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Paper 19/12b 31 January 2019 Page 1 of 12 Oxfordshire Clinical Commissioning Group OXFORDSHIRE CLINICAL COMMISSIONING GROUP BOARD Date of Meeting: 31 January 2019 Paper No: 19/12b Title of Paper: Finance Committee Minutes, 22 November 2018 Paper is for: (please delete tick as appropriate) Discussion Decision Information Conflicts of Interest (please delete tick as appropriate) No conflict identified Conflict noted: conflicted party can participate in discussion and decision Conflict noted, conflicted party can participate in discussion but not decision Conflict noted, conflicted party can remain but not participate in discussion Conflicted party is excluded from discussion Purpose and Executive Summary: The Committee draws to the attention of Board members, the following: Value for Money Metrics: VFM metrics are be discussed in more detail at the next Finance Committee meeting. HART Service: The Committee noted that the service performance had improved but there was still a material cost pressure for OCCG. The number of additional short-stay beds to mitigate the contract performance required further quantification. The Committee requested a high-level report to establish whether there were still duplicate costs for OCCG in the local health system. 2019/20 Annual Operational Plan and Budget: The first high level planning submission is due on 14 January, which focuses on activity and savings plans. In terms of planning, there are significant unknowns in relation to allocations and tariff arrangements. The Committee discussed the strategic approach to the next contract round. Month 7 Finance Report: The CCG is reporting that it is on plan to deliver its control total, although it is still carrying a net c£4.0m of financial risk that is not mitigated in full if it crystallises. The aim is to further mitigate the net risk by continuing the Financial Recovery Programme (FRP) actions agreed by the Committee. The Oxford University Hospital Trust (OUH) shows a performance of £1.7m

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Page 1: Oxfordshire Clinical Commissioning Group OXFORDSHIRE ...€¦ · Oxfordshire Clinical Commissioning Group OXFORDSHIRE CLINICAL COMMISSIONING GROUP BOARD Date of Meeting: 31 January

Paper 19/12b 31 January 2019 Page 1 of 12

Oxfordshire

Clinical Commissioning Group

OXFORDSHIRE CLINICAL COMMISSIONING GROUP BOARD

Date of Meeting: 31 January 2019 Paper No: 19/12b

Title of Paper: Finance Committee Minutes, 22 November 2018

Paper is for: (please delete tick as appropriate) Discussion Decision Information

Conflicts of Interest (please delete tick as appropriate)

No conflict identified

Conflict noted: conflicted party can participate in discussion and decision

Conflict noted, conflicted party can participate in discussion but not decision

Conflict noted, conflicted party can remain but not participate in discussion

Conflicted party is excluded from discussion

Purpose and Executive Summary: The Committee draws to the attention of Board members, the following: Value for Money Metrics: VFM metrics are be discussed in more detail at the next Finance Committee meeting. HART Service: The Committee noted that the service performance had improved but there was still a material cost pressure for OCCG. The number of additional short-stay beds to mitigate the contract performance required further quantification. The Committee requested a high-level report to establish whether there were still duplicate costs for OCCG in the local health system. 2019/20 Annual Operational Plan and Budget: The first high level planning submission is due on 14 January, which focuses on activity and savings plans. In terms of planning, there are significant unknowns in relation to allocations and tariff arrangements. The Committee discussed the strategic approach to the next contract round. Month 7 Finance Report:

The CCG is reporting that it is on plan to deliver its control total, although it is still carrying a net c£4.0m of financial risk that is not mitigated in full if it crystallises. The aim is to further mitigate the net risk by continuing the Financial Recovery Programme (FRP) actions agreed by the Committee.

The Oxford University Hospital Trust (OUH) shows a performance of £1.7m

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above the activity plan at Month 6 after allowing for financial and technical adjustments, an improvement of £0.3m on the previous position reported. The primary drivers of the over-performance were Non-Elective (including Same Day spells), high cost drugs and outpatients.

Elective in-patients and day cases activity levels remains of concern due to the OUH’s waiting list issues. The Committee received an update on the Trust’s additional capacity plans, which come into place from October.

The contract issues with Oxford Health NHS Foundation Trust (OH) have not yet been finalised and this continues to represent a risk. OH, has moved to a forecast deficit position, which had been agreed with NHSI at Q2.

Forecasts for the Better Care Fund and Non-Contracted Activity have deteriorated again this month and the Committee received a detailed update and considered the action to be taken.

