Introduction: bringing budgets together for coordinated care

England’s health and social care challenge is significant, and accelerating in complexity and intensity. The scale of the financial and delivery challenge is well documented, both within the NHS and local government. To meet the health challenges of the 21st century, health and social care systems will need to do things differently and use funds more effectively to deliver sustainable, person-centred, coordinated care at scale and pace.

A key element of the Better Care Fund programme has been the pooling of a proportion of budgets between health and social care organisations. The NHS Long Term Plan also provides a continued commitment towards supporting local approaches to health and social care budgets where councils and ccgs agree this makes sense.

This guide focuses on bringing budgets together and using them to develop coordinated care provision. It sets out tips, tools and practical examples of how resources can be aligned in a more effective way, enabling health and care areas to provide better person-centred and coordinated care. It covers:

• building trust and anchoring pooled budgets in a shared definition of outcomes
• agreeing joint budgets and risk share between commissioners
• payment models: developing the model with providers
• contracting models: awarding the contract and monitoring impact.

The guide is aimed at finance leads and strategic and operational leads across health and care organisations. It identifies opportunities for how resources can be aligned in a more effective way to provide integrated, person-centred care. It focuses on the budget elements outlined in the process for developing integrated models of care.

The process for developing integrated models of care

Bringing budgets together is complex and requires strong system leadership and management. A good starting point is to build a clear common purpose about the outcomes providers are trying to achieve for their local population, and how they want to reshape services to meet them.

Building trust and defining outcomes

• Develop a shared vision of change.
• Clearly define outcomes and objectives.
• Build a business case for change.
• Form close relationships across the system.

Joining up budgets and agreeing risk share

• Define pooled budgets for the population.
• Agree how risk will be shared between commissioners.
• Document changes in joint funding agreements.

Selecting the right payment models

• Agree contractual models and financial mechanisms.
• Develop new models of care, working with patients, people who use services and carers.
• Develop GP and provider networks.

Contracting options

• Agree how investment and risk is shared through payment and contracting models
• Use capitation allocation to cover service user care
• Measure outcomes and evaluate progress (Also see How to… understand and measure impact guide.)

Key messages

1. Work with partners and other stakeholders to build a shared vision, with a shared narrative for change.
2. Build a business case with evidence of the as-is situation and clear articulation of the changes required, with cost and benefit assessment and a realistic plan for benefit realisation.
3. Clarify accountabilities and agree arrangements for risk–benefit sharing. The joint funding agreement should have clear documentation of the aims and outcomes, governance arrangements, respective contributions from partners, expected benefits and benefits share, risks to benefit realisation and how they will be managed.
4. Trial and test a range of payment and contract models, building on learning and evidence from within the area and elsewhere.
5. Review performance on a regular basis and assess progress against the planned changes. Build in review processes to review risks and agree mitigating actions where required.