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Finance Report Month 9 2011-12

Finance Report Month 9 2011-12. Jonathan Wise, Director of Finance & Performance. NHS HARROW FINANCE REPORT 11/12 - CONTENTS. Summary [Slides 3-7] M9 Position [Slides 8-36] Forecast outturn position [slides 37-41] Appendices Detailed finance schedules [Slides 42-53]. SECTION 1 – SUMMARY.

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Finance Report Month 9 2011-12

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  1. Finance ReportMonth 9 2011-12 Jonathan Wise, Director of Finance & Performance

  2. NHS HARROW FINANCE REPORT 11/12 - CONTENTS • Summary [Slides 3-7] • M9 Position [Slides 8-36] • Forecast outturn position [slides 37-41] • Appendices • Detailed finance schedules [Slides 42-53]

  3. SECTION 1 – SUMMARY

  4. EXECUTIVE SUMMARY • The month 9 report includes performance against QIPP. The Month 9 and forecast outturn (FOT) variances have been analysed between QIPP/non-QIPP as per the table below: • The QIPP position is shown in detail on slides 33-36 • Overall at month 9 the position is break-even against plan. The forecast outturn at month 9 is also breakeven. • The forecast assumes that currently uncommitted amounts within acute reserves of £2.4m plus the balance of 0.5% contingency/reserves/QIPP re-provision costs (£2.2m) will be fully utilised. This remaining flexibility is as a result of the impact of acute contract caps, greater than anticipated in-year allocations, risks not materialising that have required use of contingency and slippage in the implementation of some QIPP initiatives. The in-year benefit from the contract caps is currently forecast at £4.2m, which without the cap, would have utilised both the remaining acute reserve plus the contingency. • The potential commitments against the remaining contingency/reserves are primarily in respect of non-recurrent investments relating to QIPP delivery and improving performance in Q4, estimated at £0.75m, together with other liabilities currently estimated at up to £3.9m. • The forecast assumes budget outturns as per current forecasts, which are in the process of being validated with managers, and no further unplanned allocations are received.

  5. FINANCIAL PERFORMANCE SUMMARY (1) YTD FOT • Statutory duties • Underspend against revenue resource limit • Achievement of capital resource limit • Achievement of cash limit • Underlying recurrent position • Achievement of overall financial plan • Achievement of public sector payment policy • Achievement of 11/12 QIPP plan • CCB delegated budgets G G G G G G R R G G A A G G G G

  6. SUMMARY OF MONTH 9 AND FORECAST OUTTURN • Year to Date position • The year to date position at month 9 is breakeven, made up of overspends of £2.4m on acute commissioning, £0.3m on prescribing and £0.1m on Estates offset by underspends on community services of £1.2m, joint working of £1.0m, public health of £0.2m and contingency of £0.4m. • Forecast outturn position • The forecast outturn position is breakeven. This is made up of forecast overspends of £0.4m on primary care, £0.3m on prescribing and £1.9m on acute commissioning offset by forecast underspends of £0.8m on joint working, £1.4m on community services and £0.4m contingency. • CCB Delegated budgets • At month 9 the CCB delegated budgets are underspent by £0.1m, made up of a £0.1m underspend on Direct Access and a £0.1m underspend on contingency offset by an overspend of £0.1m on prescribing.

  7. UNDERLYING (RECURRENT) FINANCIAL POSITION • In order to understand the financial position of the PCT, it is important to distinguish between recurrent (underlying/run rate) and non-recurrent (one-off) income and expenditure items as it is the recurrent position that is core determinant of on-going financial sustainability; • The year-end outturn, adjusted for the major one-off items is set out below: • £m • Year-end outturn 0 • Adjusted for Sector support (20.2) • Return of 2% funding (5.3) • 10/11 Surplus c/f (0.7) • Other non-recurrent items (1.2) • Underlying financial surplus/(deficit) (27.4) • The movement in the underlying position between M8 and M9 is as follows: • - Month 8 Underlying financial deficit (27.6) • - decrease in non-recurrent budget (0.1) • - decreased benefit from contract caps 0.3 • - M9 Underlying financial deficit (27.4)

