POLICY BRIEFING Consultation on additional funding for Local HealthWatch and NHS Complaints Advocacy

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1 Consultation on additional funding for Local HealthWatch and NHS Complaints Advocacy Date: 12 September 2011 Author: Christine Heron, LGiU Associate Overview Subject to the passage of the Health and Social Care Bill, the Department of Health (DH) will allocate additional funding for several functions which will transfer from the DH or PCTs to local authorities. 1. Local authorities will commission Local HealthWatch (LHW), which will have a responsibility to signpost people to health and care services, a role currently undertaken by PCT Patients Advice and Liaison Services (PALS). 2. The DH currently commissions the Independent Complaints Advocacy Service (ICAS) which supports people making complaints about NHS services. Contracts end in March 2013, and responsibility for commissioning this service, now called NHS Complaints Advocacy, will transfer to local authorities. 3. With the abolition of PCTs, responsibility for providing some Deprivation of Liberty Safeguard processes in the NHS will transfer to local authorities. The consultation proposes two options for how the additional funding would be allocated to councils based on: the adult working age population adjusted for area costs or the social care relative needs formulae. The consultation seeks views on which option is preferable, and on other matters such as whether there should be minimum allocations for some of the functions.the consultation runs until Monday 24 th October A further function, commissioning Independent Mental Health Advocacy (IMHA) will transfer to local authorities in April This is not covered in this consultation and will be considered in a separate exercise. The consultation document was temporarily removed from the DH site in order to make adjustments to its contents; see comments for further details.

2 Briefing in full Local HealthWatch LHW responsibilities The Health and Social Care Bill sets out how local authorities will be responsible for funding and commissioning Local HealthWatch organisations and ensuring accountability and value for money. Local HealthWatch is to be the independent consumer champion for citizens, service users, carers and patients adults, young people and children. It will act as a point of contact for individuals and voluntary or community groups in involvement in health and social care. It will continue the functions currently provided by local involvement networks (LINks) involving and engaging with the public, recruiting volunteers, and deploying the power to enter and view premises that provide health or care to service users. It will be a corporate body, able to employ its own staff, and will have the following new functions. Influence LHW will represent the views of local people and feed these into highlevel commissioning decisions through having a statutory place on health and wellbeing boards. It will also hold local providers to account by reporting on services and making recommendations. Local information will be provided to HealthWatch England to inform the national picture about peoples views on health and social care. Signposting LHW will provide a signposting service to the public who wish for information about health and social care services and how to access these. This takes over part of the role of PCT PALS which currently provide a signposting service. The Government believes that there will be an increased demand for information to enable people to make choices about services. LINks are currently funded as part of the Local Government Formula Grant through Communities and Local Government. The consultation stresses that this funding will continue for at least the remainder of the spending review period up to The elements for which there will be additional funding are: the signposting service an element to cover increase in information about choice one-off start-up costs. The additional funding will be provided to councils, from October 2012, through the Learning Disability and Health Reform Grant.

3 National transfer of funding POLICY BRIEFING The consultation gives an example of the national funding to be transferred from PCT PALS to HealthWatch. 2012/13 (year 1) 23 million 2013/14 (year 2) 20.3 million 2014/15 (year 3) 20.8 million. This includes: signposting funding of 19.3 million for each of years 1 to 3 one-off start up costs of 3.2 million in year 1 increased demand for choice of service: 0.5million in year 1, 1 million in year 2, 1.5 million in year 3. This funding is illustrative only; the final national budget will depend on a data collection exercise with PCTs and DH business planning for 2012/13. The exact amount to be transferred will be published alongside provisional local allocations in late Year one funding will be proportionate to the half-year period. Options for allocating the budget to local authorities The consultation seeks views on which of the following options should be used to distribute the transferred funding to councils. LHW 1 based on the adult working age population, adjusted for area costs. LHW 2 based on the adult social care relative needs formula. In relation to option 1, the consultation indicates that, although there is no comprehensive data on PALS that shows activity in local authority areas, there is information to indicate that around 75% of people who used signposting functions were in the age category. In relation to option 2, it indicates that this measure is most likely to reflect the number of people needing to access health and social care services in an area. The consultation indicates that both options are suitable, but neither is ideal. Option 1 assumes that health and social care needs rise in proportion with the size of population, but the picture is more complicated than that, and factors such as the number of very old people and deprivation need to be considered. Option 2 only relates to people who receive council funding, rather than those who fund their own care who are, perhaps, more likely to use signposting services. On balance, the Department believes option 2 is preferable because it provides a link with users of care services rather than the general adult population. The consultation is also seeking views on a proposal to set a minimum level for allocation so that no local authority receives less than 20K to provide the additional functions. This is because LHW will incur some costs regardless of the number of

