Cambridgeshire CCG and UnitingCare Partnership

George Freeman Excerpts

Monday 18th January 2016 Commons Chamber

[The Parliamentary Under-Secretary of State for Life Sciences (George Freeman)]

I congratulate the hon. Member for Cambridge (Daniel Zeichner) on securing the debate and thank the Members who are present, including my hon. and learned Friend the Member for North East Hertfordshire (Sir Oliver Heald)—I know that he has an interest in the matter—for attending. I also pay tribute to all those working on the frontline in the NHS in East Anglia, particularly at this time of year, when pressures are at their greatest.

As the hon. Gentleman has described, the contract between Cambridgeshire and Peterborough CCG and UnitingCare Partnership has very recently been terminated. I need to say right away that NHS England has launched an investigation into the circumstances surrounding the contract. Its terms of reference are to establish, from a commissioner perspective, the key facts and root causes behind the collapse of the contract in order to draw out any recommendations and lessons to be learned. I understand that the CCG is also undertaking a review, as is right and proper.

We should let the NHS complete that process. I hope that nothing I say today can be taken as an assumption that Ministers have in any way prejudged the outcome of that process. Clearly there are different views about what has happened, and I want to wait for the reports of the reviews before deciding what, if anything, needs to be done, either by the NHS or by the Government. Once the reports are published, Ministers will be briefed on their conclusions. I am happy to invite the hon. Gentleman to that meeting, although I cannot say today exactly when it will take place. I know that he is in regular contact with his local NHS, and I encourage him to keep that up.

The core scope of services in the contract with UnitingCare was acute unplanned hospital care for older people—those 65 and over—older people’s mental health services, older people and adult community services and a range of supporting voluntary sector services. The underlying principle was to create an integrated care pathway between all these services. The UnitingCare service model was designed by local clinicians during the procurement process and had a high degree of local health and social care support. Its detail and assumptions were subsequently ratified by two independent auditors. It was designed to: join up services around the patient and reduce service fragmentation; to focus on better outcomes for patients and carers, rather than activity levels; to invest in out-of-hospital services in order to better address the needs of a rapidly ageing and growing population; and to deliver £170 million of savings to the local health economy by 2020 by reducing inappropriate emergency admissions to hospital and inappropriate A&E attendances.

UnitingCare began introducing those new services with an investment of £5.4 million over the first six months of the financial year. They included a number of important local improvements, such as: care based around neighbourhoods, with 17 neighbourhood teams working closely with GPs; access to specialist services, with neighbourhood teams and the support of four integrated care teams to offer more specialist care; a 24/7 helpline, called OneCall; urgent care and support, with joint emergency teams to assess and treat people most at risk of admission to hospital; health and wellbeing, with voluntary organisations working together; a single view of the patient record, called OneView, providing professionals with a summary of all information about a person’s health; and a health analytics service to target interventions at those most at risk of admission.

To achieve those improvements, a contract was needed between the provider and the CCG. The main components of the contract were: a new framework for improving outcomes; a new contracting approach to align incentives in a better way; a five-year contract term; and a new lead provider, UnitingCare. It was therefore a high-value contract; it had a total value of around £800 million. Having taken legal advice, the CCG went to open procurement, using a standard three-stage process—pre-qualification, an invitation to submit outline solutions, and an invitation to submit final solutions. The CCG prospectus set out the CCG budget and the evaluation criteria. It was a contract entered into in good faith. This included submitting bids within the CCG budget. The CCG budget incorporated forecast population growth, an acuity factor, and QIPP—quality, innovation, productivity and prevention—savings for each year.

In 2014, there was in some quarters, as the hon. Gentleman said, concern that the process was “stealth privatisation”. Clearly no one, on any objective criteria, would agree that that was the case; it was merely, as he said, a service reconfiguration placed with a not-for-profit company set up by local health providers. The boards of Cambridge University Hospitals NHS Foundation Trust and Cambridgeshire and Peterborough NHS Foundation Trust held the firm belief that only by introducing radical change led by the NHS would the local health economy under the CCG become viable for patients, staff and the respective trusts across the region. For that reason, they decided to submit a joint bid and, following commercial and legal advice, opted to create a limited liability partnership to fulfil the role of prime vendor, as required by the CCG.

The CUHFT and CPFT consortium was appointed as preferred bidder at the end of September 2014. In October, it formed UnitingCare LLP to hold the contract. The strategic projects team was appointed as procurement adviser to the CCG through a competitive process and its role was to manage the procurement process. The strategic projects team is a specialist unit hosted by the Arden and Greater East Midlands commissioning support unit, which has substantial experience in managing complex procurements. The CCG also appointed legal advisers, Wragge Lawrence Graham, and financial advisers, Deloitte, to support the procurement process.

