The state of integrated care systems 2022/23: riding the storm

Introduction

Integrated care systems were born into a challenging context. Since their formal establishment in July 2022, including the creation of ICBs as statutory bodies, they have weathered political and economic uncertainty, rising inflation and a cost-of-living crisis. The health and care system faced one of its toughest winters yet, with immense pressure on emergency services, an uphill battle to tackle the elective care backlog and the huge financial and workforce challenges facing the NHS and social care.  

The State of Integrated Care Systems is the ICS Network’s flagship annual report series, reflecting the views of ICS leaders on the development and impact of ICSs.

Through this report, we aim to provide insights into the successes and challenges of ICSs one year after their formal establishment. Building on the Hewitt review and through engagement with our members, we have identified key recommendations that we believe will give ICSs the conditions they need to deliver for the local population that they serve. See Annex 2 for a summary of the recommendations ICS leaders see as the highest priority.

The research is primarily based on a national survey of ICS leaders (ICB chairs and CEOs and ICP chairs), which was followed up with a number of interviews. We also held roundtables and interviews with wider system partners to provide additional context and insight and, worked with Carnall Farrar to add some quantitative performance insights.  We intend to use this report to shape our influencing strategy over the coming year and will continue to work with partners to implement the recommendations and to build on our approach for future reports. We would like to extend thanks on behalf of the ICS Network to everyone who participated, for their incredibly helpful insights and contributions.

Progress to date

In their first year as formal partnerships, ICSs have delivered impact in a challenging operating context. Progress looks different across different systems, places and neighbourhoods depending on local dynamics, geographies, levels of maturity and the specific needs of local populations.

Building relationships

Nearly nine in ten leaders responding to our survey feel that partners within their ICSs (including NHS trusts, primary care, VCSE, local government social care providers) are working collaboratively to both set and deliver on priorities. 

These findings are consistent with last year’s survey, suggesting that relationship building continues to be a key area of focus for ICSs. One ICB CEO described their relationships as ‘very collegiate’ with a ‘strong system identity, supported by developing place and neighbourhood structures’. Responses also reinforce the time commitment that this requires, with one ICB chair describing the ‘major time and energy’ taken to ‘get to a good place’.

Relationships have developed differently due to local dynamics and arrangements, history and maturity. As one ICB CEO remarked: “We have a very strong set of relationships at all levels, forged over the last seven years as an STP/ICS. This takes constant attention.” A community trust leader similarly described the productive approach to problem solving in their more mature system, where problems are seen not as a barrier but an opportunity to work together. NHS Providers’ regulation report found that NHS trust leaders were overwhelmingly positive about ICBs’ role in fostering a sense of shared responsibility and collective endeavour among system partners, bringing them together to solve problems and share practice on patient care and outcomes.

An area where ICSs are particularly positive about progress was the relationship between the ICB and ICP. Over nine in ten ICS leaders report that the ICB and ICP are working positively together. Building on the recent publication of integrated care strategies, ICPs now have the opportunity to further develop their role, bringing together the breadth of system partners including places and health and wellbeing boards to address the wider determinants of health. Different ICSs, however, have different plans for where to take the ICP in the context of their own local dynamics and place-based arrangements.

One joint ICB/ICP chair shared their ICS development plans, including making the ICP the more important body:

“While the ICB should take care of the system and money, the ICP should be busy driving key objectives at place, in provider collaboratives and maintaining a future focus.”

In order to support these discussions, the NHS Confederation’s ICS Network will be developing a report with the Local Government Association (LGA), setting out the different approaches being taken to the role and resourcing of the ICP by different systems.

Delivering impact in the short and longer term

We asked ICS leaders where they feel they have delivered impact in the last year. Some of the examples provided included cross-system strategic planning; coordinating the operational response to winter pressures including urgent and emergency care, discharge and elective recovery; developing and strengthening place-based arrangements and cross-system collaboratives; supporting and commissioning primary care; financial sustainability and improving productivity; enhancing engagement and co-production capabilities and developing long-term joint strategic plans.

However, several respondents noted that some material benefits are difficult to quantify just nine months after ICSs’ establishment as formal partnerships. ICS leaders also highlighted the issues created by a short-termist approach within government that prioritises short-term operational imperatives over long-term transformation – something which ICS leaders worry could increase in the run up to an election.

