1. for more information visit us at www.hempsons.co.uk Birmingham South and Central CCG Legal issues for authorisation Christian Dingwall, Partner Wednesday 25 July 2012

2. Contents The new healthcare landscape Overview of functions, duties and powers Governance: Developing your Constitution Setting up your governance structure Risk management: Accountability Decision-making Conflicts of interest

3. The new healthcare landscape

4. CCG status Corporate body Statutory body NHS body

5. CCG role and functions Arrange the provision of health services for the health service in England Commission health services for registered patients and other persons ordinarily resident within CCG locality Commission emergency care Pay employees’ remuneration etc Determine remuneration etc of governing body members

6. CCG arrangements for discharge of functions Act consistently with SoS and NHSCB duty to promote a comprehensive health service Meet the public sector equality duty Work in partnership with local authority – JSNA and JHWS

7. CCG financial duties Break even (capital / revenue expenditure) Provide information to the SoS and NHSCB

8. CCG general duties Promote NHS Constitution Exercise its functions effectively, efficiently and economically Secure continuous improvement in quality of services and support NHSCB to secure continuous improvement in quality of primary medical services Secure that health services are provided in an integrated way and integrated with provision of social care services Promote involvement of patients and carers

9. CCG general duties Enable patients to make choices about their health services Secure that individuals are involved (by being consulted or provided with information) in planning of services Have regard to need to reduce inequalities between patients with respect to their ability to access health services and the outcomes achieved for them

10. CCG general duties Promote innovation in the provision of health services Have regard to the need to promote research Obtain appropriate advice

11. CCG powers Allow another CCG to exercise functions on their behalf Exercise functions jointly with other CCGs (e.g. a federated model) Raise additional income for improving the NHS (includes powers to set up a company) Make grants or loans to voluntary organisations Enter into Section 75 partnership arrangements with Local Authorities Enter into externally financed development agreements

12. CCG powers Can CCGs establish joint committees? Can CCGs establish / invest in subsidiary companies?

13. Governance: structure of a CCG Member practices Governing body Audit committee and a remuneration committee Accountable officer Chief finance officer

14. Governance: constitutional documents Constitutional documents: Constitution Scheme of Reservation and Delegation Terms of Reference for committees and sub-committees Standing Orders Prime Financial Policies Code of Conduct for Conflicts of Interest Can we change the Constitution in the future?

15. Governance: the Constitution NHSCB draft Constitution published but many issues still to be resolved Constitution is an agreement between member practices But little detail about how member practices will govern their relationship between themselves Can member practices expel each other from the CCG? Need to define the role of practice representatives

16. Governance: the Constitution (2) Constitution must include: arrangements for the discharge of functions procedures for making decisions arrangements for dealing with conflicts of interest arrangements to ensure there is transparency about decisions and the manner in which they are made

17. Governance: governing body functions Functions: ensure CCG operates effectively and efficiently ensure CCG complies with principles of good governance: Nolan Principles Good Governance Standard for Public Services setting salaries and allowances of CCG staff such other functions as specified in the Constitution or by regulations

18. Governance: governing body membership Governing body members will include: health care professionals (including 1 registered nurse and 1 secondary care specialist) lay persons (including 1 person to champion patient involvement and 1 person to oversee governance) the accountable officer a chief finance officer other individuals prescribed by regulations

19. Governance: governing body Regulations to specify composition, qualification and disqualification and appointment criteria, Governing body must have an audit committee and a remuneration committee and can appoint other committees (e.g. a quality committee)

20. Governance: the Nolan Principles The Nolan Principles: Selflessness Honesty Objectivity Openness Leadership Accountability Integrity

21. Governance: Good Governance Standard The Good Governance Standard for Public Services: performing effectively in clearly defined functions and roles promoting values for the whole organisation and demonstrating the values of good governance through behaviour taking informed, transparent decisions and managing risk

22. Governance: accountable officer role Responsible for ensuring that the CCG complies with: obligations to exercise its functions effectively, efficiently and economically and with a view to securing improvement in the health service obligations for accounts, audits and provision of financial information to the NHSCB and SoS Responsible for ensuring the CCG exercises functions in a way that provides good value for money Individual liability?

