Health and Social Care Act: CCG Governance

The New Commissioners

Now that the parliamentary process in relation to the Health and Social Care Bill has concluded, and the Bill has received Royal Assent to become an Act, we can see at least some of the shape of the new Clinical Commissioning Groups (CCGs). There is much that will be clarified through subsequent regulations and guidance but the outline of the structure and governance arrangements can now be considered confirmed.

Structure

The position in relation to form and structure for CCGs has largely been settled in that:

• they have to have a geographical area;
• all of England must be covered without overlaps;
• all designated holders of primary care contracts must be members of a CCG (and this will almost certainly be all holders of a primary medical contract for essential services)
• there is a requirement for a governing body, and both an accountable officer and a chief finance officer;
• the governing body has to have at least two lay members, who have to take specific responsibility for audit and governance and of public and patient engagement; and
• the CCG has to have its constitution authorised by the Commissioning Board, who has already produced an initial draft constitution.

However as those who have already looked at the Commissioning Board's draft constitution will agree there are a lot of questions still unanswered, either because they will be questions for local determination, or because they are dependent on yet to be published regulations.

Decisions, elections and the governing body

In terms of determining who may be a member of the governing body, regulations will provide for part of the detail, but the constitution can also make provision in relation to this. Some of the division between what has to be decided by the governing body and what needs to go to the members will be for local determination.

Decisions around appointments or elections to the governing body will also raise questions over the mechanisms used, for example:

• who votes and how;
• does each member GP practice have 1 vote or each GP or GP principal;
• should there be weighting of votes in relation to a member GP practice's list size; and
• should the same procedures apply to elections as to decisions of the CCG members such as that to approve the annual plan?

The level of thought that needs to go into the practical governance arrangements of CCGs will be great and inevitably there will be learning experiences from trial and error, but there is a real risk to those that do not seek input from skilled advisors that there will be gaps in their initial arrangements.

Relationships with member GP practices

The relationship with the member GP practices will also raise some complex questions. What, if any, authority does the CCG have over any member GP practice? Does it have sanctions? How can sanctions be exercised or challenged? Clearly to the extent that the CCG is taking proper decisions it may be able to reflect member GP practice performance in the additional premium, if the intention locally is for this to be distributed.

There have been suggestions of incorporating a power to expel a member GP practice but this is unlikely to be achievable. The member GP practices have to be listed in the constitution which can only be changed with the approval of the Commissioning Board. Further because the GP practices all have to be members of a CCG it will be difficult for the Commissioning Board to reallocate a GP practice. On this basis the sanction is much more likely to be an extreme one of the Commissioning Board looking to its remedies under the contract; with the ultimate sanction being termination of the contract for breach. Again this is a Commissioning Board decision, not one for the CCG.

The Model Constitution Framework

As Monitor has done for Foundation Trusts, the Commissioning Board has published a draft constitution in a model form which is subject to further development. It is intended to cover both what the Act requires for a constitution for the CCG and what the Commissioning Board considers to be otherwise appropriate.

The draft constitution, which is marked as subject to legal review, does raise a number of issues about the nature and purpose of the document. On the one hand it seeks to fulfil the function of setting out the structure and internal rules of the CCG, but it also includes a good deal of what might be described as public facing statements as to policy and intention, couched in some way in terms that potentially create additional obligations to third parties. A constitutional commitment to act in accordance with best practice in employment matters goes beyond what may actually be legally required.

The draft constitution follows the current Monitor practice of including the standing orders and standing financial instructions as part of the constitution, although the latter are renamed as the principal financial rules. It also includes the scheme of delegation and reservation of powers, and the way in which the draft constitution has been prepared appears to require the identification and terms of reference for all decision making committees and panels. This may be quite cumbersome, since any changes will of course need Commissioning Board approval.

A further interesting area in the draft constitution is the section relating to conflicts of interests.  As one might expect, given the attention to this topic in Parliament and sections of the press, it is quite extensive and includes helpful descriptions of what is an interest although the inclusion of friendship in the categories of relationship does make this very wide. The draft constitution also seeks to ensure that organisations providing commissioning support, or otherwise involved in or even seeking information in relation to, procurement will be required to make a declaration of interest. It is not clear what is meant by this. A bidder will have their own interest and it is unclear if they need to state this. Further, does the bidder need to disclose all of their other interests whether or not relevant and can they even do that without infringing data protection rules or individual’s privacy? Any one contracted to provide services or facilities to the CCG will be required to adopt the same provisions in relation to the management of conflicts of interest. If the intention behind this is to give the CCG governing body a say in the management of conflicts of interest in third parties this may be  a step too far.

How can we help?

The governance story for CCGs is yet to reach a conclusion and currently the Act and the draft constitution raise as many questions as they answer. We have looked beyond the Act to the post-reform landscape, which is indeed a changing one, where untested CCGs will soon have great power and budgets. We have been working with commissioners and other organisations effected by the changes ahead to advise on the future of commissioning, governance arrangements and how best put governance arrangements in place and prepare for the future.

Our commercial team would be happy to assist you with understanding the draft constitution, the implications the Act will have for existing and incoming commissioners and how best to prepare. We can also provide training and development support for commissioners to enable them to be ready for the new landscape.