  8. SECTION 2 – MONTH 9 POSITION

  9. OVERVIEW OF BUDGET POSITION AT MONTH 9 • Budget changes are shown below:

  10. GP DELEGATED BUDGETS – MONTH 9 • The Year to Date position reflects Month 7 Expenditure projected to Month 9 • The Annual Budgets reflect the revised Annual Budgets as at Month 7

  11. SUMMARY OF YEAR TO DATE VARIANCES - MONTH 9 Explanations for the main variances are included on the following slide.

  12. SUMMARY OF YEAR TO DATE VARIANCES (1) Acute Commissioning £1.8m unfavourable - Currently 10 out of the 23 NHS acute contracts are showing over-performance at month 8 (of greater than £50k). These are at North West London Hospitals (£3.5m), RNOH (£0.7m), Royal Brompton & Harefield (£0.8m), Chelsea & Westminster (£0.4m), Guys & St Thomas’ (£0.2m), Imperial (£0.4m), Royal Free (£0.6m), Moorfields (£0.2m), UCLH (£0.2m), Royal Marsden (£0.1).In addition there is over-performance at BMI (£0.3m) and a shortfall on acute QIPP stretch target (£0.9m) and underperformance at Hillingdon £0.1m and Whittington £0.1m. The overspend has been reduced to (£1.8m) after factoring in £6.4m of the annual in-year risk reserve of £6.9m. Other Acute Commissioning £0.5m unfavourable - This includes London Specialist Commissioning Group (Acute), Other Specialist Commissioning for Acute, Cost per Case, High Cost Drugs and Non Contracted Activities. At month 9 the most material overspends are in High Cost Drugs (£0.2m) NCAs (£0.2m) and Cost per Case (£0.2m). Joint Working Commissioning - £1m favourable - This relates to under spending on various services, which are detailed later. Community Commissioning £1.2m favourable- This includes the various Community services plus UCC, NCA and Hillingdon wheelchair services and the Primary Commissioning Services which includes Physiotherapy, CAS, SPA and the referral management centre. At month 9 the favourable position is due to under spending on various services, which are detailed later. Prescribing (£0.3m) unfavourable - Unfavourable position at month 9 relating to April to October 2011 data. Expenditure relating to month 8 and 9 is estimated based on PPA forecast expenditure for those months.

  13. SUMMARY OF YEAR TO DATE VARIANCES (2) Primary Care (£0.1m) Unfavourable – Medical contracts are under spending by £0.1m due to savings from list reductions, seniority payments and greater than budgeted income collection from primary care walk-in-centres. Dental contracts also under spending by £0.2m due recovery of under performance from 10/11 . Pharmacy contracts are over spending by 0.3m due to higher payments for community pharmacists as per Community Pharmacy Contractual funding changes for 11/12. Ophthalmic contracts are over spending by £0.2m due to increased activity and QIPP target not being met. Estates Costs (£0.07m) unfavourable - This includes the various sites including Alexandra Avenue, depreciation and cost of capital. The overall budget is over spent due to due to increased service costs, maintenance contracts and telephone costs across a number of sites including Alexandra Avenue, Kenmore, Waverley, Wealdstone and Pinn Medical. Corporate Costs (£0.08m) favourable - This includes the share of sub-cluster costs, turnaround support and Clinical Commissioning. The under spend is due to additional budget added to the Turnaround support. Public Health (£0.1m) favourable - This includes drugs & alcohol, LSG Public Health, Childhood Immunisation, Termination of Pregnancy, HIV and Health Promotion. There are under spends on Childhood Immunisation of £0.06m, LSG Public Health of £0.02m, Public Health Performance of £0.03m and HIV of £0.03m. General Reserve / Contingency (£0.4m) favourable - £0.4m of the £1.8m contingency budget has been factored into the year-to-date position.

