Organisation objective

• Statutory item
• Governance
• NHS mandate from government

Working with people and communities

What approaches have been used to ensure people and communities have informed this programme of work?

• consultation / engagement
• quantitative data and insight, for example national surveys
• partnership working with voluntary, community and social enterprise organisation

As part of our work which set out changes to the NHS’s operating model in 2024 NHS England has developed an updated Assessment Framework which will replace the current Oversight Framework, setting out how success and areas for improvement will be identified, and how organisations will be rated. This will apply to trusts who provide services, and to integrated care boards (ICB) who have the responsibility to assess population need and arrange services to meet those needs.  Additionally, NHS England has developed a Strategic Commissioning Framework to support ICBs strengthen their capability to drive the 3 shifts set out by the government. 

This updated framework, to reflect the new government’s mandate to the NHS and the 3 shifts as part of the Health Mission, builds on the one which was developed following engagement with organisations such as the Local Government Association, Healthwatch, Association of Directors of Children’s Services, National Voices, Local Authority Chief Executives and think tanks and was subject to a public consultation in summer 2024. Extensive engagement with the NHS on the updated framework took place between December 2024 and January 2025.

Action required

The Board is asked to:

1. note the updated operating model which was set out in November 2024
2. approve the NHS Performance Assessment Framework for engagement
3. agree to consult on the updated framework allowing testing and engagement during Q1 of 2025/26 with the sector
4. note the intention to issue the final Framework at the end of Q1, with the first formal segmentation of all trusts and ICBs being undertaken and published In July

Background

1. Our approach to assessment is designed to evaluate and improve the performance of ICBs and NHS trusts and foundation trusts (providers) to help ensure that health services are effective, efficient, and patient-centred while supporting continuous improvement.
2. Through our extensive engagement with system leaders and other stakeholders we have heard the current approach to assessment that has been in place since July 2022 is not clear enough to enable targeted improvement, reflects too narrow a range of measures of success and is not consistently implemented across our systems. 
3. In response, we developed an updated oversight and assessment framework that we consulted on in summer 2024. Since this consultation, there have been significant changes which have led to an updated framework:
   1. the change in government and a new mandate for NHS England to support performance improvement in key areas and support the three shifts in healthcare
   2. the changes to our operating model announced in November 2024 that set out the key roles of NHE England, ICBs and NHS providers, emphasising in particular the role of ICSs as strategic commissioners and providers in delivery, and
   3. Secretary of State’s announcement of greater public accountability for performance.
4. This has meant that the framework we consulted on has needed to evolve to adapt to the changing context. In arriving at our changes to the framework we have focused on building an assessment approach which will offer the clarity and consistency that the system has asked for and will support public accountability for improvement. 
5. This paper presents our revised approach to performance assessment following engagement with colleagues across the NHS and the Department of Health and Social Care (DHSC). Key changes to the consultation framework are summarised in the annex.
6. Subject to Board approval, we will issue the NHS Performance and Assessment Framework (NPAF) for consultation and testing, including applying it to trust and ICB plans for 2025/26 during Q1. Feedback will be gathered as part of this testing to inform the finalised framework that will be issued for formal implementation from July.
7. The framework provides the foundation for a number of other important policies and actions. That is why we have agreed with the incoming CEO and Chair the importance of launching it now, as we enter the new financial year, so that NHS colleagues are clear about how their performance is likely to be assessed as they finalise plans for 2025/26 and so it can be appropriately tested and iterated prior to final implementation. In particular, a new strategic commissioning framework has been under development for some time, reflecting the importance of this role for ICBs both now and in the future. It is due to be published shortly, alongside further details of the future operating model, including a transparent approach to publication of comparative performance data and an updated VSM pay framework.

The NHS Performance Assessment Framework

8. Every ICB and provider will be allocated a segment. This indicates its level of delivery from 1 (high performing) to 4 (poorly performing) with an additional segment 5 to indicate the most intensive support requirement. The segment indicates the degree of support and improvement that is required, and guides where formal intervention may be required.

9. The approach is based on assessing performance against a balanced scorecard of metrics across 4 domains which relate to the 4 purposes of an integrated care system. Individual organisations (ICBs and acute, mental health, community and ambulance providers) are measured against metrics that reflect their individual responsibilities, to judge their delivery of NHS priorities. It is important that these metrics are clinically focused, and a Clinical Advisory Group (CAG) led by our Chief Nursing Officer and incoming Co-Medical Director for Primary Care undertook a review of the proposed metrics.

10. They are designed to give a perspective across a wide range of organisational functions from both a tactical and strategic perspective, reflecting the wide range of services provided by the NHS. The list of metrics is intended to be transparent and balanced to reflect both current operating priorities and longer-term strategic ambitions and expectations. The specific metrics housed under each domain will be reviewed on an annual basis and are set out in the annex. The metrics for 2025/26 have been signed off by the CAG and by the DHSC. An underpinning principle of the NPAF is that over time measures should increasingly focus on outcomes and effectiveness alongside access and value for money. The CAG have indicated areas they would wish to see included in the future to support this ambition as and when data flows can be established.

11. Each organisation is assessed on their relative performance on a 1-4 scale, (broadly reflecting quartile of performance), and metrics are combined in each domain and combined to give an overall delivery score for each organisation.

