No sooner do you learn the acronym, than NHS England announces that Accountable Care Organisations (ACOs) will now become Integrated Care Systems (ICS). The arms-length body has argued that this move is to better reflect the nature of the organisations; however the fact that the term ACO had quickly become toxic is no doubt not a coincidence. 

So why the change of heart and what happens next? Thankfully Four Public Affairs is here to bring you up to speed…


1. What were ACOs?

ACOs were first referenced by NHS England in the flagship Five Year Forward View (FYFV) – although at that point they weren’t being proposed outright. Instead they were mentioned in relation to their similarity to the Primary and Acute Care Systems, which were the original vision for allowing general practice and hospital services to integrate for the first time and move away from the current hospital-based model of health care delivery

In essence, ACOs aim to remove the traditional divide between primary care, community services, and hospitals – largely unaltered since the birth of the NHS – which is seen increasingly as a barrier to a personalised and coordinated health service. They formed an evolution to the existing Sustainability and Transformation Partnerships (STPs) – which were themselves met with controversy – to allow areas to more fully integrate their services and formally bring together those organisations that are already working side-by-side to deliver health services. Crucially, this also came with responsibility and complete control of local funding arrangements, making these potentially powerful organisations.


2. Why were they so controversial? 

Anything perceived to open up the NHS to greater private sector involvement is met with great scepticism. Under current public procurement law, private sector organisations are eligible to bid for public sector contracts, so any proposals which involve the contracting of NHS services could, in theory, allow for greater private sector involvement.

However, the term ‘in theory’ is important here. There is little appetite amongst private providers to deliver services at the scale required to cover an entire ACO. What’s more few, if any, have the capacity. While campaigners are correct in stating that private sector involvement in the NHS is on the rise, it still accounts for just 7.7 per cent of NHS Commissioner spend according to the DHSC’s latest figures.  In addition, ACOs would not be a new type of legal entity so would not affect the current commissioning structure of the NHS.

It is clear that NHS leaders themselves have been frustrated by the narrative of ‘secret plans for privatisation’ which they argue has not been helpful and have called for more to be done to communicate the proposals with the local health population.


3. What has been NHS England’s response?

The first draft of the ACO contract was published by NHS England last year, however its implementation has now been paused pending the outcome of a further consultation to be held by the national commissioning body and two judicial reviews which have been launched by campaigners over the contract.  It is said that NHS England will use this as an opportunity to provide further clarity on the role and responsibilities of ICSs, and will cover both the terms of the contract and why it is being proposed.

The consultation is due to close mid-April, so we should expect an announcement from NHS England shortly after that. 


4. Will the proposals go ahead?

In a nutshell, yes.

NHS leaders have broadly spoken out in support of the plans and the need for greater integration between services, to allow them to work together to meet the needs of the local population. Integration is already being implemented, but without an NHS contract the scale and pace of change is currently being hampered by the lack of a clear framework to bring local NHS providers together. In addition, concerns have been raised around the lack of clear governance arrangements on where accountability should be held, so a formal contract is clearly needed to address this. As long as there is an appetite  for this type of approach within the NHS (and we know that there is), we should expect to see more, not fewer, mechanisms to encourage this.

However, NHS England has itself acknowledged that ICSs will be only one tool for integrating primary care, social care and hospital services. It will be up to local health commissioners and providers to decide whether to take advantage of a contract once it becomes available.


5. What happens next?

The Health Secretary, Jeremy Hunt, has already said that a small number of ICSs may sign a contract later in 2018, acting as a prototype for the rest of the NHS. The most developed proposals – in Dudley, in the West Midlands – will be awarded a contract later this year, while the timing of a proposed ICS-type model in the City of Manchester is currently unclear. Once a contract is formalised however, we could see more organisations coming together to deliver services under this model.