Broadly, ICS leaders are positive about their system’s ability to fulfil their four statutory purposes. There is less confidence at this stage in relation to the role of the NHS in social and economic development, perhaps a less traditional NHS priority and the area most reliant on mature partnership working, where the ICP will have a significant role to play. The NHS Confederation is working with NAVCA, National Voices, and the LGA to capture and share learning about how the NHS can support social and economic development through its ICS partnerships.

Further analysis conducted in partnership with Carnall Farrar shows that there is an association between survey respondents’ confidence in improving population health and healthcare outcomes and those systems’ higher performance in several population health and healthcare outcomes, suggesting that ICS leaders’ self-perception was justified. Further detail on this analysis is provided in Annex 1.

Areas for future improvement

ICS leaders are keen to build on progress and highlight two areas where they aim to focus their attention during the next period of development.

Devolved decision-making

ICS leaders remain committed to devolution to place-based partnerships and provider collaboratives as they mature. For ICBs this will mean further delegation of responsibilities and decision-making powers. As one ICB CEO commented:

“We have significant ambition and plans to delegate to areas such as place, provider collaboratives and PCNs.”

This principle of subsidiarity is a core element of ICS development and is mirrored by work at a national and regional level to support greater devolution, for example through the Greater Manchester devolution deal. The NHS Confederation and LGA’s jointly-hosted Health and Devolution Working Group is supporting ICS and local government leaders to look at how the government can support health in devolution, informing practice and creating a space for an ongoing conversation.

However, despite this commitment and intention to devolve decision-making within ICSs, only 45 per cent of survey respondents felt that their ICS currently devolves decisions to the most local level, as close to local communities as possible. Some system partners we spoke to also reported slowed progress in devolved decision-making and a lag between technical delegation and true subsidiarity.

For many systems, the past year has been about establishing system governance and the core building blocks which can in turn enable smooth and effective delegation and devolved decision-making. ICBs understandably need assurance that place-based partnerships, provider collaboratives and other bodies have the requisite resourcing and maturity to take on additional functions. ICBs will want to learn from and build on positive examples of devolved decision-making.

Further analysis of our survey findings revealed an association between ICS leaders’ confidence in place-based partnerships. This was measured using an unweighted average of two questions on place-based partnerships, and performance of their ICS on population health management based on metrics from the ICE tool (see further details in Annex 1).

Harnessing the skills and contributions of system partners

ICS leaders are exploring opportunities to further harness the unique skills and contributions of system partners. Overall, ICSs are positive about the commitment and contribution of system partners to the ICS, in particular in relation to the VCSE sector. ICS leaders also recognise the important role that primary care has to play and acknowledge the capacity constraints that exist and potential role of ICSs in providing further support.

The findings are less positive in relation to the independent sector. When we discussed this further with an ICB CEO, they felt that engagement with the independent sector is variable and focused on supporting elective recovery and financial balance. They called for ‘a clearer ask so we can have a better conversation with the sector.’

While the picture on collaborative working is generally positive, ICS leaders recognise that different systems have different starting points when it comes to system-wide relationships. Dynamics such as levels of co-terminosity can also impact on joint working. One ICB CEO commented that for them it has been easier to build constructive relationships around tackling health inequalities than social care integration. One ICB chair highlighted some of the challenges they have had in shifting from an organising principle of competition to one of collaboration:

“Whilst progress is being made, there are still instances of individuals reverting to previous approaches and behaviours and prioritising organisations over the system - probably best described as some individuals looking to build a castle while the rest of us are looking to build a village.”

These challenges of collaboration are also highlighted by system partners. Some local government and primary care leaders reported that while they feel able to engage within the ICS, this does not always feel like genuine collaboration, and both groups felt that acute providers still hold the strongest voice in the system. This mirrors the findings of the County Councils Network survey that there are significant challenges to overcome before councils can consider ICSs a truly partnership arrangement. This is perhaps unsurprising given that statutory ICSs and the ‘triple aim’ are only a year old. As the Hewitt review argued, sustained cultural change is required at all levels, including within providers, ICPs and ICBs.

ICS leaders acknowledge that there is further work to do to ensure that both the ICB and ICP are able to fully involve system partners and benefit from their expertise. This was recognised also by social care and VCSE partners who noted some opportunities to maximise their contribution to ICSs, for example working with systems to better support specific patient groups.

