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Sharp rise in block contracts threatens legal right to choose

A dramatic 32% rise in the value of block contracts commissioned by CCGs for NHS-funded elective care procedures in just one year threatens government policy that patients should be able to choose their provider for an operation, the NHS Partners Network (NHSPN) has warned.

The data, collected through Freedom of Information requests from CCGs across the country, showed that CCGs are now commissioning nearly £2.8bn in block contracts. This means their value has ballooned by over £700m between 2013-14 and 2015-16.

The total number of block contracts held each year in the 91 CCGs which held some form of block contract for planned elective care also grew by 50% since 2013-14, particularly in the capital and the south of England.

Across the private healthcare field, however, the value of block contracts has dropped by almost 10% in the same period.

Block contracts – where CCGs give providers, usually trusts and foundation trusts, a set amount of money in advance to deliver a pre-agreed amount of operations – are usually related to financial pressures. The guaranteed cash in the block contract helps trusts manage their finances.

But the NHSPN, which represents private sector providers of NHS services, warned that the steep rise in them risks undermining patients’ legal right to choose providers by incentivising referrals to the provider with the block contract instead.

This could also aggravate already-stretched waiting lists as patients are referred into the default provider and, in some cases, it could even mean operations are paid for but never performed.

David Hare, chief executive of the Network, said the rise in block contracts in just 12 months is “a clear indication of how much pressure CCGs are under to support the balance sheets” of NHS providers.

“Whilst block contracts may be tempting for commissioners to agree when public providers are struggling financially they are not better for patients who should be allowed to choose their provider with the money following their decision. The commissioning process needs to reflect the importance of driving up standards in the health service and ultimately improving outcomes for patients,” Hare said.

“We would encourage NHS England and CCGs to reflect on these figures and ensure that decisions around block contracts are carefully balanced between the need to improve patient care and balance the books.”

Last year, NHE also revealed that mental health trusts that use block contracts have nearly a third more days of delayed discharge per month than trusts providing services without a block contract.

But NHS Clinical Commissioners argued today that block contracts do not in fact limit or threaten patient choice. Its chief executive, Julie Wood, told PSE in a statement: “It is not a surprise CCGs are managing their contracts for NHS-funded elective care procedures in this way. The contracts will have thresholds that mean they can flex the level of resource that will go to pay for care to reflect patient flows. 

“Using this form of contracting does not restrict patient choice. If patients want to exercise their right to choice they absolutely can as their constitutional rights are still the same.”