Technical review - February 2018

Announcing the joint work in a blog, David Morris, a PwC partner, said the research would examine how money should flow through health and care systems and how to incentivise behaviours to deliver the outcomes users need. The study is due to be published in the spring.

The HFMA has backed proposals for reporting the new use of resources assessment for providers. In a consultation document last November, the Care Quality Commission and NHS Improvement proposed publishing the new use of resources rating alongside an overall quality rating, with the quality rating based on the CQC’s existing five key quality areas (safe, effective, caring, responsive and well-led).The consultation also proposed combining the resources assessment with this quality rating to produce an overall rating. Three examples of how this might look were put forward. The HFMA said the dual approach made the ‘finding and impact on overall rating clear’. However, it raised concerns that the use of resources rating and existing quality rating for well-led may overlap and could lead to double counting of an issue. The HFMA Provider Finance Faculty is running a forum on use of resources in March – contact [email protected].

 

The 2018/19 Treasury Financial reporting manual (FReM) was published at the end of December and the Department of Health and Social Care followed this up with 2018/19’s draft Group accounting manual a month later. The key proposed changes are:

 

• Adoption of IFRS 9 Financial instruments
• Adoption of IFRS 15 Revenue from contracts with customers
• Adoption of the amendment to IAS 7 Statement of cash flows
• Amendment to the guidance on discount rates as a result of the Treasury’s move to nominal rates
• An additional requirement to disclose medical locum staff costing more than £142,500 per annum
• Amendment to the disclosure of ‘NHS’ and ‘non-NHS’ receivables and payables
• Clarification of PDC dividend calculation

In addition, there is a consultation question around the use of the external financing limit (EFL) as a performance measure. Consultation ends on 23 February – and the HFMA will be submitting a response – please email comments to [email protected].

A recently published briefing from the HFMA describes a new national centralised system for purchasing expensive medical devices and implants used in specialised services. Roll-out of the system, a response to recommendations in the Carter review of productivity, began in 2016/17. As well as describing how the system works, the briefing also considers the accounting implications of one NHS body procuring stock that is held and used by another body. And it also identifies lessons that could be applied to other centralised procurement arrangements.