Accountable to Whom?

Accountable Care Organisations” are mentioned 18 times in the Cheshire & Merseyside Sustainability and  Transformation Plan with no details or background. Massive reorganisation plans are now surfacing in Warrington, St Helens, and West Cheshire. Management consultants PwC, who helped write the STP itself, are guiding developments.

Accountable Care is a concept from the US health insurance market. The idea there is that a group of healthcare firms take responsibility for providing care for a given population for a defined period under a contract with a commissioner, such as Medicare. ACOs use market-based mechanisms to lower costs whilst achieving pre-agreed quality outcomes. They ‘align incentives’ between providers and commissioners, sharing any savings between hospitals, doctors and the commissioning Medicare programme itself.

An earlier version is known as the Health Maintenance Organisation, run by the insurers themselves. It involved routine denial of patients’ access to medically necessary treatment, fighting claims, screening out the sick, paying exorbitant CEO salaries, and systemic fraud. Low rent medical care had considerable hidden costs in top-ups and deductibles.

Now, the ACOs have healthcare providers in the lead. But the same insurance firms are driving and developing the process. NHS England boss Simon Stevens’ former employer UnitedHealth already has contracts with more than 800 ACOs across the US, and has just launched a national accountable care organization, NexusACO, which will be available to employers in 15 US markets.

One form of ACO, mentioned in the STP, uses ‘capitated’ or ‘global’ fixed payments to providers for all or most of the care that their patients may require over a contract period, adjusted for severity of illness, and regardless of how many services are offered. Clearly, once the payment is in place, it is open to providers to offer only as much care as required by the contract.

The specified care needs may not be comprehensive, and the defined patients may not be the geographical population. Indeed, as the Cheshire & Merseyside plan states “Greater focus could be paid on ensuring primary care is at the centre of care models and ACOs are built on GP registered lists.”

Two models promoted by the Five Year Forward View come straight out of the ACO playbook: the Multispecialty Community Provider, and the Primary and Acute Care System. The MCP, based on primary care in localities and prevention, aims to reduce avoidable hospital admissions. The Cheshire & Merseyside STP states explicitly “In parts of the system there is some ambition to build the ACOs around multispecialty community providers.”

All ACO plans simply accept the massive NHS funding cuts. They assume that pooling NHS and local authority resources, and expanding new models of care in the community, will justify cutting hospital budgets. The National Audit Office and the Nuffield Trust have recently demolished those assumptions. Warrington ACO

Warrington has agreed to pool CCG and local authority health and social care budgets, and are “determined to move away from a national tariff-based payment system to a defined capitated budget.”

The ACO Board will be established by 1 April 2017 with an independent chair and will comprise:

  • Warrington Borough Council (Commissioning)
  • Warrington Borough Council (Provision)
  • NHS Warrington Clinical Commissioning Group
  • Warrington and Halton Hospitals NHS Foundation Trust
  • Bridgewater Community Health NHS Foundation Trust
  • Five Boroughs Partnership NHS Foundation Trust
  • Warrington GP representatives

Board tasks will include designing plans for:

  • Shared accountability and risk share
  • Pooled/aligned budget arrangements.
  • Contractual (and funding) flexibility through agreed contractual arrangements that bind the ACO.
  • Arrangements for commissioning/contracting from the ACO to the health and care market.
  • An appropriate vehicle for delivery.

Options for the ACO structure include Corporate Joint Venture and (full) Merger, to be determined through an options appraisal workshop.

St Helens is setting up an “Accountable Care Management System” to involve the CCG, health providers and St Helens Council. It is set to go live in April 2018 and intends to transfer these services from Day 1: Adult Social Services, Children’s Social Services (excluding Youth Justice), Public Health, Community health services, Adult Care Services (excluding maternity), Primary Care, Mental Health Services, Community Safety Services, Community fire safety, Mental health street triage, Victim support services, Probation services, Ambulance. Other services may be added later, and the only permanent exclusions are Youth Justice, Community fire protection, and Road safety.

St Helens is now asking itself: Will the ACMS compete for tenders as a collective? Will the ACMS itself issue tenders and procure services from others?

West Cheshire CCG is planning to establish an ACO, whose parties include:

  • NHS West Cheshire Clinical Commissioning Group
  • The Countess of Chester NHS Foundation Trust
  • Cheshire and Wirral NHS Foundation Trust
  • Cheshire East and Chester Council
  • The three West Cheshire primary care localities of Ellesmere Port & Neston, Chester City and Rural

It will “take a distinct approach to segmenting our GP registered population by risk, around which our plans are based”. It will issue a Memorandum of Understanding between providers, who “have been challenged to advise how they can release a material portion of their existing resources to enable this transformation”. It will also issue a “prospectus”.

