11 Jun 2018

At the recent Board meeting, NHS England and NHS Improvement announced a further four accelerated Integrated Care Systems (ICS), bringing the total up to twelve. Is this a ringing endorsement of their success to date or a last throw of a dice to prove the concept is the only game in town?

For suppliers and partners to the NHS (such as pharmaceutical and medtech companies), the difficulty of identifying permanence in policy or in emerging structures is a constant challenge. However, short- and medium-term commercial success may depend on making the right call early and gaining the advantage as one of the ‘first movers’ in this new landscape.

To help with these decisions, we might look at the way in which many other countries, both developed and developing, are balancing the challenge of health and care demand with governments’ inability to provide the necessary funding.

The current policy direction is characterised by a number of defining features, consistent with the conceptual vision of the Five Year Forward View:

  • Reducing the fragmentation of commissioning budgets into larger ‘place-based budgets’
  • Moving from episodic and transactional contracting to longer-term, more outcomes-focused ones
  • Aligning incentives for providers through the creation of ‘provider alliances’
  • Finding ways to integrate services that target mental, social and physical needs
  • Investing in data and new technology to help stratify populations, predict demand and target resources
  • Developing bigger and more strategic commissioning organisations that are able to hold providers to account

The fact that nowhere in the world is setting out on a different course strongly suggests that ICSs in the NHS are here to stay.

Furthermore, whatever the Cabinet agrees as a new NHS funding settlement will inevitably come with strings attached. The Department of Health & Social Care and HM Treasury will want to see “reform” implemented alongside the funding. NHS England will likely be tasked with establishing ICSs across the whole of the country.

On that basis, potential partners and suppliers to the NHS really need to understand and engage with the process of integrated care and the emerging structures: localised provider alliances and strategic commissioners.

If the ICS policy is implemented along the lines seen internationally, partners and suppliers to the NHS will need to adopt a number of new approaches, such as:

  • Revisiting their value proposition to connect to the increasingly important task of population health management
  • Identifying who the new decision-makers are in this new system (increasingly, this will likely shift to the provider alliances and away from commissioners)
  • Offering a service to sit alongside their product to help ensure best value
  • Recognising that the purchasing landscape for ICSs is likely to have a larger footprint than current individual organisational boundaries. While this will provide larger-scale deals, suppliers may also risk losing market share more rapidly if unsuccessful

There is much to do and learn, but the main message is simple – ICS development is set fair in the policy framework, and its consequences are likely to be significant. Don’t treat this as just a passing policy fad.

Mike Farrar is a Senior Adviser at Hanover Health.