News / Monitor addresses dual tariff queries as majority of trusts choose enhanced tariff

Monitor and NHS England have moved to address some of the issues arising from the fact that two tariff options will be operating in 2015/16.

Providers were given until 4 March to decide between the enhanced tariff option (ETO), which Monitor said could be worth £500m to the sector as a whole, and the default tariff rollover (DTR) – essentially
the 2014/15 tariff with a few key changes. Almost nine in 10 NHS providers (88%) opted for the ETO – 211 of the 241 NHS trusts and foundation trusts.

The ETO includes a number of enhancements to the original tariff proposal. They include a 70% marginal rate for emergency and specialised services, while the headline efficiency rate will be 0.3% lower than initially proposed.

In a Commons written answer, health minister Jane Ellison said four NHS trusts wrote to the regulator reserving their right to legal challenge – one had chosen the ETO option but placed conditions on this. The key issue is CQUIN quality payments.

The 30 trusts that chose the DTR will not be eligible for CQUIN, a fact reinforced by Monitor in a Q&A document on the operation of the tariff options. It added that this position would not change, even if Monitor refers the 2015/16 tariff to the Competition and Markets Authority.

Although any final tariff that emerged from the CMA process would have implications for 2015/16 prices in the DTR, it ‘would not affect the withdrawal of CQUIN for providers for 2015/16 who have not opted for the ETO’.

The document also clarified that DTR providers not eligible for CQUIN would not be expected to meet the minimum national requirements for the scheme. However, commissioners could ‘seek to negotiate’ specific quality standards in contracts.

High-cost drugs are another potential issue for providers that chose DTR. The Q&A confirmed the 2014/15 list of excluded drugs and devices will not be updated under the DTR option.

NHS Confederation chief executive Rob Webster welcomed the fact that local health economies now had a degree of certainty about prices for 2015/16. Providers and commissioners could get on with collaborating to plan service delivery. ‘The enhanced tariff option has not been agreed by everyone,’ said Mr Webster.

‘Urgent work is needed to resolve the delay in agreeing prices for 2015/16 with those providers on the DTR. Hopefully, these developments can accelerate this process. We will need to take time to review the process for agreeing the 2015/16 national tariff and see what lessons should be learnt for agreeing prices next time.’