1. Financial Recovery Plan November 2015 (Month 7 reporting)
2015/16
November 2015 (Month 7 reporting) v2

4. Executive Summary
This document provides a summary of the financial recovery plan for west Essex CCG and actions being taken to deliver the planned 1% (£3.6m) surplus with £0.2m head-room by 31st March 2016.
As the CCG emerged from Q1, it became clear that the demand pressures were higher than planned particularly with respect to acute non elective performance and GP prescribing. By Month 4 and 5 reporting it has become apparent that this level of demand would impact on the organisation’s ability to deliver the control total. This was reported to NHSE through regular review meetings, the last held 16th October 15 when the last FRP pack was submitted and discussed. Prior to this the senior team met with R Hardy, together with the NHSE team 23rd September.
This pressure has been compounded by a series of non-recurring financial hits during 2015/16 totalling some £4m. These include £1.65m to resolve the Barts Health dispute from 2014/15, NHSE finding against the CCG in its £2.4m dispute with UCLH. Additionally there is £2.06m of financial risk relating to unresolved disputes with NHS Property Services.
The CCG has reported a surplus with £0.2m of head-room (total £3.77m) for month 7, however this has only been managed by fully depleting the reserves, and assuming that the FRP delivers savings and mitigate risks totalling £8.56m. To date £8.76m of opportunities have been identified which if delivered in full would result in a surplus of £3.77m.
These savings include delivery of existing QIPP plans not yet factored into our run rates (circa £1m) plus an additional stretch of £1.1m.
Forecast variance from plan has improved from £16.7m (FRP v6) to £8.56m, and mitigations have moved from £16.03m (FRP v6) to £8.76m. These movements in mitigation and risk are, in the main, due to actions undertaken and delivered from the existing FRP and QIPP plans. The full bridge between versions is in slide 5.

5. Bridge of movements between the FRP versions 15.10.15v6 and 11.11.15v1

6. Financial Recovery - Governance
To strengthen delivery of financial recovery and maintain pace, a Turnaround Support (John Leslie) has been appointed who will commence work 16th November 2015.
A Financial Recovery Planning committee (FRP) is in place, currently chaired by the Chief Officer with membership comprising the Chief Finance Officer, Director of Transformation, Director of Primary Care & Localities, Integrated Commissioning Director, Deputy Chief Financial Officer, Deputy Director of Contracting and Performance and PMO.
The FRP committee meets on a fortnightly basis.
The FRP will be sighted on all transformation and financial recovery initiatives on a fortnightly basis via the transformation tracker & financial recovery report. Finance and Performance committee adds additional assurance to the delivery of transformation and financial recovery at monthly committee meetings.

7. Drivers of Deficit
In 2014/15 WECCG reported a final year end surplus of £0.873m against an original plan of £3.3m, with financial performance moving adversely against plan from July The CCG commenced the year with a -4.9% (c£16.7m) distance from target (DFT) of fair share funding.
In 2015/16 the CCG commenced the year with a -2.92% DFT of fair share funding (c£10.31m).
Acute non-elective performance and GP prescribing pressures emerging in the 1st quarter have been compounded by a series of non-recurring financial events from 2014/15.
The CCGs main acute provider, Princess Alexandra Hospital, has significant financial pressures. It has a planned deficit of £28m, recently stretched by the TDA to £25m. The Trust is currently forecasting a deficit of circa £35m for 2015/16.

8. Mitigating Plans

9. Overview of Initiatives
Disputes – £2.88m /15
NHS Property Services: £2.06m estimated exposure, dispute spread
over 2 years.
Meeting with CM and Martin Royal, agreed that a dispute resolution
was required. Details of how/when is pending agreement.
Summary of challenges (shown only for 14/15, no invoice received
for 15/16 at this point)
Barking Havering Redbridge, Royal National Orthopaedic Hospital, Guys and St Thomas.
CCG has been raising challenges for specialist neurology activity at BHR, and specialist
spinal activity at RNOH since early 2014/15. The G&ST dispute is a one off high cost
patient challenged as a specialist spell with 100+ critical care bed days.
Full value of the disputes were accrued into the 14/15 accounts.
BHR dispute is now part of a formal dispute process led by B&B CCG. WE is the only CCG
to have not paid 14/15 disputed invoices.
RNOH dispute is now part of a wider dispute led by the host commissioners CSU (Optum) challenging CCG payments of specialised activity. Other Trusts included in this dispute include UCLH. G&ST has been reviewed by our clinical leads. The spell is specialist neurology.
Contracting mitigations – 4 schemes £3.74m
All challenges and penalties are raised in accordance with the contract, technical disputes are carried out using established rules from MedeAnalytics. Where technical disputes are likely to require dispute resolution, advice has been taken from RSR Consultants.
There is a challenge to PAH around coding and counting of A&E data and incorrect billing of emergency activity.
Transformation mitigations – 17 schemes £2.14m
There are a number of projects that were scheduled to begin in the second half of the year. These have been included as part of the financial recovery plan and total £1.0m, (excluding contracting £2.3m – see above).
Additionally there has been further focus around the medicines programme and financial recovery has identified £441k to mitigate the cost pressures seen during 15/16, specifically in respiratory, pain, diabetes, nutritional supplements & further stretch in current successful projects. An action plan is in place and implementation has commenced.
CHC is on target to deliver its plan of £850k this year and has identified further opportunity (£411k) which can be delivered through more reviews of high costs packages, tightening procedures around placements, review of fast track patients & tighter controls around invoicing & payment. An action plan is in place and implementation has commenced to achieve target.