Despite the strong support demonstrated through our survey, there is clear recognition of the resourcing and maturity challenges that exist in various parts of the sector, particularly within primary care where 50 per cent of ICS leaders did not think primary care networks (PCNs) have the requisite level of resourcing and maturity to deliver the ambitions outlined in their integrated care strategy. These findings were supported by the primary care leaders we spoke to, who referenced the unrealistic expectations that can exist. Similarly, one ICB CEO’s view was that there has been an over-expectation of what PCNs can deliver within their existing infrastructure and leadership capabilities, rather than being a vehicle for transforming primary care.  

Both ICS and primary care leaders are clear that PCNs will need the autonomy and support infrastructure to allow primary care leaders to play a more active role in ICSs. PCNs are formed of multiple organisations coalescing around common goals with varying degrees of infrastructure for doing so. There is clear commitment to primary care at scale and a recognition of the important role that primary care can have at different levels. PCNs will be a key partner in improving population health and building neighbourhood resilience, including driving integration at neighbourhood or district level (as set out in Claire Fuller’s stocktake).

Barriers to progress

Barriers to integrated working

ICS leaders identified a number of barriers that are impeding their progress and which require action from government and national bodies. The top three identified in our survey are consistent with last year’s findings: pressure on and morale of the workforce, the lack of funding for social care, and the current financial position of the NHS. We discuss national politics as a barrier to integration in section 6.

Workforce

ICS leaders are thinking ambitiously about how to support the workforce, taking a whole-system approach and considering the interplay between health and social care. However, the workforce challenges faced by ICSs are severe. As of December 2022, vacancies in the NHS reached 124,000, which represents 8.9 per cent of planned FTE workforce levels, and vacancies in social care have risen to 165,000. The UK has on average fewer doctors and nurses per person compared to peer countries. ICS leaders have welcomed NHSE’s recently published NHS Long Term Workforce Plan, which is a welcome step to tackle persistent workforce shortages in the healthcare sector, although leaders have also highlighted their concern that there remains a lack of a comparable plan for social care. The plan sets an ambitious 2.2 per cent productivity target, but there is a risk that this could set systems up to fail against their financial targets in future years.

Social care

ICS leaders are concerned about the impact of longstanding underinvestment in the social care sector, despite recent extra funding in the 2022 Autumn Statement. Staff vacancies in the sector have risen to 165,000 and low wages associated with lack of opportunities for progression make it difficult for social care to compete with other sectors for staff, as noted by one ICP chair:

“Money goes to the NHS for a pay rise, it doesn’t include people doing very similar jobs in social care. So all that’s happened is people are being sucked out of social care and into the NHS because they’re being better paid there. Even though they’re in one system.”

The recently announced £600 million to support the social care workforce over the next two years will help bridge some of those gaps in the social care workforce, but there is still a desperate need for a long-term social care workforce plan.

Local government leaders also highlighted how pressure over the winter, including difficulties in discharging hospital patients due in part to a lack of capacity in social care, have created tensions between NHS and local government partners.

NHS financial position

Some ICS leaders described how financial constraints have tested relationships within their systems, particularly in the context of competing priorities. One ICB CEO stated that their ‘financial position is putting a lot of strain on partnerships with local authorities’. Financial challenges exist in both the NHS and local government. Another ICB CEO reflected that ‘all-consuming’ financial issues in one of their local authorities had created a ‘retrenching back to people’s organisations’.

The discrepancy between how funding is allocated and distributed between NHS and local authority partners can act as a barrier to a truly integrated way of working. Local government leaders indicated that one-year settlements and the pressure of balancing the books at the end of the financial year can make it challenging to work collaboratively on long-term aims. One local government leader described the challenge of annual settlements creating ‘feast and famine collaboration’. Our research supports the Hewitt review’s recommendation for multi-year funding settlements, which would give partners more bandwidth to plan together in the medium-to-longer term.

Capital spending remains a particular concern of ICS leaders, and will be essential if the sector’s productivity targets are expected to be met. Capital spend has declined in real terms throughout the 2010s and lags behind other OECD countries. Increased investment in this area, such as upgrading estates and IT equipment, can enable better productivity, but ICS leaders highlight the impact that uncertainty and delays on the allocation of capital funding can have on the system’s capabilities to deliver high-quality care.

One ICB CEO described the consequences of constantly moving the goal posts on capital funding:

“There needs to be a different way for capital to be identified and then secured, because otherwise it’s just a waste of everybody’s time. We raise people’s expectations and then have to manage the political fallout.”

Our research further supports Patricia Hewitt’s recommendation of a cross-government review of the entire NHS capital regime.

