GOVERNING BODY Title of paper: Finance Update Month 4 Date of meeting: 5 th September 2018 Presented by: David Maloney Title: Chief Finance Officer & email contact: D.Maloney@nhs.net Prepared by: Nick Brown Title: Deputy Chief Finance Officer & email contact: Nick.Brown1@nhs.net Enclosure: J Agenda item: 14 Corporate Objective addressed by this paper (please select one or more with an X): 1. To commission safe, sustainable, efficient and affordable services to meet X the health and wellbeing needs of the population of Greenwich and reduce health inequalities with an additional focus on the urgent and emergency care system improvement along the pathway; 2. To ensure the CCG s position recovers to meet its financial and governance X duties and performance standards; 3. To nurture and support primary care to be resilient and thrive; X 4. To strengthen productive relationships with partners and the public to work X as a health and care system; 5. To actively engage with our communities to improve their experience of X healthcare; 6. To play an active and influential role in shaping SE London and London wide X commissioning. Purpose of the report: This report provides the year to date position to Month 4 2018/19. For the period the CCG has reported a surplus of 100k against its revenue resource limit; this reflects the planned position as at Month 4. The CCG is forecasting to deliver its planned surplus of 300k in year but in doing so will need to mitigate net risks of 6,663k. The CCG has now identified its QIPP target in full, 14,287k, which has a risk assessed delivery of 10.2m, 72.3%. Further details are provided within the Governing Body QIPP Report. Summary of Actions: The Governing Body is asked to note the financial position for the period April to July 2018 and in particular note the risks around delivery. Previous committee involvement: The Month 4 Finance report was discussed at the Financial, Performance and Quality Committee on 22 nd August 2018. 1
Recommendations to the Governing Body: The Governing Body is asked to: To note the budgets and position for the Programme Budgets and the Running Costs as at end of July 2018. To note the forecast position for the year for both Programme Budgets and the Running Costs. To note specifically the risk assessed forecast for the CCG s overall financial position; noting the drivers to this. (Please provide details below where Yes is indicated below) Impact on Governing Body Assurance Framework (x) Yes X No N/A Impact on Environment (x) Yes No X N/A Legal Implications (x) Yes No X N/A Resource and or financial implications (x) Yes X No N/A Equality impact assessment (x) Yes No X N/A Privacy impact assessment (x) Yes No X N/A Impact on current NHS Outcomes Framework areas (x) Yes X No N/A Patient and Public Involvement (x) Yes No X N/A Communications and Engagement (x) Yes No X N/A Impact on CCG Constitution (x) Yes No X N/A Attachments: Finance Update Month 2 2
CCG Finance Report 2018/19 Month 4 (Period to end of July 2018) Governing Body
Financial Performance Duties Duty YTD Target YTD Performance RAG Annual Target Forecast Performance RAG Achieve planned surplus (Expenditure not to exceed income) 100 100 300 300 Capital resource does not exceed the allowance Revenue resource does not exceed the allowance Capital Resource use on specified matters does not exceed the allowance Revenue resource use on specified matters does not exceed the allowance Revenue administration resource use does not exceed the allowance n/a n/a n/a n/a 140,767 140,667 425,894 425,594 n/a n/a n/a n/a n/a n/a n/a n/a 2,039 2,039 6,122 6,122 Page 2