10. Overview of initiatives
Paediatric primary care hubs - £25k MDTs scheduled in quarters 3&4, the first already completed & the effect of early learning will be rolled out to have an incremental effect in 2016/17. This forms part of models of care work and is progressing to plan. Performance monitoring required.
CAMHS - £35k The CAMHS re-procurement has a contract start date in quarter 3, when the financial saving will impact. All actions complete.
Neuro Rehabilitation - £84k Provision of a local neuro-rehab service was due to commence July This was delayed by a month and the low volume of patients means savings did not impact until September, with a very small amount seen in August 15. (98k PYE Sept – Mar 16.) Performance monitoring required.
MSK - £28k The back pain & pain management pathway has been prioritised, due to go live in quarter 4 as originally anticipated. Approval of business case due in December, with implementation immediately after.
Clinically effective pathways – gastro - £36k The gastro pathway was developed in partnership with PAH and went live in late Sept Performance monitoring.
Referral Support - £112k The first half of the year did not see the reduction in 1st outpatient apptmts anticipated. An action plan is being addressed urgently, together with additional focus through practice variation work that is currently being carried out to move this project back on track. Immediate action & scrutiny.
Decommission Tele-health - £13k A paper will be presented to H&CC in November to seek approval to decommission tele-health with immediate effect.
Shortness of breath and chest pain pathway - £149k There has been a rise in emergency activity for working age adults in two main specialties around respiratory and chest pain. The 1st phase winter primary care plan is complete and implementation during Oct 15 will see an impact on activity from Nov Staged implementation in line with action plan & performance monitoring required.
Community DVT provision - £50k – A business case is being developed for approval in November, to put into place a DVT community pathway for quarter 4.
Morelife obesity - £12k Contract has been reviewed, amended and extended with a start date in quarter 3 of 2015/16. Actions complete.
Hospice at home extension - £84k This service has increased it’s capacity and recruitment is complete. The additional capacity will have an impact on hospital activity from September, supporting patients to stay at home in their end of life stage. Performance monitoring required.
RAC/CARS - £50k Further support provided to the CARS team to stop patients from being admitted from A&E. Performance monitoring required.
Rapid Response - £289k Integrated rapid response service has been implemented with first impact due in October 15. Live with performance monitoring.
Clinical priorities - £30k The tonsillectomy policy was reviewed and approved during the first half of 15/16 and will have an impact on activity in the second half of the year. The hysterectomy policy has been approved with 1 months notice currently being served, followed by immediate implementation & monitoring.
Estates - £287k The work reviewing all estates has been progressing and the impact of this will be seen in the latter half of 2015/16 and into 2016/17.

11. Impact of FRP on activity
The forecast activity impact of the transformation programmes identified as part of FRP, is shown above.
Some projects began to deliver in September – the financial & activity impact for the remainder of the year (Oct – Mar) is shown.
Detailed analysis of areas of development in medicines management is available, however outside the scope of this activity chart.
CHC savings relate to processes, tighter control and patient reviews. Activity not in the scope of this activity chart.
Estates affected delivering financial benefit:
Sydenham House
Waltham Abbey health centre
Ongar War Memorial

12. The CCG forecasts are essentially straight line after allowing for non recurring items such as the UCLH dispute resolution and the CCG also applies a variation for planned care forecasting based on working days.
The light blue line shows the cumulative year to date position excluding the impact of smoothing the position via utilisation of reserve. The key shift in August (month 5) links in with the full recognition of the UCLH liability; the first quarter acute billing data which confirmed an already known high overperformance in non elective admissions; and the first prescribing forecast from the PPD.
The period between months 5 and 7 saw delivery of FRP actions particularly with regards to stopping investments/spending decisions, contracting, and other risk mitigations.
The CCG FRP assumes some key delivery with respect to resolution of disputes in month 9 (December).

13. The Underlying Position
The underlying position is a key measure of the financial sustainability of the CCG. The above table summarises the impact of the forecasted pressures and implementation of the financial recovery plan and compares it to the underlying surplus as per the plan.
The CCG started the year with a planned underlying surplus of £8.3m. The current forecast, including a fully implemented FRP, is that this is reduced to £5.9m. This has increased from the £4.9m underlying position reported in the FRP v6 largely due to a corrected error in excluding GP IT as a recurring spend.
Assuming successful delivery of this years FRP and that no new pressures materialise during 15/16 and 16/17 the CCG should enter 16/17 in a stronger sustainable position versus the £1.8m underlying deficit position with which the CCG exited 2014/15.