  14. ACUTE CONTRACT POSITION – MONTH 9 • Figures used have been based on Month 8 Trust reports as reported by the ACV • Year to date reported Trust figures exclude ACV Challenges which have not yet been incorporated or accepted by the Trusts and the impact of any agreements (“caps”) connected with non recurrent support for NWLHT and Imperial • Out of Sector contracts - reflects latest position from ACV for contracts and Trust reported figures for actual values. • Total YTD performance: £7.1m overspend (before reserves have been factored in) • Forecast Outturn (FOT) position: £1.2m over-performance. Extrapolating the YTD position to year-end and applying contract caps, gives an overspend of £5.7m (3.4%) which is offset by releasing £4.5m of the in year risk reserve to forecast an over-performance of £1.2m. An in –year over-performance risk reserve of £6.9m, equivalent to 4.0% of the acute contract baseline, has been set aside to manage contract over-performance.

  15. ACUTE CONTRACT POSITION – MONTH 9 • The Year to Date Analysis is based on Month 8 Performance Reports for each Trust forecasted to Month 9. • There are two Out-of Sector 11/12 contracts which have not yet been agreed, which are UCLH and Royal Marsden, as the lead commissioners have yet to agree a contract with these providers. Where the contract value is not yet available the month 8 position is based upon estimated values.

  16. ACUTE CONTRACT POSITION – MONTH 9 Analysis of (Over)/Under Performance by Point of Delivery (POD) (£’000) The above table analyses under/(over) performance by POD by Trust. Over performance in excess of £20k has been highlighted in yellow. The Year to Date Analysis is based on Month 8 Performance Reports for each Trust forecasted to Month 8. A commentary on material over performance at the month 8 position reported by Trusts is on the following slide.

  17. ACUTE CONTRACT POSITION – M8 TRUST REPORTS (1) The following tables reflect the latest available contract data from Trusts which is month 8

  18. ACUTE CONTRACT POSITION – M8 TRUST REPORTS (2)

  19. ACUTE CONTRACT POSITION – M8 TRUST REPORTS (3)

  20. ACUTE ACTIVITY ANALYSIS - MONTH 9 • The following graphs compare monthly activity levels in 2011/12 with 2009/10 and 2010/11. There may be differences in the variances shown in slide 16 and the following slides due to: • Non PbR spend areas such as Critical Care, Excluded Drugs & Devices, Direct Access, Renal and Other Exclusions are not reflected in the Acute Activity Analysis graphs. Also Accident and Emergency activity is not reflected in the Acute Activity Analysis graphs; • The following slides show actual activity changes year on year: - outpatients 4.5% increase (excluding CAS services) • - elective admissions have increased by 9.7% • - non-elective admissions have increased by 2.1% • - births have decreased by 2.5%

  21. ACUTE ACTIVITY ANALYSIS (1) - OUTPATIENTS Against the comparative period of April-November 2010/11, there is an increase in activity of 4.5%. This excludes community outpatients activity seen by the CAS services which is currently unreported on SUS.

  22. ACUTE ACTIVITY ANALYSIS (2) - ELECTIVE Against the comparative period of April – November 2010/11, there is an increase in activity of 9.7%.

  23. ACUTE ACTIVITY ANALYSIS (3) – NON-ELECTIVE Against the comparative period of April – November 2010/11 , there is an increase in activity of 2.1%.

  24. ACUTE ACTIVITY ANALYSIS (4) – BIRTHS Against the comparative period of April – November 2010/11, there is a decrease in activity of 2.5%

  25. SPECIALIST COMMISSIONING – LSG REPORT M7 LSG Report is unavailable for Month 8 therefore the figures reported are based on Month 7 LSG Report depicts a favourable variance of £767k at month 7 Main areas of underperformance are Forensic MH, Haemophilia and Adult BMT however, Spinal is over-performing Forensic MH is showing an underspend of £117k, Haemophilia £165k, and Adult BMT £127k, offset by an overspend of £64k on Spinal FOT position at month 7, after risk share agreement is applied, is £146k favourable