Summary of Position at Month 4 The CCG was underspent at the end of Month 4 by 100k year to date (YTD). This is in line with the planned surplus to Month 4. The CCG is forecasting to meet it s annual target surplus of 300k. In Month the CCG has received Month 3 Acute Activity Reports, upon which its position is based. This information indicates increased pressure within the acute system which emphasises the need for the CCG to deliver its QIPP in full to mitigate escalating pressure in terms of elective and outpatient activity. The over main area of overspend is within Continuing Healthcare ( 1.1m), driven by an increase in high cost patients. The CCG is holding 4,235k of earmarked budgets and reserves, which include; 2,117k relating to the 0.5% contingency the CCG is required to hold 2,117k relating to the 0.5% planning reserve the CCG held as part of the planning round. The CCG is presently forecasting a risk assessed position of 6,663k. This assumes risks totalling 14m being offset by the CCG s reserves and utilisation of the Better Care Fund Contingency. This position reflects the impact of an increased pressure within the acute position. If the activity continues at its present trajectory the position is expected to be 5.7m worse than reported. Page 3
CCG Programme Budget Summary Programme Budget Annual Budget Variance to Month 4 Forecast Variance End of Year Risk Assessment 00 0s Acute Budget 198,399 (2,198) (5,155) (10,877) CCG Managed Acute Budget 21,804 781 2,340 2,341 Non Acute Commissioning 103,562 (218) (928) (2,001) Primary Care 72,388 437 324 300 Programme Budgets 17,792 69 (209) (234) Corporate Budgets 2,018 71 120 0 Unassigned QIPP (726) 0 (726) (726) Contingency 2,117 529 2,117 2,117 Planning Reserve 2,117 529 2,117 2,117 Planned Surplus 300 100 300 300 Total 419,772 100 300 (6,663) Prior Month for Comparison 418,936 75 300 (4,432) Note: a Red negative sign indicates budget overspend Page 4
Notes to Finance Position The Month 4 Acute position has been reported based upon an assessment of the Month 3 SLAM Reports, extrapolated to Month 4. This has shown an increase in activity at both Guys and Kings, with particular increases in the Kings Planned Care position. At Month 4 the CCG is forecasting a 1.1m overspend on Continuing Healthcare. This reflects an increase in costs associated with high cost patients. The Continuing Healthcare team is presently undertaking a review to identify mitigation to this position. PPA prescribing information is provided two months in arrears. The CCG position is therefore based on April and May activity. This indicates a reduction in prescribing costs in year, however due to the limited data set and the potential impact of mid-year price changes, the CCG will keep the position under review. Page 5
CCG Running Cost Summary 2018/19 Running Cost Budget Annual Budget Variance to Month 4 Forecast Variance End of Year Risk Assessment Running Costs 6,122 0 0 0 Prior Month (for comparison) 6,122 0 0 0 Notes: 1. The running cost allocation is separate from the Programme Budget and should be monitored separately. 2. The running costs budget is based on the 21.75 per head of population. Note: a Red negative sign indicates budget overspend Page 6
Financial Risks and Mitigations As outlined in slide 4, the CCG is facing a risk assessed position of 6,663k overspent. This is driven by the following key risks; Acute Contract Performance: The CCG faces a material risk within its acute contract position. The CCG has seen increased level of activity within its planned care position, with the main driver being the Kings contract position. Based on the contracted activity profile the ICDT would forecast a 10.8m overspend, 5.7m above the position reported at Month 4. The CCG has assumed that the present level of activity will not continue and that the CCG will be able deliver greater benefit from its QIPP and wider referral management approach in order to mitigate this pressure. Continuing Healthcare: One of the CCG s key focuses in its QIPP plan for 2018/19 is the Continuing Care Budget. The CHC team is continuing to work through the budget and put in place stronger management around the placements, however the present budget equates to a flat cash scenario. Due to increased LD CHC activity the CCG is presently forecasting an overspend of 1.1m, this assumes no further pressures and delivery in full of the CCG QIPP. Page 7
