Integrated Care Systems

As mentioned  on other pages, NHS England (NHSE) has divided the English NHS into 44 local health systems (‘footprints’),  now described as Sustainability and Transformation Partnerships (ST Partnerships). Initially, NHSE expected at least some of these Partnerships to evolve into what were then called Accountable Care Systems (ACSs), and that many of these would evolve into Accountable Care Organisations (ACOs). 

In 2018 NHS England renamed ACSs as Integrated Care Systems (ICSs), arguably because the term ‘accountable care’ had become rather toxic. But there was increasing confusion about what ‘integrated care’ meant and it was being interpreted differently in different places. Attempts to pin down ‘integrated care’ and the systems that were to provide this have been frustrating: NHSE and NHSI appear to change terminology when their plans become unpopular or ‘generate unwarranted misunderstanding’.  

Accountable Care Systems

Accountable Care Systems (ACSs) were introduced by NHSE as partnerships between Clinical Commissioning Groups (CCGs) and providers such as NHS Trusts, GPs and community healthcare providers within an STP.  These partners were expected to work together through, for example,

  • setting up collective decision-making and governance structures – not easy, given that, as an ACS was not a statutory body, it couldn’t replace the individual accountability of the organisations within it that were statutory bodies (such as NHS Trusts);
  • sharing their workforce and facilities, ‘where appropriate’;
  • agreeing how to share risk and gain;
  • agreeing a performance contract with NHSE and NHSI to deliver rapid improvements in care and performance; and
  • managing funding for a defined population through a ‘system control total’ (see below).

In return for providing ‘joined up, better coordinated care’, it was claimed that ACSs would  have more control over their funding and the operation of the health system in their area. In reality, ACSs provided a means by which national bodies (the Treasury, the Department of Health, for example) could assert more control, especial with regard to finances and performance.

A central feature of ACSs (and now a part of ICSs) was that they were largely funded by new ‘capitated payment’ arrangements, such as a ‘whole population budget’ (a fixed payment to the ACS to provide specified services for a defined, geographical population, for a set period of time). There are deep concerns, in the context of inadequate funding, that even if there are minimum standards in place, this type of payment system provides an incentive for rationing or for raising the threshold at which patients are offered treatment, irrespective of the care needed.

NHSE’s ambition was for ACSs to cover half the population of England by 2020, something it acknowledged would be a complicated transition, requiring a staged implementation.

First wave of ACSs 

By 2017 there were 10 pilot or ‘shadow’ ACSs across England, where NHS Trusts, local councils and others, including private providers, came together to manage resources collectively and deliver services to a specific population. Services could include hospitals, community services, mental health services and primary care, but could also involve social care. Four further ICSs were selected in 2018.

These shadow ACSs agreed, in principle, a draft Memorandum of Understanding (MOU) with NHSE, that signed them up to

  • finding ways to control the uptake of services (or “more assertively moderating demand growth”);
  • meeting quality targets;
  • setting up appropriate governance, and
  • accepting significant changes to how finances were controlled.

Each individual organisation within an ACS had to remain accountable for remaining within the ‘financial control total’ set for them by NHSE and NHS Improvement to ensure that that any financial deficit that providers had was reduced to zero.  Agreeing to deliver a control total was a condition of access to the Sustainability and Transformation Fund.

The introduction of financial control totals for all NHS providers in 2016/17 (regardless of whether they were in deficit or not) meant a dramatic extension of central control. These controls govern how an organisation uses its own reserves, and enforce a range of other  conditions from the centre (ie NHSE and NHS Improvement) – for example, they dictate how to manage things like annual leave and short-term sick leave as well as issues of financial management.

But in addition, in order to facilitate the pooling of resources across providers within an ACS, these providers also had to be accountable as a collective for achieving a ‘system control total’ (equal to the sum of the control totals of all organisations within the system). The MOU acknowledged that this new approach to financial control will “inevitably be bumpy in terms of its impact on the financial position of individual organisations”.

Change of name to Integrated Care Systems

New planning guidance from NHSE and NHS Improvement (NHSI) published in February 2018 clarified that they had changed the name of ACSs to ‘Integrated Care System’ (ICS) – apparently as it gave a more accurate description of the work that these systems did.