The CCG has committed £6.0m (£5.3m at Month 6) of the risk reserve and the entire 0.5% contingency (£4.4m) into the forecast position to offset activity pressure. £0.8m of the risk reserve remains.

The Committee received a detail update on the FRP, with the focus on the Activity Management Plan and the OUH forecast position.

The Oxfordshire system had an underlying deficit of approximately £40.0m moving into the 2019-20 planning round.

Section 75 Performance – dashboard review: The Committee reviewed several areas of cost pressure in the Better Care Fund, where the outturn forecast had moved from £2.9m deficit to £4.0m. The pressures relate to the care home budget and a forecast £0.8m overspend on support at home for the over 65s’. OCCG will work with OCC to understand the drivers for the in-month deterioration of the budget forecast.

Engagement: clinical, stakeholder and public/patient: Not applicable in the context of matters reviewed at this meeting. The Committee would expect engagement to be considered as part of any Executive Committee plans to come forward to the Board in relation to actions to be taken to address activity over-performance. Savings schemes require full Quality Impact Assessments as part of the governance arrangements, which would be considered by OCCG’s Quality Committee. Further assurance is required. As previously reported, there has been good clinical engagement in the Financial Recovery Programme and all key decisions have be taken by the Board at meetings in public.

Financial Implications of Paper: The CCG is forecasting it will meet its control total for 2018/19 but based on the risk assessment at month 7, without additional benefits delivered through the Financial Recovery Programme in the final 5 months of the year, the CCG will overshoot its control total by c£4m if the identified risks to the plan crystallise. The CCG is not on trajectory to deliver its elective waiting list target at March 2019

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and management action and investment is required to commission additional activity.

Action Required: The detailed work of the Finance Committee provides further assurance to the Board that OCCG is managing its finances effectively and in accordance with the financial plans and budgets approved by this Board. Board members are asked to consider if they are receiving sufficient information in the Board’s finance report and through the minutes of Committee meetings to assure themselves in relation to OCCG’s financial performance.

OCCG Priorities Supported (please delete tick as appropriate) Operational Delivery

Transforming Health and Care

Devolution and Integration

Empowering Patients

Engaging Communities

System Leadership

Equality Analysis Outcome: Not applicable in the context of the matters under review at this meeting.

Link to Risk: AF25, there is a risk that cost pressures against OCCGs allocation will lead to non-delivery of OCCG's statutory financial duty and NHSE business rules for CCG's: OCCG has implemented an in-year Financial Recovery Plan to mitigate the over-performance on acute hospital contracts. 761, there is a risk that further savings are required: The CCG is forecasting to deliver the 2018/19 Savings Plan target in full and the Financial Recovery Plan is in place. 762, the financial reporting information from OCC hosted pooled budgets is subject to too much uncertainty and variability which creates a risk that effective management action cannot be taken or is sub optimal and this may lead to financial losses: The CCG has commissioned its Internal Auditor to undertake a review to support the strengthening of the governance of the pool and systems of control (Report January 2019). Financial risk sharing agreements are in place.

Author: Duncan Smith, Lay Member, Chair OCCG Finance Committee.

Clinical / Executive Lead: Gareth Kenworthy, Director of Finance.

Date of Paper: 22 January 2019

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Oxfordshire

Clinical Commissioning Group

MINUTES:

Finance Committee

14.00 – 16.30, 22 November 2018

Room 4, Jubilee House

Present Duncan Smith

Lay Member for Finance - Chair

(DS)

Roger Dickinson

Lay Vice Chair (RD)

Jenny Simpson

Deputy Director of Finance (JS)

Gareth Kenworthy

Director of Finance

(GK)

Diane Hedges

Chief Operating Officer and Deputy Chief Executive

(DH)

Dr Ed Capo-Bianco

Locality Clinical Director South East Oxfordshire

(ECB)

Presenters Julia Boyce Assistant Director of Finance (JB)

Julie Dandridge Deputy Director, Head of Primary Care and Localities (JD)

In Attendance Caroline James Minute taker (CJ)

Apologies Louise Patten

Chief Executive Oxfordshire CCG (LP)

1. Declarations of Conflicts of Interest Pertaining to Agenda Items RD declared an interest in Paper 9 – Business Case Hightown Practice (Longford Park) Confirmation of meeting quorum The Chair declared the meeting quorate.