  26. SPECIALIST COMMISSIONING – LSG REPORT M7 N.B. Figures reflect Month 7 data

  27. JOINT WORKING VARIANCES – MONTH 9 Joint Working Commissioning is showing a £1m under spending, and is made up of the following areas: – - Continuing Care Adults is showing a £0.6m under spending. This is due principally to changes in spending in Nursing Care, Adult Mental Illness, Elderly and people with Physical Disabilities. - Continuing Care Children is showing a £0.1m over spending. This is due principally to increased pressure on care packages. - Intermediate Care is showing a £0.5m under spending. This is due principally to lack of use of spot placements for such care £0.2m, an under spending of £0.2m on Harrow Joint Finance and under spending of £0.1m on Minor Budgets. - End of Life is showing an under spending of £0.04m in month 9. - Mental Health Providers is showing an over spending of £0.07m in month 9.

  28. COMMUNITY SERVICES VARIANCES – MONTH 9 • Community Services Contracts £0.6m favourable. The principal reasons for the under spending are the Urgent Care Centres (Ealing) being £0.7m under spent and the CNWL/Hillingdon Community Services being £0.1m under spent. However, the Ealing ICO/Harrow QIPP target is showing and adverse balance of £0.2m, and the Hillingdon Wheelchair Service is showing an adverse balance of £0.2m. Other budget headings in Community Commissioning show insignificant variances, making up the total under spending. • Primary Commissioning Services £0.6m favourable – This is due to under spends in CAS cost of projects £0.2m and Referral Management Centre £0.4m.

  29. PRIMARY CARE VARIANCES - MONTH 9 • Prescribing (£0.3m)Unfavourable - GP Prescribing budget is over spending by £0.1m for the period. Central drugs are over spending by £0.1m and other prescribing overspending by £0.1m. • Primary Medical Service (£0.13m) Favourable - due to over achievement of Walk in centre income and savings from baseline payments due to list reduction. • Dental Contract (£0.23m)Favourable – This is due to the recovery of income from 10/11 under performance. • Pharmacy Contract (£0.28m) Unfavourable – Pharmacy contracts are over spending by £0.3m due to higher payments for community pharmacists as per DOH guidance. • Ophthalmic Contract(£0.16m) Unfavourable – April to November payments were more than the budget and the anticipated QIPP savings not being achieved.

  30. CORPORATE, ESTATES & PUBLIC HEALTH VARIANCES – MONTH 9 • Estates (£0.07m) Unfavourable – The Estates are showing a unfavourable position due to overspends across some of the sites. • Corporate Service £0.1m favourable – small underspend on Turnaround support. • Public Health (£0.15m) Favourable – This is due to the Childhood Immunisation showing an underperformance of £0.06m ,LSG Public Health underperforming by £0.02m, HIV underperforming by £0.03m, Public Health Performance under spent by £0.03m and IUCD £0.01m underperformance.

  31. BALANCE SHEET AT 31 DECEMBER

  32. BETTER PAYMENT PRACTICE CODE (BPPC) PSPP is being achieved in two out of four categories. Note: Figures include performance on commissioning (plus Harrow provider services invoices relating to 10/11)

  33. QIPP PROGRAMME SUMMARY • The Bottom-line QIPP position is shown as follows: The following slides provide a scheme-by-scheme analysis of the QIPP programme

  34. QIPP PROGRAMME (1)

  35. QIPP PROGRAMME (2)

  36. QIPP PROGRAMME SUMMARY FOT • Full year plan = £14.0m • Current FOT including benefit of non recurrent contract caps of £2.2m = £14.1m • Improved QIPP performance from month 5 to month 7 with a slight decrease in month 8. • There would be an under achievement on plan of £2.2m if there were no contract caps in place • Total FYE of 11/12 performance = £16.5m including FYE impact of £4.7m