23. Governance: accountable officer role (2) Can be an employee of a member practice but do not have to be Can be a joint appointment with other CCG(s) Appointed by NHSCB which can also replace accountable officers Must be a member of governing body

24. Governance: key issues to consider for governance structure (1) CCG: What functions will it delegate to the governing body? What committees will it set up? locality committees? a management committees? How will the CCG manage relations with its practices? How would a member practice leave a CCG? How will the composition of committees be decided?

25. Governance: key issues to consider for governance structure (2) Will the GB’s functions be restricted to specified statutory functions (oversight etc) or will the CCG delegate additional functions to it? Which functions will the GB delegate to committees How will practices be represented on the GB? What voting rights will they have? – Eg 1 vote per practice or weighted voting rights based on list size?

26. Accountability: overview Internal accountability Members Practice representatives Accountable officer Governing Body External accountability NHSCB (Patients and public) (Health and Wellbeing Board) (Secretary of State) (Clinical senate)

27. Accountability: delegation (1) CCG accountable but can delegate to: any members Governing Body employers committees or sub-committees audit and remuneration committees are mandatory

28. Accountability: delegation (2) Key decisions What will be delegated to the governing body? additional functions? All functions? What responsibilities will practice representatives have? What other committees will be established? a management committee? What will be delegated to individuals?

29. Decision-making: issues to consider Functions and duties set out in the Act CCG governance processes Procurement law and guidance Consultation duties Bribery Act Public sector equality duties Freedom of Information Act Possibility of judicial review of your decisions

30. Decision-making: functions and duties What do you need to do to discharge your functions and duties? Is there a difference between your duties to: “act with a view to…”(secure improvement in quality of services / enabling patient choice / securing integration) “have regard to…”(need to reduce inequalities) “promote…”(innovation / research / education and training / involvement of patients) What if there is a conflict between duties (e.g. choice and integration)?

31. Decision-making: procurement duties CCG will need to comply with law and guidance Regulations to be published to require CCGs to adhere to good procurement practice and not engage in anti-competitive practice – Monitor will enforce this CCG must consider whether to tender services on a case by case basis A high risk area where CCG decisions could be open to challenge

32. Decision-making: Judicial Review (1) How can CCG decisions be challenged? Judicial review: A procedure by which the courts supervise the exercise of public power Grounds for reversing an administrative decision by way of judicial review: Illegality Irrationality (Unreasonableness) Procedural impropriety Application must be made promptly (no later than three months)

33. Decision-making: Judicial Review (2) The decision can be set aside (quashed) and: damages mandatory orders to compel the authority to do its duty injunctions to stop the authority from acting illegally Cannot apply for JR of laws passed by Parliament, except where law is contrary to the EU law

34. Decision-making: Freedom of Information (1) The Freedom of Information Act creates a general right of access, on request, to information held by public authorities. On receipt of a FOIA request a public authority has two duties: to inform a member of the public whether or not it holds the information requested if it does hold that information, to communicate it to the person making that request

35. Decision-making: Freedom of Information (2) Additional duty to aid individuals in making requests and ensuring that they frame their FOI requests appropriately However, there are numerous exemptions The FOIA request: no special format for a request do not need to mention the FOIA do not have to give a reason for the request

36. Conflicts of interest: the Act CCG must maintain public registers of interest for: CCG members members of the governing body members of CCG or governing body committees and sub- committees members staff CCG must put arrangements in place for the declaration of conflicts of interest or potential conflicts of interest relating to the exercise of commissioning functions (no later than 28 days)

37. Conflicts of interest: the Act (2) CCG must make arrangements to manage conflicts in a way that does not, and does not appear to, affect the integrity of decision-making processes NHSCB will publish mandatory guidance See NHSB guidance Towards Establishment: Technical Appendix 1