As some have suggested for ACOs, new systems like ICSs mean considerable changes to the role of Clinical Commissioning Groups (CCGs). CCGs remain responsible for

  • ensuring that ICSs are commissioned in order to provide maximum value;
  • setting the required population-level outcomes; and
  • holding ICSs to account for delivery.

However, providers (NHS or private) within the ICS could take on the delivery of, or contracting for, NHS and local authority funded health and care services.

ICSs – like ACSs – are expected to focus on

  • managing population health (e.g. improving the health of a defined group, rather than focusing on individuals’ health needs),
  • delivering more care through redesigned community and home-based services,
  • taking collective responsibility for financial and operational performance, and
  • ‘more robust’ arrangements between organisations within the system.

Instead of operating as separate bodies, each organisation within an ICS has to sign up to a plan for operating as a single system that incorporates relevant CCGs and providers, and establishes a common approach to matters such as income, expenditure, workforce, and activities. This focus on an overall system (rather than individual organisations within a system) allows NHSE and NHSI greater oversight or control.

For example, spending across ICSs is tightly controlled by NHSE and NHSI. ICSs are expected to produce a plan that will deliver its ‘system control total’ (“the aggregate required income and expenditure position for providers and CCGs within the system” as decided by NHSE and NHSI). Failure to draw up appropriate plans or comply with a system control total will mean loss of access to funding. Notably, organisations within an ICS will be responsible among themselves for resolving any disputes arising from the ‘system control total’.

Integrated Care Providers

NHSE wants ICSs to be delivered by an Integrated Care Provider (ICP), a single lead provider that has been awarded an Integrated Care Provider contract (the contract is currently under consultation as plans to introduce it were challenged by MPs and a judicial review, not least on the grounds that it required new regulations and public consultation).  This contract gives the lead provider the task of both planning and providing services for up to half a million people within a specific area for 10-15 years, These huge contracts that may be worth billions of pounds can be held by a private company.

While private companies have until now sometimes struggled to make enough profit from providing individual NHS services and so had begun to retire from the field, budgets available for whole systems like ICSs will be large enough to attract private investors. By becoming a ‘lead provider’ with a single, long-term contract to set up and manage an entire system, a private company – providing that they stay within the terms of the contract – will be in a position to make decisions, for example, on spending, and on the nature and location of services, and to sub-contract with a range of other providers.

What is the relationship between ICPs and ACOs?

According to the Government’s response to the recommendations of the House of Commons Health and Social Care Inquiry into integrated care,  the ICP was previously known as an ‘Accountable Care Organisation’. 

Arguments against ICPs

A coalition of health campaign groups argues that the introduction of ICPs should be stopped, not least because

  • such a move ignores the real roots of poor integration, namely the market in health services created by the Health and Social Care Act;
  • the IPC contract not only opens the NHS to further privatisation and fragmentation, but if a private company holding a contract crashes (think of Carillion), a wide range of health services would be put at risk;
  • the contract holder may not be a public body, so it would be less accountable to local communities –  an ICP only has  ‘a duty to engage’ local communities, compared to NHS statutory bodies’ ‘duty to consult’;
  • ICPs would reduce transparency – for example, an ICP would not be subject to Freedom of Information requests, and would not have to give the public access to Board meetings or minutes, by citing ‘commercial confidentiality’;
  • the new contract could change general practice, with many GPs being brought in under one ICP. This could mean patients have further to go to see a GP, and find they have less continuity of care.

Instead, campaigners argue:

  • That the Government brings forward legislation to end the failed NHS contracting system and to re-nationalise the NHS: the only sound basis for service integration.
  • That, in this context, there is a guarantee that any organisation tasked with delivering integrated care to patients will be a statutorily protected NHS organisation i.e. an NHS body not open to private providers, underwritten in legislation underpinning these undertakings (see below).The Government commits to sufficient funding and staffing for safe health and social care, and
  • That Social care be brought back into public provision, free at point of use.

For more details, see (see Accountable Care Organisations and Systems section)

House of Commons Library  Briefing Paper No CBP 8190, 6th July 2018. Accountable Care Organisations. 

updated October 2018

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