Half of CCGs are expected to report financial deficits at the end of this financial year, which combined are expected to exceed £700m.
NHS England board papers said this will come despite £519m worth of budgetry cuts made by CCGs during 2017/18.
GP leaders have said the defict puts planned GP funding increases in doubt as CCGs ‘are left with little to invest in primary care’.
The papers state that 95 CCGs are predicting a year-end deficit of £291m on top of other budget risks that amount to £428m, which NHS England says are likely to materialise – amounting to a deficit of £719m.
At the NHS England board meeting, Paul Baumann, NHS England’s chief financial officer, said the deficits reflect ‘the underlying pressures’ facing the NHS.
He added: ‘It seems likely that most of the risks reported by CCGs alongside their core forecast will crystallise, taking the overspend for the year to over £700m.’
In an effort to fill the gap, NHS England launched a £400m ‘commissioner sustainability fund’ to help CCGs balance their books in 2018/19, which comes on top of a £600m increase to the CCG funding allocations for next year.
According to official guidance on the sustainability fund, CCGs are eligible for a cut of the money if the budget target they have been set by NHS England would still result in a reported deficit at the end of 2018/19.
NHS England sets budget targets by ‘taking into account each CCG’s financial performance in 2017/18’ with CCGs in deficit expected to reduce their spending ‘by at least 1%’ of their annual funding allocation from NHS England.
Mr Baumann added that the £400m fund is ‘clearly essential if we’re going to have a chance of successful financial management in the year ahead’.
But NHS Clinical Commissioners chief executive Julie Wood told Pulse that ‘the next financial year is likely to be as challenging as the last’ despite this extra funding.
Expecially, she said, since CCGs would have ‘additional responsibilities … such as meeting the mental health investment standard and investing in primary care’.
She said: ‘We need to see how the detail and criteria of the [sustainability] fund plays through in reality to CCG plans to deliver change as even with this extra funding it may prove challenging for some areas to achieve the financial balance at the end of 2018/19 that NHS England are looking for.’
This comes after Pulse revealed that 13 CCGs had yet to pass on to GPs the £3 per patient ‘transformation’ funding that was promised nearly two years ago in the GP Forward View.
BMA GP committee chair Dr Richard Vautrey said that the deficit was ‘unsurprising’ considering the lack of preparation for winter pressures.
He told Pulse the NHS is not being adequately funded ‘to effectively deliver services and given the unpreparedness to face the challenges of the busy winter months, it is unsurprising that many CCGs have run into financial difficulties’.
He said: ‘Ultimately, this is a wider reflection of the funding crisis which has for years been negatively impacting general practice, hospitals and community services.
‘The result is a damaging knock on effect as CCGs are left with little to invest in primary care and community services or deal with the workload pressures facing GPs.’
NHS England revealed last month that the proportion of centrally allocated funding for general practice is set to fall to 7.1% of the total NHS budget in 2018/19, from 7.2% in 2016/17 and 7.3% in 2015/16.
Desperate times, desperate measures?
In July, 23 CCGs were rated ‘inadequate’ on finance by NHS England with many saying at the time that they were still in the process of agreeing what action planned to take take. However, if the proposal by NHS St Helens CCG (to halt all GP referrals into their local hospitals over the winter) was anything to go by, CCG leaders could resort to desperate measures.
Although that plan was swiftly canned after GP leaders condemned the move, the CCG is continuing to consult on rationing IVF and cutting back on prescribing of over-the-counter medications and gluten-free foods.
Elsewhere, GP leaders have warned CCGs are being more covert in introducing rationing measures, such as NHS New Devon CCG’s scheme to ‘streamline’ urology referrals by letting GPs pick them up themselves.
More recently, two CCGs in Hertfordshire planned to ration a wide range of services in an effort to fill a funding gap of £550m by 2021.
The plans proposed to either reduce or scrap IVF treatment, while also requiring smokers or obese patients to quit or lose weight before being referred for non-urgent surgery.
Meanwhile, NHS Cambridgeshire and Peterborough CCG announced plans to scrap free IVF services until April 2019 in the face of mounting financial pressures, which came after Pulse reported that five CCGs have stopped funding for IVF treatment completely, which GP leaders have said leaves patients in an ‘unacceptable postcode lottery situation’.