4 people they engage, such as reporting, service-evaluation and their role on the local health and wellbeing board; also so that LHW is able to cope with unforeseen service demand pressures. If there were no minimum allocation, the smallest council would receive less than 2K. If the minimum allocation were applied, large councils receiving over 200K additional funding would have a reduction of less than 500. The appendix to the document shows the how the illustrative allocations to each local authority would vary, dependent on which allocation option was used, and whether there was a minimum level. NHS Complaints Advocacy ICAS (Independent Complaints Advocacy Service) provides support to individuals making a complaint about an NHS service. The service is currently managed through the Department of Health with contracts in the voluntary sector which run until March Subject to the Health and Social Care Bill, local authorities will take on responsibility for commissioning the NHS Complaints Advocacy service. NHSCA can be commissioned from Local HealthWatch or from a third party provider. If the latter, LHW will signpost people to the relevant service. The consultation indicates that there is currently one ICAS office per six local authorities, and commissioning at a local level will result in lost economies of scale which are estimated at 2.5 million a year. The (illustrative) funding for ICAS is 14.2 million for 2013/14 and the following year made up of 11.7million existing ICAS funding and the 2.5 million for lost economies of scale. The consultation seeks views on the same two options for local authority funding allocations as for Local HealthWatch, and again prefers option 2. However it proposes that, since the funding required to fund NHS Complaints Advocacy depends on the number of complaints lodged, there should be no minimum allocation. Deprivation of Liberty Safeguard (DOLS) processes DOLS processes include assessing that the nature and extent of liberty deprivations are appropriate on a case by case basis and training those involved with respect to their responsibilities under the Mental Capacity Act (2005). Currently, local authorities receive funding for DOLS assessments in residential care and PCTs receive funding for assessments in health settings via the general PCT funding formulae. Councils will take over responsibility for DOLS assessments in health settings. The consultation proposes a transfer of 1.4 million in year 1, 1.1 million in year 2, and 0.9 million in year 3 (illustrative figures subject to final agreement). The two options for allocation to local authorities are those outlined above, and again the preferred option is the social care relative needs formulae. The government is also proposing to set a minimum allocation to each area of 2,000 to reflect the fixed costs of staff training for a PCT DOLS service. This increases the allocation for less

5 than ten local authorities. It is also seeking views on whether funding should transfer to local authorities in October 2012 or April Comment The document indicates that the consultation period is ten rather than twelve weeks because of the need to engage and involve DH stakeholders in the revisions to make the document easier to understand. This is a euphemism for the document being temporarily withdrawn from the DH site to make changes to the section on HealthWatch. Health Service Journal indicates that the document was published without the knowledge of the HealthWatch programme board or advisory group. There was also a view that it appeared to suggest that the 20,000 minimum allocation was the total funding to be allocated to some LHWs. The document subsequently clarified that the funding discussed in the document was additional to existing LINk funding. Both funding allocation options appear to have some merits, and local authorities will wish to decide which they believe should be the preferred option. There will of course be winners and losers dependent on the formulae used. Perhaps on balance it would seem that the DH s preferred option for the social care relative need formulae would be the fairest choice, given that it is more likely to reflect a greater level of need for health and care services. An equally pertinent issue is the level of the national funding for HealthWatch. The figures in the consultation reflect those in the initial Impact Assessment for the Health and Social Care Bill, specifically section D43, quoted below: Helping the public with health related decisions. Based on the estimated cost of the Primary Care Trust (PCT) PALS function, the cost of this activity is 19.3 million per year. This is calculated using an evaluation of PALS (source: National Evaluation of Patient Advice and Liaison Services Final Report, Evans & al. Jan 2008), the average cost of a PCT PALS service (uprated to costs) is 169,000. However, the report also states that time spent dealing with functions other than providing advice on choice is around 35% of staff time. Assuming that staff costs account for 70% total, this suggests that existing spend by PCTs is about 127k per PCT. The PALS Network points out that the funding appears to relate to the full range of PALS activity, whereas signposting accounts for only a proportion of PALS time. Representatives of the Network contend that there should not be an assumption for full funding to be transferred to LHW if only a proportion of PALS activity is undertaken; there is also a suggestion that there should be an option for PALS

6 funding to be retained by clinical commissioning groups (CCGs) that wish to provide a PALS service. Perhaps it is not entirely clear what the additional funding is for the document indicates that it is for signposting, but also seems to suggest that it covers other LHW responsibilities such as the role in health and wellbeing boards. Surveys of PALS have, somewhat predictably, shown that they do not have confidence in the ability of HealthWatch to take over their role. In terms of signposting this lack of confidence is misplaced an independent organisation covering both health and care should be able to perform very effectively. In fairness, however, PALS do have a role which can best be conducted as an NHS organisation low level problem solving to prevent the escalation of a problem to a complaint. Provider PALS do this routinely, and PCT PALS also had a role in doing this in primary care. This useful role is something CCGs might wish to see continue. HealthWatch has an even more important and higher profile role than its predecessors, patient and public involvement forums and LINks. In its contribution to health and wellbeing boards, HealthWatch is an important partner of both councils and PCTs. As a signposting organisation, it will play a key role in the choice and personalisation agendas for both health and social care. Clearly success depends on sufficient funding, a point which local authorities will wish to emphasise. It would be very unhelpful if, following the DH s completion of its data collection and business planning, the amount were revised down. Local authorities will also need to consider how they are managing the non ringfenced LINk funding. The National Association of LINks Members (NALM) found that only six out of 150 LINks avoided cuts to their budgets this year. While LINks, and HealthWatch, must take their share of budget pressures, it is important that their importance is recognised. The role of health and wellbeing boards in overseeing the commissioning of HealthWatch should assist this process. For more information about this, or any other LGiU member briefing, please contact Janet Sillett, Briefings Manager, on

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