximity of year-end. Acute provider expenditure is showing a net 9.4m (3.8%) over spend against agreed contract values. Pressures are also being seen in non-acute areas (e.g. Continuing Care, integrated equipment, community providers) and estates. The overspends have been substantially offset by unrequired 14/15 balances ( 3.4m), use of surplus funds( 5.2m), Quality Premium ( 0.4m) and Better Care Fund ( 0.9m) uncommitted budget. Revenue Resource Limit (Income Allocation) Resource limit at month 11 is 444.4m which incorporates the 11m reduction for cumulative deficit bought forward from previous years. CCG received additional allocations of 3m in month 11 for BEH Clinical Strategy and Royal Free Transaction costs. Summary QIPP Position QIPP schemes are reported as delivering 13.6m (improvement of 1.2m) against forecast plan. The 1.1m slippage against acute and estate schemes is currently supported by non-recurrent measures. Reserves Original plans set aside a general reserve of 4.4m (1%) against acute and other service pressures. This had increased to 9.6m (+ 5.2m), reflecting surplus budget provision as contracts and budgets were finalised. To offset overspending in acute contracts, the 5.2m additional reserves has been released in earlier months. Of the original 4.4m, 0.6m has been set aside for additional investment in patient care, 0.7m utilised to mitigate estates overspend and the 3.1m balance released given the reduced risks. Executive Summary 0 ( 1) ( 2) ( 3) ( 4) ( 5) Cumulative Position (incl. 11m deficit bought forward from previous years) April May June July Aug Sept Oct Nov Dec Jan Feb Mar Corporate Costs Release of 1.5m reserves in month 12 Planned cumulative Actual cumulative Forecast Overall corporate costs are forecasting a 0.6m underspend. Estates overspend is offset by slippage on QIPP re-provision costs and prior year benefits. Running Cost Allowance (RCA) RCA is expected to be show an underspend of 0.4m due to Quality Premium received in Month 9 but is not expected to be spent. Balance Sheet and Cash Balance sheet and cash position have no issues of concern 2

4 Summary- Full Year Forecast Recurrent Variance Non- Recurrent Variance YTD Full Year Bud Actual Var Var Bud FOT Var Var m m m % m m m % Revenue Resource Limit less prior year deficit /16 Resource Net Acute Forecast (8.2) (3.6)% (10.5) (4.3)% Net Non Acute Forecast % (0.2) (0.1)% Net Corp Forecast % % Reserves 5.3 (0.0) % % Total Recurrent Movement (2.7) (0.7)% (1.0) (0.2)% Acute Spend (RTT) (0.0) (2.6)% (0.1) (2.7)% NCL Risk Pool CHC Legacy Prior Year Accruals 0.0 (3.4) (3.4) Total Non-Recurrent Movement % % Total Expenditure % % Reported Surplus / (Deficit) (3.7) (3.0) % (4.0) (1.6) % Prior year adjustment (9.2) (9.2) - - (11.0) (11.0) - - In Year Suprlus / (Deficit) % % Both YTD and forecast are now showing better than planned position. Forecast is showing pressure in acute service expenditure, especially around Non Elective admissions and QIPP slippage. 5.2m surplus reserves, over and above original plan, have been released to offset the above pressures. Of the original planned reserves ( 4.4m), FPQ agreed additional investments totalling 1.7m and a further 0.7m has been released to support estates pressures. The remaining 2m has now been fully released as it is considered as no longer required. 3

5 Key Issues and Movements from Month 10 Reported Forecast. Issues Data Quality Data submission from RFL is considered materially complete and has been used to prepare month 11 reports. A rectification plan was submitted following data submission issues in previous months. Whilst RFL has indicated that it has addressed the reporting issues, which on first review would appear to be the case, CSU will work with the Trust to confirm. Month 9 data is now frozen, with the CCG gaining more certainty around the financial value reported. Month 11 RFL reporting still includes a degree of estimation. The CSU, in conjunction with CCG, continue to adjust the Trust s submitted SLAM activity/costs for elements not yet reflected in SLAM. Adjustments are based on best estimates of the likely impact. Examples would be an assessment of penalties and success rate of outstanding challenges. RTT any additional RTT activity at RFL is included in the SLAM data provided but has been removed and set against the CCG s specific RTT budget. A 2015/16 RTT contract variation has been signed and RFL is now reporting historic backlog RTT separately. Any RTT additional activity elsewhere at other providers is shown against the respective providers contract position. Material changes compared to Month 10 report Prescribing as reported previously, prescribing forecast is potentially subject to material fluctuations through changes to profiled spend and national pricing adjustments which usually occur around month 10 reporting. Latest PPA data is showing an adverse movement in expenditure resulting in a 0.3m deterioration ytd and 0.6m deterioration to FOT compared to month 10 position. QIPP forecast has further improved by 1.2m on month 10, primarily through reduced re-provision requirements and expenditure) and hence requires less non-recurrent support to the CCG s overall position. The improvement has assisted in offsetting the deteriorating position in the acute contracting position. All reserves have now been released, the benefit being reflected in the forecast outturn. 4