38. Conflicts of interest: technical guidance (1) Principles: Doing business properly Being proactive not reactive Assuming individuals will act ethically and professionally but may not always be sensitive to conflicts Being balanced and proportionate

39. Conflicts of interest: technical guidance (2) Points of best practice: Include in the Constitution a statement of conduct expected of individuals which reflects the Nolan Principles Provide guidance on what might be a conflict of interest: A potential conflict can be as damaging as an actual conflict If in doubt assume there is a conflict and manage it Financial gain is not necessary for a conflict to exist

40. Conflicts of interest: technical guidance (3) Points of best practice (cont’d): Have a process to declare interests – on appointment/promotion, annually, at meetings etc Appoint a person to maintain the registers of interests Exclude individuals with material conflicts of interest from governing body (e.g. major provider or CSS personnel) Exclude individuals from meetings or decision-making when conflicts arise If more than 50% of governing body or committee members are conflicted consider securing external involvement in decisions (e.g. from other CCGs)

41. Conflicts of interest: technical guidance (4) Points of best practice (cont’d): Act transparently and non-discriminatorily when designing service requirements Exclude CCG practice members who are bidding for contracts tendered by the CCG from the tender and evaluation teams Put safeguards in place where commissioning without tender from CCG practice members – a Code of Conduct

42. Conflicts of interest: commentary (1) Towards Establishment: Technical Appendix 1 RCGP / NHS Confederation publication “Managing Conflicts of Interest in Clinical Commissioning Groups” sets out some principles for managing conflicts of interests, including: inducting members properly to the Board agreeing in advance how a range of different situations and scenarios will be handled

43. Conflicts of interest: commentary (2) RCGP / NHS Confederation publication (cont’d) sets out some outstanding policy questions: who will monitor and assess CCGs on how they are managing conflicts of interest should healthcare professionals be required to make more explicit choices between pursuing commissioner or provider roles recognises that there is nothing inherently wrong in having conflicts of interest and that seeking to avoid or eliminate them entirely is unlikely to be possible or desirable for CCGs

44. Conflicts of interest: commentary (3) BMA Publication “Ensuring Transparency and Probity”: this “guidance” takes a much more robust approach “the taint of conflict of interest is almost as damaging as the reality” “the directors of provider healthcare organisations or those GPs having a significant financial holding in such an organisation should not be on a CCG board at all if there is any likelihood that they could enter into a contract with that consortium at some stage”

45. CCG establishment Transfer of workforce from PCTs to CCGs Contracting with providers, other CCGs, local authorities, CSS, other suppliers etc Transfer of premises, equipment and IT from PCTs to CCGs

46. Risk management: practical considerations (1) Decide what good governance means to the CCG Consider the use of sub-committees and the constitution of the governing body Test policies against possible scenarios Enshrine this within the constitution Have this independently assessed Consult on it Keep policy under review

47. Risk management: practical considerations (2) Governing Body: Meet regularly Formal agendas Balance of skills and competencies Concerns noted in Minutes Insurance cover Timely provision of information in a form and of a quality to enable directors to discharge their duties

48. Risk management: practical considerations (3) Induction on joining Board and regular updating of skills and knowledge Formal and rigorous annual evaluation of the performance of the Board, committees and individual directors Take independent advice where appropriate

49. Corporate risks and personal liabilities Protection from corporate risks – CCG eligibility to join NHSLA schemes Protection from personal liability – section 69 NHSA / section 265 of the Public Health Act 1875 Exceptions from protection from personal liability? CCG indemnities for officers and non-officers Residual liabilities on CCG abolition?

50. Questions and discussion c.dingwall@hempsons.co.uk 020 7484 7525 (M) 07710 703 767 www.hempsons.co.uk © Hempsons Solicitors 2012 Disclaimer: These slides are made available on the basis that no liability is accepted for any errors of fact or opinion they may contain. Professional advice should be obtained before applying the information to particular circumstances