Implications of ‘integrated’ or accountable care’

 In case you’ve not read our pages on Accountable Care Organisations (ACOs) and Integrated Care Systems (ICSs), these are radical new ways of delivering care that are being introduced at breakneck speed: a number of service providers work together over a set period (e.g. 15 years) to take responsibility for the cost and quality of a specified range of health services for a defined population and for a fixed sum (a ‘whole population budget’).

An ICS is an evolved version of a ST Partnership with responsibility for the health and resources for a defined population. Existing commissioning contracts remain in place. The idea is that commissioners, such as Clinical Commissioning Groups (CCGs), together with a network of providers across different services, enter into an alliance agreement and commit to managing resources together, along with agreeing governance arrangements and the sharing of risk and gain.

In contrast, with ACOs, there is a single contract that establishes an organisation (either an existing or new organisation) that takes responsibility for deciding how to allocate resources and design services. It acts as a lead provider that can set up a series of sub-contracts with other providers.

Some of the issues raised by Integrated or Accountable Care 

In early 2018, as campaign groups raised the alarm about what was happening to the NHS, the term ‘accountable care’ become something of a toxic brand. As a result, what were called ‘accountable care systems’ were re-named as ‘integrated care systems’ (ICSs), presumably in the hope that this would sound far more acceptable. However, in the following, where some of the issues relate both to ICSs and Accountable Care Organisations (ACOs), we  use the term ‘accountable care system’ (i.e all lower case) when the issues raised relate to both ACOs and ICSs. Otherwise, where the issues are specific to just one of the care models, we use  the term ‘ACO’ or ‘ICS’, as relevant.

Accountable care systems are in breach of the NHS Constitution: The introduction of accountable or integrated care has been dominated by NHS England’s drive for ‘efficiency savings’ (otherwise known as cuts). Because organisations within a form of accountable care system collectively agree to provide services to registered patients for a fixed budget (what’s called a whole population budget or WPB) irrespective of the care that is actually provided or needed by patients, there is an inducement to offer as little care as possible to minimise costs. It may mean, for example, that the threshold for offering treatment is raised, or that some treatments are no longer available on the NHS, at least not without special approval from a referral board. This approach contravenes founding principles of the NHS – to provide a comprehensive service, available to all, on the basis of need. (One national group of campaigners has launched judicial review proceedings against NHS England on these grounds.)

Accountable care systems have no legal standing:  Despite the significant changes being made following the 5YFV, the statutory framework of the NHS remains the same: substantial changes to the NHS are now being brought about by administrative decree rather than through a democratic process, such as public consultation, or the introduction of primary legislation that has been duly scrutinised by Parliament.

ST Partnerships have no statutory basis and have no governance rights over statutory bodies such as Clinical Commission Groups (CCGs) and local authorities: ST Partnerships  – and the ICSs and ACOs they are setting up – have no power in law to make decisions without referring these back to partner organisations. However, the Secretary of State for Health intends to deal with this, not by changing primary legislation that would have to pass a series of parliamentary stages, but through secondary legislation, changing regulations without parliamentary scrutiny despite the utter transformation of the NHS that these ‘technical’ amendments would bring. As health researchers points out,

“ACOs will be in charge of allocating resources—effectively deciding which services are provided and to whom; which services are available free, through insurance or out-of-pocket payments; and which services are to be means tested. They can take over patients on GPs’ lists, and they can sub contract all “their” services.

Associated with this, accountable care systems represent a step away from the split between commissioners and providers enshrined in previous legislation such as the Health and Social Care Act (2012).  Normally, new legislation would be brought in to regularise this situation but there is widespread belief that this would publicly flag up what is happening to the NHS and open a can of worms for NHSE.  In other words,

“There are two sorts of change afoot – things which are in the Health and Social Care Act 2012 or other legislation, but which are simply being ignored or changed on the ground; and new ideas which don’t figure anywhere in the Health and Social Care Act 2012 or other NHS legislation, but which are being done anyway.”

NHSE claims that accountable care systems will reduce costs by changing the current system for commissioning services –  bundling them into giant contracts and reducing the costly annual round of purchaser/provider negotiations.  However, without new legislation to remove or amend the Health and Social Care Act, if private providers miss out on a long-term monopoly contract for an ACO, they could seek expensive compensation.  In any event, accountable care systems will still be operating in the context of a costly and wasteful market system.

A group of health campaigners that included Stephen Hawking before his death are currently seeking a judicial review of accountable care systems, this time arguing that the government has failed to lay its proposals before both the public and parliament and so is acting “beneath the statutory radar” in what’s described as a reorganisation by stealth.

Increased privatisation of the NHS:    With ACOs, the boundary between what is done by CCGs and providers will shift: ACOs will be non-NHS bodies that will allow private companies a significant new role in the planning and commissioning of services, as well as their delivery, so escalating NHS privatisation. The single, large-scale contract that characterises ACOs will be immensely attractive to the private sector, especially as it makes it possible for multiple services to be put on the international market, allowing wholesale privatisation at one fell swoop. According to specialists writing for the British Medical Journal,

Behind the ACO it appears that there will be a network of companies—such as large providers, sub contractors, insurance companies, and property companies.