6 NCAs SLA Exclusions Winter Pressures Moorfields Barts UCLH Royal Free London - BCF Site Royal Free London - RF Site '000 3,000 2,000 1,000 0 (1,000) (2,000) (3,000) (4,000) (5,000) (6,000) Acute - Key Variances Acute Key variances from Plan Royal Free London :- Forecast Outturn is based on the M10 submitted data, which is materially correct. The remaining technical issues can be handled through the Contract Technical Group. The main areas of assessed risk continue to be over performance in Critical Care, Elective and Non Elective activity continuing the activity trends established in previous months. Moorfields, an increase in Elective activity has increased the forecast overspend at M10. The activity over performance continues to be in day cases and Out patient procedures as previous months. BARTs FOT has decreased at M11 as a result of increased financial adjustments for challenges to reflect the current year end deal offer by the Trust. The total over performance arises from higher activity than planned in critical care and non elective activity. Underspend in SLA Exclusions is due to release of anticipated prior year costs no longer payable. NCAs:- the under spend is from lower volume of invoices and an unexpected prior year benefit for TB Service. Resilience (Winter) Pressures: some slippage on schemes is being seen ( 0.4m). 5

7 '000s Community Services Community Services Other: The surplus mainly arises from uncommitted Better Care Fund ( 0.8m FOT) released to cover the acute non elective reduction not being met. A further 0.4m (FOT) relates to a prior year benefit from finalising CLCH CQUIN. Continuing Care The FOT is reporting cost pressures of 1.1m, similar to last month s reported position. The cost pressure is in part offset by prior year benefit of 0.3m (FOT). Mental Health & Learning Disabilities Learning Disabilities: There are now five high cost placements, compared to eight at the start of the year, resulting in the reported benefit. Slight adverse change compared to month 10 reporting is due to increase cost of one patient. Mental Health NCA & Other: Surplus is mainly due to uncommitted 15/16 MH investment 0.4m. No significant variances to report in all other areas of mental health. Non-Acute - Key Variances 1,500 1, (500) (1,000) (1,500) Non-Acute Key variances from plan Primary Care Prescribing: Whilst the YTD is reporting close to plan, the Forecast is reporting a cost pressure of 0.2m. This is an adverse movement of 0.6m due to FOT provided by PPA being greater then projected at M10 ( 0.2m), prior year under accrual ( 0.2m) and a provision for increased expenditure for M11 and M12 ( 0.2m) 6

Original 4.4m Reserves plus additional risk mitigation ( 15.

7m 5.2m 2.7m 5.2m 1.7m 1.1m 0.6m 3.4m (prev month 3.7m ) 2.

7m Reserves and Provision released into Forecast Outturn Description Reason Released to Forecast I&E

5,243 Original Reserves Overspend on Estates plus uncommited budget 2,700 Investment from Reserves BCF

8 Original 4.4m Reserves plus additional risk mitigation ( 15.2m) Reserves & In Year Benefits Key Remaining mitigations ( 1m) and utilized ( 14.2m) in forecast 2.7m 5.2m 2.7m 5.2m 1.7m 1.1m 0.6m 3.4m (prev month 3.7m ) 2.1m Released into Forecast Outturn Committed into Forecast Outturn 3.4m 0.4m 1.7m Reserves and Provision released into Forecast Outturn Description Reason Released to Forecast I&E '000 Additional reserves from contract finalisations Released against increased run rates etc. 5,243 Original Reserves Overspend on Estates plus uncommited budget 2,700 Investment from Reserves BCF Scheme for Non-Elective Admissions 1,109 Prior year accruals (general) Release of 14/15 accruals no longer required 3,446 QIPP re-provision costs Slippage on QIPP re-provision 1,732 Balance of Uncommitted Reserves/Provisions 14,230 7

9 Risks Risks & Opportunities to Forecast Opportunities The remaining significant risks and anticipated likelihood of materialising that are as yet not reflected in the financial forecast are: Risks % m Run rates on acute contracts outstrip original planning assumptions and current run-rates. Volatility across some high cost areas e.g. critical care. Risk reduced from last month given proximity of year end Potential opportunities and likelihood that they may materialise in mitigating risks and not yet reflected in the financial forecast are: Opportunities % m Reserves held against activity pressures and unforeseen expenditure. Note reserves now fully released General unanticipated expenditure across various lines e.g. high cost placements and continuing care, community equipment etc Prior Year accruals:- 3.4m secured so far, nothing further expected Prescribing possible upward pressure over winter General underspends:- across various areas (QIPP reprovision, slippage on in-year investments) QIPP further slippage on schemes Estates new: unexpected invoices from CHP recently received. Being investigated Total Risks 1.2 Contract Discussions options to agree year-end positions with providers being explored Total Opportunities 2.5 Previous risks around Primary Care Co-commissioning, Better Care Fund non-delivery of non-elective admissions target are now reflected in the forecast position and are currently not considered as further risks. As more prior year benefits are secured, opportunity for further benefits reduces. Latest assessment of investments suggests some further slippage may be occurring. Opportunities assessed to exceed risks which, if secured, may improve year-end position beyond that currently forecast. 8

