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Interview: Sir David Nicholson

Interview: Sir David Nicholson

Interview: Sir David Nicholson
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Before the interview begins, our photographer David asks his namesake for some help to secure the best shots. "Perhaps you could move your arms around a bit while you talk," he suggests. Sir David Nicholson, who is polite and engaging throughout our conversation, looks momentarily put out. I doubt he's used to being spoken to like this.

It's not really surprising. As the NHS in England undergoes such a radical transformation, one thing the coalition government has no intention of changing is the man at the top.

Before the interview begins, our photographer David asks his namesake for some help to secure the best shots. "Perhaps you could move your arms around a bit while you talk," he suggests. Sir David Nicholson, who is polite and engaging throughout our conversation, looks momentarily put out. I doubt he's used to being spoken to like this.

It's not really surprising. As the NHS in England undergoes such a radical transformation, one thing the coalition government has no intention of changing is the man at the top.

Indeed, it is arguable that Nicholson, ordained Chief Executive Designate of the NHS Commissioning Board (NCB) in 2010 without a formal appointment process, will have even more power over the health service than he has held for the last five years as NHS Chief Executive (a position he retains until the formal establishment of the NCB next year).

Even for such a 'big beast', the new position gives him quite considerable responsibilities. The NCB will, after all, take control of an £80bn budget, overseeing the £60bn allocated to CCGs and using the remainder to commission services itself.

Added to this is the need to ensure high-quality services and outcomes across the NHS while meeting the £20bn savings cuts target by 2014. Great power and great responsibility are indeed intertwined.

Development of the NCB will soon start to pick up pace. It is now scheduled to operate in shadow form as a special health authority and, subject to the passage of the Health and Social Care Bill, is expected to become an independent statutory body in October 2012.

It will then begin the task of providing authorisation to CCGs. According to current estimates, the NCB will employ 3,500 staff (two-thirds of which will 'manage relationships' with CCGs and perform direct commissioning functions). The NCB is expected to be fully operational by April 2013.

This was supposedly the final deadline for all CCGs themselves to be up and running. But that deadline has now been scrapped and CCGs will only take on budget responsibility when they are "ready and willing" to do so.

If this means Nicholson is more relaxed about the pace of change, he doesn't show it. "My ambition is to get everybody up and running by 1 April 2013," he says. "If we genuinely believe that clinical commissioning is the best way of improving services for patient outcomes, we want to drive that process and make it a reality."

But is it realistic to expect all areas to have fully operational CCGs by then? Without an established deadline, some GPs may find less incentive to move forward. Nicholson points to the 97% coverage achieved in the summer by the fifth wave of pathfinder CCGs ("a remarkable figure… and all credit to those who put their heads above the parapet" he says) but he is not complacent.

"Clearly there'll be some [CCGs] that won't make it, but we want to keep those to a minimum, and we want to support and help them through it," he says. "But I will be very disappointed if by the middle of 2014 if not every area has a functioning CCG."

Many criticised practice-based commissioning (PBC) for lacking the carrot-and-stick incentive for localism, which allowed something approaching of a patchwork of take-up across the country. Could history repeat itself if CCGs are not pushed to reach a uniform standard?

"Even in primary care trusts (PCTs), there's a range of capability," Nicholson says. "So you'll always get a variation in performance in that regard. I don't think that adds up to a 'patchwork' though. But the risk is this: if we don't put the effort, time and resources into getting the clinical commissioners up and running then that risk is there. But we need to mitigate it and I'm absolutely determined that won't be the case."

Difficult relationship?
GPs will inevitably now be hearing a lot more from Nicholson, his current role as NHS Chief Executive notwithstanding. The relationship with the NCB and CCGs will be crucial to the wider success of the health service, but tensions may be fraught.

Nicholson hints at this through humour when he says GPs are central to commissioning plans "not because we particularly love GPs – although we do of course, but not all of them", but rather for their population-based health role in "navigating patients through the health environment".

"That gives them a unique insight and a unique take on services," he says. "But just GPs [on CCG boards] is not enough. You do need secondary care and nursing and multi-professional support."

One of the great challenges for the NCB, it would seem, lies in its dual role – the pledge to support and encourage GP commissioners sits uneasily alongside the board's requirement to hold underperforming CCGs to account. "One is soft and cuddly, and the other is hard and painful, potentially," David Stout, PCT Network Director at the NHS Confederation, told GP Business earlier this year.

Nicholson appears to support this notion of duality when discussing another apparent contradiction: that of a national body overseeing local commissioners. When PCT clusters were told to follow a "single operating model" in a document outlining the development of the NCB in July, fears were raised that this could potentially mean stamping out local innovation.

Nicholson insists this model has nothing to do with universal imposition. "The Commissioning Board is there to help clinical commissioners be as successful as they can possibly be – not to boss them around," he says. "And so we want to encourage and support local innovation.

"However, we are in a 'National Health Service – there's an 'N' in it. So we expect a consistency of delivery for patients locally, and we don't want CCG 'X' to aspire to provide different outcomes for stroke patients than CCG 'Y'. We want them to improve stroke services for patients across the board.

"So the relationship they have with the NCB should be the same. That's what I mean by 'single operating model'. It's for the NCB itself, not the CCGs, who will have different operating models depending on their locality."

Bureaucratic interference?
Several primary care bodies have voiced concerns that the increasing number of bodies in the commissioning structure could undermine CCGs' power. This is such a concern 
that the NHS Alliance and the National Association for Primary Care (NAPC) joined forces in September to "champion" CCGs.

"We are seeing many obstacles, from all quarters of the NHS and elsewhere, being placed to deter and restrain the successful engagement and operation of CCGs," says Dr Johnny Marshall, NAPC Chair. Dr Michael Dixon, NHS Alliance Chair, recently suggested that CCGs could be placed at the "bottom tier of a commissioning hierarchy".

