About new business models

The Next Steps on the Five Year Forward View (published March 2017) describes a move towards integrated care, delivered through collaboration across health and care systems. Building on sustainability and transformation partnerships (STPs), some areas are now ready to go further and more fully integrate their services and funding.

An integrated care system (ICS) is an evolved version of an STP, potentially covering a smaller part of an STP area and is where NHS commissioners and providers in partnership with local authorities take collective responsibility for improving the health and wellbeing of the population they cover. Some areas also want to establish accountable care organisations (ACOs) where the commissioners in that area have a contract with a single organisation for the great majority of health and care services and for population health.

ACOs and ICSs have the same aim of integrating care and having a single approach to using resources to improve quality and health outcomes for local people.

Procurement processes to establish ACOs are lengthy and complex and for these reasons, most parts of the country are looking to become ICSs before they consider whether to introduce ACOs for some or all of their local population.

A few areas – particularly some of the multispecialty community provider (MCP) and integrated primary and acute care system (PACS) vanguards – are, subject to a forthcoming consultation exercise, on the road to establishing an ACO. The proposed ACO model simplifies governance and decision making, brings together funding and allows a single provider organisation to, within the parameters of the contract and subject to the statutory non-delegable functions of the commissioner, use and allocate its resources in such a manner as it determines will best service the needs of its local population. This creates a more structural solution to accountability for the care and resources for that population. Some ACOs could develop within ICSs, and on a smaller footprint, as part of a wider, collaborative system.

In the small number of areas that are ready to establish ACOs, the New Business Models team will support their development and early ACOs will provide valuable learning for others.