Many members have faced challenges associated with complex capital allocation processes. For example, Bedfordshire, Luton and Milton Keynes ICS met difficulties when bidding for community diagnostic centres to support capacity in ophthalmology. Although CDC guidance supported ophthalmology as an appropriate pathway for inclusion, the system was later advised that ophthalmology was no longer being supported with capital or revenue funds, after spending significant time building a case with system partners. This significantly delayed the programme and created tensions between national guidance and the ICS priority to address health inequalities. Ophthalmology was eventually supported following significant intervention from CEOs and remodelling of the plans.

Capacity to deliver service transformation

As ICBs take on new commissioning functions for primary pharmacy, optometry and dentistry services and are also now responsible for implementing large elements of the NHS Long Term Workforce Plan, there is a danger they are being asked to take on too much while simultaneously reducing their running costs.

In March 2023, NHSE announced that ICBs should plan for a 30 per cent nominal terms reduction of their running costs by 2025/26, with no inflationary uplift, which could be closer to a 40 per cent reduction in real terms. Three out of four ICB leaders are concerned that this reduction in their running cost allowance (RCA) will impede their system’s ability to deliver the ambitions of their strategy.

One ICB CEO cited running cost allowances as the top barrier to integrated working over the next two years, which they felt is ‘getting in the way of the work.’ Another described feeling that they are facing ‘war on multiple fronts’, from inheriting massive legacy issues, to a national NHS budget crisis, a challenging winter and now ‘making major cuts in the ICB workforce’ (after they had been told no jobs would go).

New commissioning functions

ICBs have recently taken on new functions, including the commissioning of primary pharmacy, optometry and dentistry (POD) services. Most leaders surveyed felt very or moderately well prepared to take on each of these additional functions: nine out ten ICB leaders felt prepared for pharmacy and optometry services and seven out of ten for dentistry. 

However, these new functions will require specialist capacity, which risk being depleted by the RCA reductions. ICS leaders highlighted concerns regarding this transition, including the lack of appropriate and high-quality data for many of the services, a lack of visibility on the risk they are taking on and significant challenges in dentistry linked to the national dental contract. One ICB chair wanted to take on POD functions but felt they were ‘being rushed through as our budgets are reducing, which will limit our ability to change services for the better.’

Another described the challenges posed by cuts to their management costs to taking on new services which have legacy issues:

“We are inheriting services with significant operational and financial challenges, especially dentistry. The transferring infrastructure - particularly workforce - is small and will be included in the RCA process and so will likely be further diminished.” These findings reflect the experience of early adopter systems. 

Supporting ICSs to realise their full potential

Balance of local/national and short/longer term priorities

The word cloud below represents the ambition that ICS leaders have for their system over the next five years.

The words ‘health inequalities’, ‘prevention’, ‘population’ and ‘communities’ were the most   referred to areas where people wanted to make progress. Common examples included having effective integrated neighbourhood working, increasing the share of resources allocated to prevention, achieving a shift in healthy life expectancy inequalities, and improved services for children and young people. This shows that ICS leaders are united by a common ambition to shift towards prevention, drive improvements in population health and reduce health inequalities. This demonstrates a significant change in mindset among healthcare leaders away from a more medicalised NHS focus.

ICS leaders recognise the importance of addressing both immediate operational pressures such as improving access and reducing waiting times, and longer-term priorities such as achieving the three big shifts towards preventing ill health, personalised care and participation, and from a predominant model of hospital care to care closer to home. However, a key theme across our research was a feeling that these more transformational priorities are often crowded out by a focus nationally on what one ICB CEO termed ‘a small number of NHS driven, short-term political priorities - money, waiting lists, ambulances etc.’ One joint ICB/ICP chair described how the focus on urgent ‘here and now’ issues across yearly financial settlements limits progress on the prevention agenda:

“What you can’t do is just hope it works – the urgent trumps the important.”

One ICB CEO was concerned that this mismatch could damage local relationships: “Other partners on the board might start to say ‘I’m not in this to talk constantly about ambulance handover times.’” This sentiment was echoed by the system partners we spoke to. Primary care and place leaders spoke in depth about how tensions between local and national priorities limited their ability to focus on prevention work. The County Council Network’s report on the role of county authorities in ICSs similarly found that a focus on NHS priorities such as discharge and a command-and-control culture, was impeding collaboration.