It certainly looks as if CCGs are operating in a crowded space. Not only will they be overseen by the NCB, but PCT clusters, new 'clinical senates' (networks of clinicians proposed by the Future Forum) Health and Wellbeing Boards (HWBs) and local authorities lead many to fear CCGs face overbearing pressures.

"The biggest danger is we try to please so many people that we end up with a system 'made by committee'," says Dixon. "I feel concerned when a CCG leader writes and says: 'Too often I hear that previously enthusiastic GPs are losing the will to live with all the bureaucracy and top-down guidance'".

Perhaps predictably, Nicholson rejects the suggestion that conflicting forces will dilute CCGs' power. Speaking of the above organisations mentioned, he says: "I don't think they're in conflict. Inevitably when you're managing a transition of the largest integrated healthcare system in the world, you're going to have some overlap during that period."

Of clinical senates, he maintains these will be a supportive development. "I think having a group of clinicians that you as a CCG can ask for advice to help you commission your services is really important. So I don't think they are different things and I think if we manage them properly they don't need to be bureaucratic."

But when it comes to HWBs, he doesn't seem so sure. Ostensibly to ensure that CCGs play a greater role in public health, the government announced in June, again following the Future Forum's recommendation, that HWBs would have the right to refer back local commissioning plans "not in line with the health and wellbeing strategy".

"GPs, I'm sure, know how important [public health] services are and how significant they are for patients, so they'll want to engage with [HWBs]," says Nicholson. 
 "But they need to engage with them as partners. If [CCGs] get the idea that the HWB is trying to oversee them then I think we've got a real problem. They are partners. That's why we don't have any rights of veto."

He even warns against warring between CCGs and HWBs: "If we get into potential supervisory arrangements we've got real problems, and we need to make sure that doesn't happen. If we organise ourselves properly it won't happen."

Nicholson admits: "If I was in a CCG I'd be slightly worried about local governance and HWBs and all of the things around their plans. But I don't think they need to be, because the Commissioning Board is there to support them anyway." But will this be enough to reassure the CCG leaders Dr Dixon speaks of?

Hard taskmaster
Another concern for GP commissioners is the £20bn savings directive, famously dubbed the "Nicholson challenge" by Health Select Committee Stephen Dorrell MP, after the NHS chief set out the scale of the task in his 2009 annual report.

How does he feel about such a personal association? "I understand what politicians might want to do by pointing at me in terms of the challenge," he says. "All I did was set out what we will need to do over the future, based on the financial circumstances the NHS finds itself in." Does he take ownership of the task? "If that is owned only by me, we've got a big problem," he says. "It needs to be owned by everybody. It needs to be owned by the CCGs, by the pathfinders, by the NHS providers. Because only that way will we deliver quality and productivity."

There is, he says, "no alternative" but for the NHS to deliver these savings. That £20bn sum might seem overwhelming, but Nicholson insists it will not be down to CCGs to find this amount of savings – only 20% of that £20bn will be about what he calls "service change" (40% will be delivered nationally by, for instance, reducing the DH's budget and through pay freezes, and the other 40% is accounted for by "operational efficiency" – eg, procurement savings, reducing inpatients' lengths of stay, etc).

Of course, that still means CCGs' service changes will account for £4bn of savings. So what can GPs do to make serious inroads here? "It's all about redesigning your service so people with multiple long-term conditions (LTCs) do not have continuous acute episodes where they end up in hospital," says Nicholson. "We know a third of our patients at any one time in hospital have more than four LTCs, so doing that is the best way for the CCGs to make a contribution to that £20bn."

Commissioning outcomes frameworks and the 'quality premium' will encourage GPs to do this. But the latter has sparked outrage at the suggestion GPs will receive a 
financial bonus for cutting patient resources, with GPC 
Chair Dr Laurence Buckman calling it a "nasty little idea" (see interview this issue).

So, is it ethical to reward GPs for their CCGs' financial management? Nicholson says taking account of resources is "part of the responsibilities of any doctor. It's part of the GMC arrangements because if you use a lot of resources you're depriving other people of those resources."

But isn't it possible that the financial reward could be an incentive to deprive patients of those resources? "All we're trying to do in relation to the premium is to reward those CCGs who get better outcomes for their patients within the resources that are made available to them," he says. "I don't think that's a revolutionary or dangerous thing, I think it's a perfectly common sense thing."

He suggests there is more work to be done with the development of the premium, a topic that will no doubt be discussed at the House of Lords. "What we need to do, I think, is design a system where people don't feel that they will lose the confidence and support of their patients because their patients will be constantly thinking, 'Is this person doing it because they're trying to save money or not?' And I think we can come up with a set of arrangements that satisfies GPs but also gives incentives.

"Because what we want to do is reward those CCGs who take action to significantly improve the quality and outcomes of services for patients. Now, the obvious thing would be to reward them in such a way that they could then invest that resource in improving services for their patients, so I think it's perfectly possible to design a system that could do that."

Parting shot
The need to spur clinicians into delivering cost savings is clearly driven by financial imperative. The health service has never been in such a tight corner and Nicholson makes no bones about this. "We have never delivered savings on this scale before or have been as ambitious about what we need to do," he says.

However, he remains confident. "We've got the best advice that we can across the world about how to do this, all the commentators have all looked at our plans and they've all said we're in the right place and it is deliverable. But it's going to take a huge amount of effort to make it happen."

Our interview concluded, Nicholson departs but not before asking our photographer: "Did I wave my arms around enough?" Just like that snapper, GPs and CCGs 
could well discover that this big beast, ultimately, will have the last word.

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