By and large, individual ST Partnerships have no expertise in setting up accountable care systems and so they are spending significant sums of public money on advice from private consultancy firms, like Capita. One can only guess the extent to which these firms shape the new systems with their own interests in mind.

Some fear that accountable care models will in themselves provide a structure that, in future, will facilitate the introduction of private health insurers. Notably, with ACOs in the US, the single contract is held by a public or private insurer.

Asset stripping:    The Naylor Review estimated that delivering NHSE’s 5YFV (e.g. providing premises for new models of care) depends on finding around £10 billion for capital investment in the medium term. The Review suggested that around £2 billion of this could be raised by the sale of NHS assets, notably land and buildings owned by NHS providers in the acute sector. However, it appears that the only way these assets can be made fully accessible to an ST Partnership is if the purchasers and providers involved become a single organisation – an ACO. (With ICSs, the land or buildings owned by NHS providers remain in their ownership). This means that ACOs provide a potential way of ending the social ownership of the NHS and transferring its assets to private ownership.

Lack of accountability and public consultation:    ST Partnerships are introducing accountable care systems with scant public involvement or meaningful consultation, despite the extensive changes in service provision that will inevitably be involved. These new systems are presented as local bodies working in partnership with local communities but in reality, they will be run as businesses with little accountability to local people. This is in breach of the NHS Constitution’s principle that the NHS is accountable to the public, communities and the patients that it serves.

Centralisation of control:      Accountable care systems are being presented as a way for local organisations to get more control over the health system in their area. However, these new systems are being introduced at the same time as increased direct financial intervention on the part of NHSE and NHS Improvement (NHSI), reversing the previous system in which CCGs controlled the funding of services at local level.

Lack of evidence:   There is little robust evidence to support the introduction of accountable care systems to the NHS, partly because pioneer programmes have, by NHSE’s own admission, been of short duration and provided only small sample sizes.

In the US, ACOs are relatively new, and vary in form, ranging from closely integrated systems to the looser alliances that are nearer to ACSs in the UK. There is mixed evidence about their performance. The very different contexts in which the NHS and US health care system operate (not least the different levels of funding), and the lack of a standard model of care also makes it difficult to compare with the US experience.

Unrealistic expectations:    ST Partnerships or their progeny (such as ICSs) are expected to move towards a new form of financial control (a shared control total), in which financial risk is shared across the whole local health system. This means that individual providers within an ICS must set aside their own interests and allow any surpluses they make to be used to offset losses elsewhere within the system. In effect, each provider will police the spending of its partners. As, increasingly, many providers within an ICS will be private companies whose first priority legally is to make profit, they are unlikely to put aside their own interests for the good of the whole, especially as some NHS providers will be in deficit. Alternatively, this system runs the risk that public funding will support private companies operating at a loss.

Workforce issues:   One way in which an ACO is expected to reduce costs is through ‘transforming’ its workforce. ACOs are likely to have lower numbers of doctors and nurses who will be replaced by new technologies to reduce face-to-face consultations, and new roles, such as lower paid, lower skilled physician and nurse associates. Nationally agreed pay levels and NHS terms and conditions of work are expected to be undermined as staff are transferred to employment by ACOs. For example, with the Alzira model of ACO developed in Spain, hospital doctors and many GPs were no longer employed by the public sector, as was usual in Spain’s public hospitals, but by the company running the ACO. Generally, in Spain, employment in the private sector means worse terms and conditions, including less job security, lower pay scales and longer working hours. This allows ‘productivity’ to be increased by around 20 – 30%, compared to the public sector. In Alzira, medical salaries had a fixed component (80%) and a variable element dependent, for example, on how staff responded to the ACO’s incentives. The unified information system for sharing patients’ data not only made patient costs visible to clinicians, it allowed individual clinicians’ work to be monitored and controlled. In Madrid, the regional government abandoned its plan to use the Alzira system for six public hospitals following mass health workers’ strikes and other difficulties.


No one can deny the need for acute, primary care and community NHS services to be better coordinated. However, this is not what ICSs or ACOs will deliver, at least not while they are primarily vehicles for privatisation and unprecedented levels of ‘efficiency savings’ that are widely recognised to be unachievable without savage cuts in services.

Accountable care systems that serve the interests of the private health industry while of questionable value to patients are being introduced outside of any legal framework and without rigorous scrutiny by Parliament. We need new legislation, such as the NHS Reinstatement Bill, that protects the founding principles of the NHS, ends contracting and the marketisation of the NHS and re-establishes public bodies and NHS services that are accountable to Parliament and local communities.

 Further information (see ‘Accountable Care Organisations and Systems’ tab)

updated January 2018

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