Much information about the costs of the current services, staffing details and timescales could not be provided by the CCG to UnitingCare until it was at preferred bidder stage. As a result, UnitingCare’s bid was heavily caveated and based on assumptions. To illustrate this point, at the time of preferred bidder award status, there were 71 outstanding clarification questions from the procurement process. The contract signed between the CCG and UnitingCare also included several protection clauses to be utilised in the event of the financial distress of either party. Subsequent to contract signature, additional clauses were agreed that allowed for the rapid exit of the contract in the event of the financial destabilisation of either party. With these protections in place, trust boards, the CCG and Monitor allowed the contract to be signed in November 2014 and for the necessary mobilisation activities to facilitate service commencement on 1 April 2015.

There were clear improvements in patient care. For example, in November 2015 emergency admissions for over-65s reduced by just short of 8% compared with the previous year and by 9% when taking into account population growth; admissions of more than two days’ duration for people over the age of 65 reduced by 14%; and A&E attendance reduced by 3.2% when taking into account population growth. However, in December the contract was terminated by mutual agreement.

[Lucy Frazer (South East Cambridgeshire) (Con)]

As my hon. Friend says, there were advantages to this project and it produced good outcomes. If it is a good concept, will the Department of Health support the services that so need to be provided?

[George Freeman]

My hon. and learned Friend makes an excellent point. The service is currently being continued, albeit by the CCG rather than through the company that was created for the purpose. As she says, the reforms that were put in place were the right reforms. Indeed, they were led by local clinicians and designed with that in mind.

[Sir Oliver Heald (North East Hertfordshire) (Con)]

In Royston we have the Royston NHS and social care hub, which will include beds as well as other services. Does my hon. Friend agree that there is no reason at this stage for people to become anxious that the difficulty with the contract will lead to any change in the quality of services that are planned for the future?

[George Freeman]

That is right. As both questions have highlighted, the change in the care pathway is being pursued by the CCG and there is no reason for patients—the users of the system—to fear any dramatic change to the service. The remaining issue is the residual issue of how the contract came to be put in place. The dispute between the parties is about their different conceptions of the financial and contractual situation. I do not want to prejudge the investigations, but the service reforms will continue.

The final decision to terminate was taken after extensive discussions between the CCG, UnitingCare, Cambridge University Hospitals NHS Foundation Trust, Cambridge and Peterborough NHS Foundation Trust, NHS England and Monitor. Prior to escalation to NHS England and Monitor, the CCG, CUH and CPFT worked hard to try to reach a resolution locally.

[Daniel Zeichner]

Could the Minister enlighten me on the role played by Ministers in that final decision? Did they know it was happening? Who ultimately terminated the contract?

[George Freeman]

As I will come on to say, due process was followed in the correct way. One of the reasons for listing all these acronyms is so that the hon. Gentleman can be reassured that the right bodies carried out their due diligence. I do not believe that there was any reason for Ministers to be concerned at any point until the dispute between the parties became clear. Indeed, the reforms had been generated locally by clinicians and an accountable CCG led by clinicians. As the questions I have been asked have illustrated, the reforms were and remain very sensible. This is a better care pathway, with improved outcomes.

The issue is contractual and relates to a dispute between the parties about liabilities in the contract. As I have said, I do not want to prejudge the ongoing investigations, the point of which is to work out what should have been done differently. I can absolutely reassure the hon. Gentleman and the House that we are hungry to learn any lessons from that commissioning experience. We need novel commissioning. We need commissioners around the country to look into different ways of commissioning the reforms to our integration of health and care, and lessons need to be learned when it goes wrong. I emphasise that this was a contract between the parties. As I have said, the Department is looking forward to the reviews and wants to hear the lessons that others can learn.

The CCG has now taken over all relevant contracts with providers that were previously held by UnitingCare, to ensure that there is no service disruption to patients and carers. In addition, the CCG and CPFT, which employ the majority of the affected staff, have worked closely together to ensure that frontline staff are clear that, while the contractual model has now changed, the service model remains in place.

Of course, I agree with hon. Members that it is a matter of extreme concern that the new arrangements lasted barely six months. That is not ideal. We need to work out how the parties got it wrong and what mistakes were made. There are questions for the reviews to address. For instance, there is the question of why, given full procurement and assurance of the process, the result fell so far short in practice, along with other associated questions.

To describe modern commissioning as back-door privatisation is wilfully to misrepresent what is going on. These are clinician-led improvements to the care pathways, and I do not believe that most service users would consider it privatisation. We are talking about two public sector organisations coming together to form a company for the purposes of jointly commissioning care pathway innovation put together by clinicians in the local CCG. If Labour considers that privatisation, it has a serious problem, because most people would consider it enlightened commissioning for modern care pathways. This is a contract issue. The parties to the contract did not get it right, and we are keen to understand why and what can be done to make sure it does not happen again. I want those answers as much as the hon. Gentleman, and I repeat my invitation, to him and other hon. Members with an interest, to meet in due course to learn the lessons and make sure that the benefits of commissioning for integration go ahead without the contractual errors that have bedevilled this project.

Question put and agreed to.