2. Minutes of the Meeting held on 25 September 2018 The minutes of the meeting held on 25 September 2018 had been signed off and submitted for the next Board meeting.

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Action Tracker VFM metrics would be discussed in more detail at the next Finance Committee meeting. GK, however, assured the meeting that progress was being made and that a draft outline would be developed. This would be added to the committee’s workplan. Action: GK to present update to next meeting of this committee Action: CJ to add VFM Metrics to workplan 18.09 NHS Constitution targets and Integrated Performance report This item was on the agenda and would be discussed later in the meeting. 18.10 HART Service DH explained that paper 11 submitted to the meeting was a Quality Committee paper so extra costs had not been shown but high level costs would be prepared for the Board. It was noted that the HART Service had improved performance but there was still a material cost pressure for OCCG. The short stay beds required further quantification but it was thought that the number was 131. DH would produce a high level report to establish whether there were any duplicate costs for OCCG in the local health system. Action: DH to review short stay bed numbers and identify any duplicate costs. 18.16 Delegated Co-Commissioning A summary of the delegated budget was circulated prior to the meeting that set out the discretionary /non-discretionary elements. The Committee noted that the majority of the budgets were not discretionary. The action to be closed.

GK CJ

DH

3. Performance Annual Operational Plan and Budget GK explained that that the detailed requirements for planning for 2019-20 had not yet been issued although a joint letter on the Planning Approach for 2019-20 had been received from NHSE/I. The detail is due in mid-December 2018. The first high level planning submission is due on 14 January which would focus on activity and savings plans. In order for Finance Committee members to be fully informed of NHSE guidance, GK would provide a summary of the headlines. Action: GK to provide an outline summary before 18/1/19. There are significant unknowns for 2019-20 allocations for CCGs and tariff arrangements have not been published, so there is concern that the audit trail will not be clear. The focus would be on the total funding for the area and agreement of a control total for Oxfordshire. This would facilitate mitigation of financial risk.

GK

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Month 7 Finance Report including Lucentis to Avastin benefits realisation JS introduced the paper. The CCG is still reporting to be on plan with a net risk position at £4.0m. It is possible that the net risk position may be reduced at Month 9. A new Appendix had been added this month (Appendix 7) which shows the financial position for the key partners to the ICS i.e. OUH, OH and OCCG. This will be included every month from now on but the detail will be a month in arrears. An Appendix had been included this month reporting the latest financial implications for High Cost Drugs – Avastin and Adalimumab. The Medicines Management Team estimate monthly savings of £238k in relation to Adalimumab from December, with further savings possible from active moving of suitable patients to this drug. A gain share will be discussed with OUH. It is not currently expected that there will be savings from the use of Avastin in the current financial year but may be possible in future years. The Month 7 run rate had been impacted on by an issue with the previous months YTD reporting and so the Committee were advised to take an average of Month 6 and 7. The trend is then in line with prior months. The largest changes to forecasts were NCA activity, which requires further investigation and the Better Care Fund. Action: NCA spend to date and process to be reviewed by CSU Finance team and CCG Urgent care team (budget holder) to inform future reporting

GK updated the Committee on the OUH position and the latest forecast including contract challenges:

OUH would be outsourcing T&O and gynaecology activity to Ramsay Horton in order to reduce waiting lists.

It is planned that some gynaecology cases would be outsourced to Royal Berkshire Foundation Trust (RBFT) but this was proving difficult in practice.

The OUH has also contracted with an insourcing company to deliver further capacity to address waiting lists. OUH had opened theatres at weekends in order to support the 18-week RTT and bring the waiting lists down towards the agreed targets.

As a result of this initiative, elective procedures were up by 200 – 300 per month in October, equating to a 10% increase in activity.

The waiting list had dropped towards the target and a waiting list validation exercise was also taking place.

