Final talks over £6.4m Herefordshire health service contract dispute

Standoff between Herefordshire's two health bodies over services for 2014/15

Standoff between Herefordshire's two health bodies over services for 2014/15

First published in News
Last updated
Ledbury Reporter: Photograph of the Author by , Senior Reporter

TALKS to secure cash for community health services in the county over the coming year will go to the wire.

Some £6.4m is at stake with Wye Valley NHS Trust  (WVT) and Herefordshire Clinical  Commissioning Group (HCCG)  at odds.

HCCG buys and shapes health and care services for the county, WVT provides acute, community and social care

If both bodies can’t agree the correct funding of the community health services contract, valued at £4.3m, and four disputes worth £2.1m relating to the application of the national tariff -  a set of prices and rules to help HCCG work with WVT on service provision – then the dispute will go to arbitration.

This afternoon (Thurs), the WVT board heard that the outcome of arbitration was crucial to the Trust’s 2015-15 budget that already projects a deficit of £9m.

WVT, HCCG, NHS England (NHSE) and the Trust Development Authority (TDA) have been locked into talks over recent months without reaching agreement.

NHSE and the TDA expected  that all contracts would be signed by February 28 and that a failure to achieve this would see WVT and HCCG  subject to a disputes process.

Howard Oddy, WVT director of finance, told the board a final round of talks was scheduled for Monday.

If agreement could not be reached arbitration was scheduled to start on Tuesday afternoon and a decision expected with 24 hours, he said.

With no appeal, both WVT and HCCG would then have until next Friday (April 4) to present final submissions.

HCCG wants to reduce its contract with the Trust by £3.2m.

The board was told that the Trust was “not confident” that HCCG’s QIPP (Quality, Innovation, Productivity and Prevention) programme would deliver the reduction in activity it intends, so the Trust had to assume it can recover this “lost” income through contract over-performance - a risk to the Trust of £3.2m.

At the same time the Trust is trying to secure agreement from HCCG over funding for improved stroke services.

WVT has asked for an extra £600k it thinks is needed to deliver a specified level of service and the board was told that while this sum is yet to be fully agreed, HCCG has indicated its broad support.

Other key contractual issues that need to be taken into account as posing a potential risk to the Trust are CQUINS ( payments relating to quality improvements which are worth £2.5m to WVT) and an extension to fines HCCG can impose over contractual performance.

Previously, HCCG has re-invested fines in WVT, but this position could change over 2014/15 as the process moves to a rules-based system, leaving the Trust with a risk of over £550k  based on performance breaches this financial year.

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