Liverpool Community Health is being broken up and handed to other providers. The biggest single contract is planned as an MCP with Bridgewater Community Health in partnership with the Liverpool GP Federation and Liverpool City Council, whose bid came in £4.6m below the value of the services it would provide. Cuts in back office staff are anticipated. In November, Rosie Cooper MP asked Bridgewater to confirm or deny plans to set-up a joint venture, pooling all budgets to provide all community health and social care from a single company. I don’t know if she got an answer.

Currently, the plan is on hold as the Care Quality Commission report on Bridgewater, finally released on 6 February, identified serious clinical failures. Liverpool CCG made clear that locality working and partnership with LCC and the GP Federation was their reason for backing the plan, unfazed by the CQC report.

Bridgewater is part of the Warrington and St Helens plans.

If it does proceed, the Liverpool MCP may later emerge as all or part of a fully fledged Accountable Care Organisation. The obvious question is, accountable to whom?


The NHS is supposed to deliver evidence-based medicine, clinicians are educated on that basis, and new treatments are only licensed after passing rigorous trials and cost-benefit analysis. What’s the point to medical school or nurse training if evidence is tossed overboard?

The St Helens plan purports to list evidence for each of their plans. None of it is referenced. For example “Stand alone telephonic case management has been estimated to reduce admissions by 5%.” Says who? The Nuffield Trust (pp85-6) says there is mixed evidence on case management. Research at the University of Manchester published in 2015 is entitled “Effectiveness of Case Management for ‘At Risk’ Patients in Primary Care: A Systematic Review and Meta-Analysis”. From the abstract:

“This was the first meta-analytic review which examined the effects of case management on a wide range of outcomes and considered also the effects of key moderators. Current results do not support case management as an effective model, especially concerning reduction of secondary care use or total costs.”

St Helens says “Social prescribing has saved Newcastle West CCG an estimated £2 – £7 million”. This is actually the Ways to Wellness programme which started in 2015 and runs for 7 years. It hasn’t been evaluated yet. Nuffield describes it as a “large scale trial”. The actual savings it will achieve are, at this stage, only projected.

Warrington says “Evidence shows that proactive planning using risk stratification is a key tool to improving outcomes”. Again, no reference for that. The Nuffield review found risk stratification tools still struggle to identify ‘at risk’ individuals at the point before they deteriorate.

A virtual ward is a model of home-based multidisciplinary care based on the idea of a hospital ward. Intended to avoid emergency admission or readmission, patients are typically identified using a risk stratification tool. As Nuffield reported, an evaluation of three NHS virtual wards targeting patients at risk of admission found no reduction in emergency hospital admissions in the six months after admission to the ward, but it did find a decrease in elective admissions and outpatient attendances. There was no reduction in overall hospital costs.

Private sector

The private sector are directly involved in formulating the ACO plans. Notorious management consultants PwC, formerly PriceWaterhouseCooper, were paid £300k for their work on the Cheshire & Merseyside STP. They were advisors on 17 other STPs. They are involved in plans for ACOs in Tameside, Wigan, Manchester City, Oldham, Cheshire, St Helens, Hounslow and Richmond, Northumbria, Mid-Nottinghamshire, and Croydon. The Northumbria plan, intended as the first ACO in the UK, has been postponed indefinitely as the CCG is £41m in deficit.

West Cheshire CCG appointed PwC to undertake an initial ‘due diligence’ phase. The consultancy also convened three workshops for the parties to the ACO.

In St Helens, the Project Management Office is “supported and challenged by PwC”. PwC has input into the proposals for Governance, IT, Business Intelligence, Communications and Engagement. A Workstream stakeholder reference group has Specialist /practitioner input from three people, two of whom are PwC staff.

The private sector can also be involved in the Governance structures themselves. In St Helens, the leadership is currently with a People’s Board, including the Council and NHS providers, but also the Community Rehabilitation Company and Helena Partnerships. Helena are a housing management group which took over former council housing. The CRC is a privatised probation service, 75% owned by Interserve, a facilities management company with PFI and other health service contracts.

The private sector is also funding new models of care. The Newcastle Ways to Wellness programme is an outcomes-based contract funded through a Social Investment Bond which includes £1.65m from Bridges Social Sector Funds. Bridges Fund Management describes itself as “Capital that makes a difference”.

The End Game

The implications for wages, terms and conditions of NHS staff when employers merge across care sectors under PwC guidance, with local structures which will threaten national agreements, are immediate. Looking further ahead, no private company is big enough to buy the whole NHS. But once the STP plans are implemented and ACOs are established across England, health transnationals will see discrete local systems with budgets of £1bn or less, with structures compatible with the US health insurance market. They could be bought and sold.

Theresa May is adamant that the NHS will remain free at the point of use. Even if that’s true, a big if, she does not mean a comprehensive, universal service, with decisions on treatment made according to clinical need, publicly provided, publicly accountable, funded out of general taxation. That’s what we’re fighting for.