DS queried performance at the Ramsay Horton, which did not seem to show the extra T&O activity. GK explained that this was due to the contractual arrangements between the parties and outsourcing activity

JS

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would not be included in the OCCG/Ramsay contract, they would be seen as extra activity within the OUH contract and attributed to OUH. GP referrals to Ramsay Horton were down on the contracted numbers. There would be ‘winter pressures’ on NEL activity and OUH had already highlighted that it did not have the bed capacity to deal with this. Extra beds would be required within the system, hence there was a requirement to source additional short-stay beds. There would need to be negotiations on funding of the extra capacity. Same day spells were also discussed and would need to be taken into consideration in the 2019-20 baseline. Much of this activity was considered to be genuine ambulatory care, where patients were admitted to the acute setting in order to carry out further tests. It was unclear how many patients had ambulatory care follow-up appointments as these were not clearly identified. A casemix NEL audit would be undertaken in order to facilitate a clear baseline for future discussions. There was concern expressed regarding the pooled budgets and risk share arrangements. There is a net additional in-year risk to OCCG of c£300k of the revised agreed risk share arrangements. CHC was an issue of concern, as there were 50 extra clients who were being supported in 2018-19 compared to the previous year and the referral rate was rising at a steady rate. DS expressed concerns on the accuracy of activity reporting in this area. DH informed the meeting that Rachel Pirie had been employed by OCCG as a joint post for Older Peoples Commissioning with Oxfordshire County Council. Rachel would be identifying best value for money in the system. A CHC placement was currently £1,500/week against a County Council care home place of £800/week. Action: DH to draw up an action plan for CHC to include actions and outcomes. Oxford Health (OH) has moved to a forecast deficit position, which had been agreed with NHSI at Q2. There would be no extra in year funding but this would be a challenge in the next planning round for the ‘system’ to address with the Trust. A process would be agreed for handling this performance issue. GK reported that the Oxfordshire system had an underlying deficit of approximately £40m moving into 2019-20. GK would be working towards a negotiated year-end deal with OUH. Action: GK to work towards end of year deal with OUH with a risk net zero profile and to review baselines and casemix for 2019-20. The M7 Finance report was noted.

DH

GK

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High Level ‘first cut’ and key assumptions 2019-20, contract approach 2019-20/Commissioning Intentions GK introduced the letter from Louise Patten to all Oxfordshire System Chief Executives. DS requested that there should be some assurance to the Finance Committee in the form of either minutes of the ICB meeting or the summary report which is sent to the Health and Wellbeing Board. RD would review the Terms of Reference for the ICB Committee in respect of sharing of information to determine the best form of assurance. Action: RD to review ToR ICB Committee regarding information sharing. RD requested further explanation on the high local use of specialist services referred to in the correspondence. GK identified two main issues. There was a counting issue, as when benchmarked, more procedures were counted as specialist and as there were more specialist services available locally, it was possible that more patients were being treated. ECB explained that there was more sub-specialism in the local area due to the availability of clinical expertise. It was noted that there were no system levers for OCCG as the specialised commissioning services were overseen by NHSE. In the future, it was thought that these services would move to OCCG and as such would become a future financial pressure, which was already being considered in the STP development plans. RD considered that the letter was a move in the right direction. He stated that there was a need for common reporting and proposed a joint committee for consistency of decision making. He reported that there would be a local meeting of CEOs, NEDs and Lay members on 23 January 2019, where it may be appropriate to move these discussions forward. It was noted that the Oxfordshire ICS would be shadowing for one year, in which time suitable area contracts and risk sharing arrangements could be developed. EDS would share a copy of the presentation by NHSE to the HFMA, including the six key criteria for moving to an integrated care system. Action: All to review letter and send any comments to GK. Action: DS to distribute the HFMA presentation. The Committee welcomed Louise Patten’s letter to the Oxfordshire providers as a basis to develop the ICS approach for 2019-20. Section 75 Performance – dashboard review JB introduced the paper. JB highlighted a number of areas of concern including a projected year end overspend of £420,000 in the adults pooled budget. This appeared to be due to extra high cost clients requiring one to one care. JB

RD

All DS

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explained that in order to qualify for this level of care, a multidisciplinary panel met to approve individual cases. It was noted that there was a new contract of £235,000 in place for Asperger’s patients but this was a block contract without the ability to split the data in types of assessment. There had been an issue with OCC counting and reporting of CHC nursing home caseload in the M5 and M6 reports. The monthly snapshot showed that there were 14 new at home CHC patients, with 2 deaths in M6. As this was for clients under 65 years old, further investigation was required. It was stated that Rachel Pirie was working on an Approval of Care Policy to be sent to the OCCG Executive Team. It was noted that there was an under-spend in Funded Nursing Care. JB also reported that there had been an over-spend on equipment. Further work was required on this. Action: JB to follow-up on reasons for equipment over-spend