  37. SECTION 3 - FORECAST OUTTURN

  38. SUMMARY OF FORECAST OUTTURN VARIANCES Explanations for the main variances are included on the following slide.

  39. SUMMARY OF FOT VARIANCES (1) Acute Contracts £1.2m unfavourable – The FOT is shown as £1.2m unfavourable after extrapolating the in-year positions, adjusting for NWLHT challenges, contract caps and the partial utilisation (£4.5m out of £6.9m) of the acute contract in-year risk reserve. Other Acute Commissioning £0.7m unfavourable – The most material variances projected are a £0.2m overspend relating to High Cost Drugs, a £0.3m overspend relating to Cost per Case Acute and an underspend of £0.2m on NCAs. Joint Working Commissioning £0.8m favourable – The FOT is set at £0.8m favourable due to a projected under spending on Continuing Care (Adults) at £0.7m,a projected under spending of £0.2m on Intermediate Care (Spot Placements), a projected under spending of £0.2m on Minor Budgets and a projected under spending of £0.06 on End of Life. Mental Health SLA`s is showing a projected over spending of £0.2m, and Continuing Care (Children) is showing a projected over spending of £0.1m. Other budget headings are projected to break even. Community Commissioning £0.7m favourable. – Community Services contract - The FOT is showing a projection of £0.7m favourable due principally to the projected under spending on the Urgent Care Centres of £1m, CNWL/Hillingdon Community Services shows a projected under spending of £0.2m, CLCH/Barnet Community Services shows a projected under spending of £0.1m,similar to the under spending on Non Commissioned Activity (NCA`s) An unfavourable variance of £0.4m is projected for the Ealing/ICO Harrow QIPP target, and unfavourable variance of £0.2m shown for Hillingdon Wheelchair Service. Prescribing (£0.3m) Unfavourable – Forecasted £0.1m unfavourable from information provided by PPA for October as per their forecast outturn and also over spend £0.2m from central drugs and other prescribing.

  40. SUMMARY OF FOT VARIANCES (2) Primary Care Primary Medical Service – Breakeven – This is predominantly due to savings from baseline payments due to list reduction and also due to decreased payments than budgeted in areas such as seniority and parental leave payments. These savings are offset by non achievement of QIPP in walk in centre redesigning & PBC LIS. Dental Contract (£0.4m) Favourable– This is due to the contract claw back for non achievement of dental targets for 10/11. Pharmacy Contract (£0.6m)Unfavourable – Based on DH prediction tool and as per Community Pharmacy Contractual funding changes for 11/12. Ophthalmic Contract(£0.2m) Unfavourable – This is due to QIPP targets not expected to be met and also due to increase in the activity related payments from 10/11. Estates (£0.9m) Unfavourable – This is due to overspends across the sites including Alexandra Avenue, Kenmore Lane, Wealdstone, Waverley and Pinn Medical Centre due to a number of reasons including increased utility costs. Corporate Costs Breakeven - The FOT is expected to be breakeven Public Health (£0.15m) Favourable – This is due to Childhood Imms, Public Health Performance and LSG Public Health underperforming at this stage. Reserves/Investments £0.4m favourable – £0.4m of the £2.5m contingency, investment and reserves budget has been factored into the forecast outturn position.

  41. CAPITAL FORECAST OUTTURN • The capital programme of £475k, as approved by the sub-Cluster capital and estates group, is forecast to be breakeven. The following budgets are expected to be fully utilised. • Boiler Room Replacement Carol Thomas £54.5k • Boiler Room Replacement Belmont £54.5k • GP Computer Replacement Programme £126k • The Heights computers £20k • Capital Grant to EACH £45k • Capital Grant to COMPASS £175k

  42. APPENDIX A – FINANCIAL SCHEDULES

  43. NHS HARROW SUMMARY - MONTH 9

  44. ACUTE - MONTH 9

  45. JOINT WORKING - MONTH 9

  46. PRIMARY CARE - MONTH 9

  47. PRESCRIBING – MONTH 9

  48. COMMUNITY SERVICES - MONTH 9

  49. PUBLIC HEALTH – MONTH 9

  50. ESTATES – MONTH 9

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