Cash Position The Maximum Cash Dawdown (After payments made on behalf of Greenwich CCG by NHS Business Services Authority PPA & HOT) is 395,404k. The actual and forecast drawdown of cash is shown in the table below; Proportion of CCG cash requirement Cumulative Proportion of Annual Cash Resource Limit Percentage of months completed in financial year % Variance based on 8.33% available per month Cumulative % Variance in 000s Cash Drawdown Monthly Draw down 000s Cumulative Draw down 000s Apr-18 35,500 35,500 9.0% 9.0% 8.3% 0.6% 2,563 May-18 32,000 67,500 8.1% 17.1% 16.7% 0.4% 1,626 Jun-18 30,300 97,800 7.7% 24.7% 25.0% -0.3% - 1,011 Jul-18 30,300 128,100 7.7% 32.4% 33.3% Total to date 128,100 Forecast Aug-18 32,200 160,300 8.1% 40.5% 41.7% -1.1% - 4,386 Sep-18 32,250 192,550 8.2% 48.7% 50.0% -1.3% - 5,073 Oct-18 32,250 224,800 8.2% 56.9% 58.3% -1.5% - 5,760 Nov-18 32,250 257,050 8.2% 65.0% 66.6% -1.6% - 6,447 Dec-18 32,250 289,300 8.2% 73.2% 75.0% -1.8% - 7,134 Jan-19 32,250 321,550 8.2% 81.3% 83.3% -2.0% - 7,822 Feb-19 32,250 353,800 8.2% 89.5% 91.6% -2.2% - 8,509 Mar-19 41,604 395,404 10.5% 100.0% 100.0% 0.0% 158 Annual Total 395,404 100% The CCG has drawdown cash in excess of its expected position to Month 4, this reflects quarterly payments being made to RBG, one off payments to Oxleas and the fact that the CCG is paying LGT at Contract Cap whilst it only has sufficient funds to pay the collar. This position is expected to recover once the contractual performance is agreed. Page 8
Better Practice Payments Code 2018/19 BETTER PAYMENT PRACTICE CODE 2018-19 Jun-18 Jul-18 NHS NON-NHS TOTAL NHS NON-NHS TOTAL NUMBERS FOR THE MONTH Total number of invoices paid in the month 246 611 857 315 576 891 Number of invoices paid within target 245 590 835 304 574 878 Numbers % for the month 99.59% 96.56% 97.43% 96.51% 99.65% 98.54% VALUES FOR THE MONTH ( 000s) Total value of invoices paid in the month 22,300 7,748 30,048 22,791 7,197 29,988 Value of invoices paid within target 22,300 7,732 30,032 22,859 7,072 29,931 Value % for the month 100.00% 99.79% 99.95% 100.30% 98.26% 99.81% CUMULATIVE NUMBERS TO THE MONTH Total number of invoices paid YTD 846 2,170 3,016 1,161 2,746 3,907 Number of invoices paid within target 835 2,120 2,955 1,139 2,694 3,833 Numbers % Cumulative 98.70% 97.70% 97.98% 98.11% 98.11% 98.11% CUMULATIVE VALUES TO THE MONTH ( 000s) Total value of invoices paid YTD 68,937 27,806 96,742 91,727 35,003 126,731 Value of invoices paid within target 68,918 27,392 96,310 91,727 34,464 126,241 Value % Cumulative 99.97% 98.51% 99.55% 100.00% 98.46% 99.61% Under the Better Payments Practice Code (BPPC), CCGs are expected to pay 95% of all creditors within 30 days of the receipt of invoices. This is measured both in terms of the total value of invoices and the number of invoices by count. The CCG has meet this target so far this year. Page 9
Revenue Resource Limit Admin Programme Total Initial CCG Programme Allocation - 416,939 416,949 Running Cost Allowance 6,119-6,119 2018/19 Opening Allocation 6,119 416,939 423,058 In Year Allocations (up to Month 4) 3 1,997 2,000 Month 4 Allocations 2018/19 Safeguarding Funding 70 70 Acute IR Changes 396 396 LeDeR Review Funding 60 60 LD Transformation Funding TCP 160 160 LD Programme Funding TCP 150 150 Total Confirmed Allocation to Month 4 6,122 419,772 425,894 Page 10
Budget The table below highlights the main movements in the budget in since the last report. Programme Budget Month 2 Budget Month 4 Budget Changes Acute Budget 198,002 198,399 CCG received expect funding following IR changes at Kings CCG Managed Acute Budget 22,604 21,804 QIPP Allocated Acute Budget 220,606 220,203 Non Acute Commissioning 103,524 103,562 Additional TCP co-hort + LeDeR Allocation BCF Funding moved to Programme Budgets Primary Care 72,688 72,388 0.3m indemnity budget moved to GPFV funding Programme Budgets 15,403 17,792 0.5m central allocations BCF Funding moved to Programme Budgets Corporate Budgets 2,018 2,018 Unallocated QIPP (1,526) (726) QIPP Allocated Contingency 2,117 2,117 Planning Reserve 2,117 2,117 Planned Surplus 300 300 Running Costs 6,122 6,122 Total 423,366 425,894 Page 11
Recommendations 1. To note the budgets and position for the Programme Budgets and the Running Costs as at end of July 2018. 2. To note the forecast position for the year for both Programme Budgets and the Running Costs. 3. To note specifically the risk assessed forecast for the CCG s overall financial position; noting the drivers to this David Maloney Chief Finance Officer NHS Greenwich CCG 5 September 2018 Page 12