12. Segmentation scores for providers will be based on the organisational delivery score only. For ICBs only a system-adjusted score will be derived using a set of system-level metrics (system considerations) which will assess the overall performance of all NHS organisations against major national priorities. This will give a picture of how the ICB is performing on its own responsibilities together with the overall performance of the system given their role as the leader of the local NHS.

13. The ambition is high performing organisations in segment 1 will receive greater autonomy, such as those proposed in the capital planning guidance. Organisations in segments 3 and 4 will be considered for further support and interventions which may include enforcement activity. Organisations with a segment of 4 will receive a diagnostic review, and this will determine whether they will enter segment 5 and receive support under the Recovery Support Programme for the most challenged organisations.

14. We plan to test operational plan submissions against the framework so organisations can understand their indicative segment (based on the planning guidance priorities only) and consider whether improvements can be made in final submissions. We also plan to publish the data used to calculate segments in an interactive web-based public accountability tool which will be made available from July 2025.

Leadership capability assessment

15. As part of the assessment process, we will also assess leadership capability in ICBs and providers. Insights gathered from these assessments will be used alongside segmentation scores to direct our performance improvement activities to the organisations who have poor performance and lack the capability to improve without support or intervention.

16. ICB capability assessments will review 6 functional areas which measure whether they are delivering their contribution to the ICS purposes and assure NHSE that they are discharging their statutory duties and powers. Providers will be measured against the six domains of the insightful provider board using a combination of self-assessment, third party information and measures of their track record.  

17. Guidance on the capability assessment is under development and will be published in due course as part of our wider package of support related to the NHS Performance Assessment Framework.

Consultation and testing

Responses to the consultation were broadly positive about the holistic approach which considered delivery and capability. We do note that the new assessment approach departs from the consulted-on framework, given the changes outlined in annex A. To keep the sector informed throughout December 2024 and January 2025, we undertook seven regional roadshows to test the update to the Operating Model, the Assurance and Strategic Commissioning Frameworks with ICBs and NHS Providers, and where possible we have responded to the feedback that we heard in those roadshows.

18. We consider that the changes we have made are in response to the feedback we have received and engagement through the regional roadshows (that is, making it less complex and transparent). However given the changes since consultation last summer, we plan to publish the NPAF for a further period of testing and consultation. This will allow further engagement with ICBs and providers with regional teams during quarter 1, as well as continuing engagement with NHS Providers and NHS Confederation.    

19. We will therefore commence testing and engagement in April and following the local elections we will conduct a short public consultation commencing 2 May to 23 May 2025. This is consistent with the consultation approach in 2024.

20. Feedback will be gathered as part of this testing and consultation to inform the finalised Framework for approval at the end of Q1. The first segments will be published after this period.

Alignment with emerging policy

21. While we are keen to give the NHS clarity as it enters 2025/26, it is also important to recognise that there may be further changes to ensure the assessment of the NHS reflects the 10-Year Health Plan and other recent reviews relating to quality and oversight when they are published.

22. To underpin this, we recommend that the Clinical Advisory Group is formalised on an ongoing basis to review any additional metrics with support from our business intelligence teams to ensure feasibility in collecting the data, ensuring sufficient data quality and that it can be assessed in an accurate and useable manner to drive change.

Resourcing

23. Implementation of the new Framework may increase the demand for improvement capacity and to ensure this is deployed appropriately, consideration will need to be given to the most appropriate governance model that will help manage and prioritise the use of this resource. For the RSP specifically, this may be managed by undertaking the diagnostics in a phased approach and by applying a more focused and prioritised approach to allocation of the support package to RSP organisations in 2025/26.

Recommendation

The board is asked to: 

1. note the updated operating model which was set out in November 2024
2. approve the NHS Performance Assessment Framework for engagement
3. agree to consult on the updated framework allowing testing and engagement during Q1 of 2025/26 with the sector
4. note the intention to issue the final Framework at the end of Q1, with the first formal segmentation of all trusts and ICBs being undertaken and published in July.

Annex A: key changes that have been made since consultation

1. Segmentation decisions will be based only on the delivery metrics and will not be adjusted for organisational capability. This is so there is full transparency for the public about how their local NHS is performing.
2. Providers scores will not be adjusted for system considerations, i.e. their delivery scores cannot be moderated for system performance, instead the extent to which they are collaborating will be included in a separate capability rating which will be used to inform our regulatory response
3. Overrides have been included for finance which means organisations in deficit/or that score a 4 in finance domain have their overall segment score limited to 3
4. The introduction of segment 5 which is effectively the category for the organisations needing the most intensive support informed by a diagnostic review
5. We have removed the detail of our approach to organisational capability both ICB and Providers as we wish to complete and test our work on this as we finalise our improvement approach. This will be done in Q1.

Annex B

2025/26 operating priorities 

These metrics relate to key national operating objectives defined in the NHS Planning Guidance for 2025/26 

Finance and productivity metrics

These metrics relate to measures that will be used to judge organisational financial delivery

Table 5: Public health and patient outcome metrics

These metrics relate to longer term priorities such as patient outcomes, prevention and inequality as well as cultural and experience measures.

Quality and inequalities metrics

These metrics help to judge how effectively organisations are delivering high quality, safe care with positive patient experiences as well as acting to reduce inequalities of access, outcome and experience

System considerations

These metrics relate to priority tests applied at a whole system level which affect all organisations in the system 

 Publication reference: Public Board paper (BM/25/10(Pu)