JB

4. Financial Savings and Risk OCCG Risk Register The update was noted. AF25 - GK reported that as the year progresses this risk reduces but would rise again in the next commissioning cycle. 672 – There were reporting issues in this area and these would be identified in the ongoing audit report. Primary care estates was identified as an operational risk. AF25 – There was a fall-back position for OUH but a separate risk may require identification for 2019-20. It was thought that the Audit Committee would be taking an overview of the risks of moving to an Integrated Care System. OCCG Savings Plan GK introduced the paper. Planned Care was designated ‘amber’ as there may be higher activity as the Orthopaedic back-log was being addressed, hence resulting in a greater spend on this than predicted in year. For 2019-20, there was a draft savings plan for £25m which would be shared with the Program Boards.

5. Estates

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Primary Care Estates – Financial Implications of demographic growth on primary care estate JD introduced the paper. The Finance Committee was asked to note the prioritised tactical delivery plan for Primary Care estate, current priority proposals and the potential implications on OCCG’s revenue budget. The Committee noted that there would be a number of areas where new build or expansion was needed and although this could be covered by the budget for the current projects, there was a further need to invest at least £1.0m per year in the budget in terms of increased rent reimbursement. The priority projects were Bicester, Hightown, Wantage, and Didcot, followed by Kidlington, Oxford City and Witney. These were all included in the estates £3.5m financial envelope identified in the initial work. Future expansions would require Board approval, as the investment required could not be found within the existing delegated budgets. JS confirmed that the Bicester and Banbury schemes could in theory be covered by delegated funds but there is a cost pressure beyond this. Bicester Estates Bid JD introduced a costed options appraisal. This had not been reviewed by the Executive Committee at this point. The Committee resolved to support the Bicester Practices to develop their estate in order to provide primary care services to the growing population. The Committee notes that any decision will be subject to a full business case, a value for money assessment by the District Valuer and further patient engagement. A business case would need to be approved to include additional costs of c£120,000. Hightown (Longford Park) RD declared an interest in this paper as he is registered at this Practice. The Committee resolved that he could remain in the room but not take part in the decision. JD presented the business case. It was noted that this had not yet been considered by the Executive Committee. The Committee resolved to support the business case for submission to NHSE.

6. Services NHS Constitutional targets including IPR DH introduced the paper. The report was noted. It was requested that

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the report be made to the Finance Committee twice a year to highlight any financial impacts. HART Service Report This had been previously discussed under the Committee Action Log. The Committee would place reliance on the Quality Committee in terms of the quality of service delivered. It was noted that the activity reports used data supplied by Oxfordshire County Council, which may not be as robust as other system data sources. DS expressed concern that the report to the Quality Committee made no mention of the ‘hidden’ domiciliary waits, which were capture in the Pooled Budget Performance Dashboard. The Committee agreed that there needed to be links between the delayed transfer of care report in the IPR report and the HART waiting times in order for the data to be more meaningful. Action: DH to obtain assurances of the numbers in order for this to be used as a system-wide demand and capacity management tool.

DH

7. Workplan The Workplan was reviewed. The following were to be added:- IPR 19/20 Financial Allocations 19/20 Savings Plan

CJ

8. Meeting review DS stated that all items on the agenda had been covered and there had been a wide range of topics covered. It was noted that the quality of the papers received had improved from last year.

9.

9.1

9.2

Any Other Business CCG Activity by Locality Reporting JS had previously compiled a paper which had analysed Primary Care spend by locality. It was agreed that the report could be usefully developed to inform investment decisions. Although acute activity would be straightforward to attribute to individual GP practices, there were other areas of spend that would cause difficulties, i.e. mental health. It was noted that the original report had been reviewed by 2 clinical directors and comments received. Action: JS was asked to review the next steps. Training Courses ECB would attend a NHS finance course run by HFMA on 24 January 2019.

JS

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10 Date of Next Meeting 29 January 2019 at 13.30pm in Room 1, Jubilee House

Schedule of Future Meetings Date Time Venue

29 January 2019 13:30 - 16:00 Room 1

21 March 2019 14:00 - 16:30 Room 1

16 May 2019 14:00 – 16:30 Conference Room B

23 July 2019 14:00 – 16:30 Conference Room A

24 September 2019 14:00 – 16:30 Conference Room B

20 November 2019 14:00 – 16:30 Conference Room B