10 Summary QIPP Position Month 11 - Year to Date Full Year 2015/16 Plan Actual Variance Recurrent Plan Forecast Variance % % Acute Royal Free 3,747 2, % 2,843 4,087 3, % Barnet and Chase Farm 4,129 4, % 4,764 4,504 5, % University College London % 741 1, % Other 559 1, % 1, , % Sub-total 9,381 9, % 9,615 10,123 10, % Non-Acute CLCH % % BEH MHT % % Primary Care Prescribing 1,050 1, % 1,227 1,140 1, % CHC and High Cost Placements % % Other % % Sub-total 2,772 2, % 2,307 3,022 2, % Corporate Estates 1, % 608 1, % Other % % Sub-total 1, % 608 1, % Total 13,444 12, % 12,530 14,645 13,577-1, % Non Recurrent Savings 914 1,068 Grand Total 13,444 13, % 12,530 14,645 14, % Forecast at 13.6m is a 1.2m improvement on month 10. Primarily due to re-provision budget considered no longer required. The data indicates an improved position in Integrated Care QIPP delivery, compared with previous available data set (month 8). Prudent approach to forecasting has been undertaken for Integrated Care as this activity will be expected to increase in quarter 4 Estates and Corporate has begun to slip year to date as the planned drive to increase utilisation of Westgate House has not been achieved. Higher than expected CHP charges for Finchley Memorial Hospital has resulted in a significant slippage on Estates QIPP. This has led to a substantial forecast variance. Acute outpatients and elective care schemes are delivering at planned levels. The Referral Management Service continues to be a vital tool enabling the CCG to deliver efficiencies by managing demand for acute secondary care. The overall slippage on QIPP is being supported by non-recurrent savings of 0.9m YTD and Forecast of 1.1m. 9

11 Cash & Balance Sheet Barnet CCG Cash position and forecast Year To Date Forecast Position as at 29th February 2016 Month 11 Full Year RECEIPTS Balance bfwd NHSE Drawdown (Inc Supplementary) 348, ,738 Other - Inc VAT 7,629 7,779 CHC Risk Pool 2,481 2,707 NHSBSA Prescribing 45,634 49,902 TOTAL 404, ,269 PAYMENTS Creditors 347, ,925 Salaries & Wages - Inc Tax & NI 4,214 4,592 CHC Risk Pool 2,481 2,707 NHSBSA Prescribing 45,634 49,902 TOTAL 399, ,126 BALANCE CFWD 4, The Maximum Cash Drawdown (MCD) for 2015/16 is currently confirmed as 440.4m. This assumes a forecast under utilisation of 7.0m notified to NHSE in the month 9 exercise. Furthermore another 4.0m of cash will be returned to NHSE in March Barnet CCG Statement of Financial Position Actual Actual Actual Actual Actual Forecast Position as at 29th February /15 Qtr 1 Qtr 2 Qtr 3 Month 11 Qtr 4 NET ASSETS Debtors 5,567 5,786 5,409 7,010 2,847 3,678 Cash and Cash Equivalents 18 5,476 (2,650) 261 4, Trade and Other Payables (41,770) (48,613) (50,500) (50,290) (51,571) (52,586) TOTAL ASSETS EMPLOYED (36,185) (37,351) (47,741) (43,019) (44,140) (48,808) Debtors have reduced recently due to invoices raised for Q1 & Q2 recharges to LB Barnet now being settled. Trade and other payables continue to be higher than planned as some in-year monthly SLA contract payments are being part-paid or withheld pending validation and resolution of contract notices. Estates invoices are also held at present. Creditor balances will reduce once these issues are resolved. 10

12 millions Plan (in-year) Run Rate into Next Year (2016/17) Summary In-year movements m reported in year improvement 9.3 Remove NR Initial in year 16/ in year plan was 7m surplus Forecast is 9.3m (+ 2.3m) surplus But surplus supported by one off benefits offsetting other pressures, nonachievement of QIPP etc. Rolling over spending would give 6.7m in-year surplus 11

Paper Finance Report. Month 9 (December 2015)

Paper Finance Report. Month 9 (December 2015) Paper 16.0 Finance Report Month 9 (December 2015) Finance Report Month 9 (December 2015) Index Slide Executive Summary 2 Summary Financial Position 3 Key Variances 5 Reserves 7 Risks and Opportunities