In a taxpayer-funded system in which politicians are accountable for service performance and delivery, ministers will naturally expect to set national priorities for ICSs. But as some recent examples indicate, there is a risk that NHS priorities become more focused on short-term political imperatives in the run up to a general election. Our survey demonstrates concern among ICS leaders that national politics could become a barrier to integrated working over the next two years (See chart 6). A joint ICB/ICP chair described the pull between local and national priorities as feeling like an elastic band: “One minute we are independent and the next thing we ping back." However, they recognised the role played by NHSE in acting as a political buffer for the system: “NHSE does well under extraordinary pressure from politicians in a way the NHS never has been before.”

ICSs and the role of the centre

Support for ICS development

ICB leaders are generally positive about the support they receive from their NHSE regional team, with almost 60 per cent agreeing regional colleagues’ support has been effective for the development and progression of their ICS. One joint ICB/ICP chair said they felt lucky to have their regional director, who fosters good working relationships with all ICSs in the region and provides ‘a very good filter from the top’.

When it comes to support they receive from NHSE’s national team, and on national guidance and policy on system working, ICB leaders want to see more co-production to ensure that national support and guidance is aligned with ICS development needs and believe the ICS Network can play a valuable role in facilitating this. The shift to ICSs will demand a different approach and ways of working, with a greater focus on sector-led improvement (for example through peer review) and ICS leaders more directly involved in the development of healthcare policy, which was highlighted by the Hewitt review. The approach taken by NHSE to developing the most recent operational planning guidance, supported by Patricia Hewitt and others, marked a new approach to co-development which resulted in a document with fewer priorities overall and greater scope for longer-term priorities.

Accountability arrangements

ICS leaders acknowledged the pressure NHSE is under in recovering the health and care system, managing operational demand and managing its own internal transformation programme. ICS leaders are supportive of the intentions set out through NHSE’s new operating framework and there has been positive feedback on more recent changes, such as the approach to this year’s planning guidance. However, the pace at which NHSE is embedding the new framework was highlighted as a challenge by ICS leaders in our research.

Many of the ICB leaders we spoke to recognised the issue of repeat and sometimes conflicting data requests and there was strong support for Patricia Hewitt’s recommendations aimed at rationalising the number of central requests. A joint ICB/ICP chair reflected: “I think NHSE is trying hard to be more supportive and collaborative. However, there are still too many last-minute requests for data and too much unnecessary bureaucracy.”

There was recognition through our research that the system will continue to evolve. One ICB CEO described a future in which further devolution to ICSs could in the long-term call into question the role of NHSE’s regional teams:

“If in my ICS I can create a truly integrated care model that on the day-to-day basis is run by our providers through collaboratives and places, this will allow the ICB to take on the significantly needed strategic commissioning and oversight duties and I think there’s a really legitimate question about why you need ICBs as well as NHSE regionally. But we’re about two or three years away from that conversation because we need to develop our places.”

There will, however, be differences of approach based on local context. For example, the regional office may have a greater role in regions such as the south west and the midlands where there are many small ICSs.

ICS leaders also described work they had delivered  in partnership with their NHSE regional teams to clarify accountabilities locally. One ICB CEO felt that having the regional NHSE locality performance lead embedded within the ICB was helpful, although they felt it was still quite a ‘crowded pitch’ that can lead to ‘trusts feeling pulled in many directions, distracting them from the actual work.’ An acute trust leader made the point that further devolution cannot take place without first clarifying accountabilities, which was reinforced through the recent NHS Providers survey on regulation. Future developments in this area should be co-produced with ICS leaders and other system partners to ensure clarity about roles and responsibilities.

Adopting a long-term approach

The NHS Confederation, other health and care membership bodies and think tanks have been clear that, while ICSs are well-placed to deliver long-term improvements to population health, they will take time to embed and will require long-term political commitment to realise their full benefits. A joint ICB/ICP chair we spoke to asked for an ‘understanding that the things we’re being asked to do are long-term – we won't change life expectancy in two or five years, but we might have a fighting chance in ten years or 15 years.’

Analysis of similar integration reforms internationally demonstrates that culture and behaviour take time to catch up with major legislative or policy reforms. While some ICSs have been operating for several years before the Health and Care Act, others have not benefitted from a history of collaboration between NHS, local government and other partners. ICS leaders are clear that they believe integration is the only way to achieve improvements in population health outcomes and improve system performance. As one ICB chair commented:

“The NHS has been through so many changes, however it will take time for everyone to realise that this latest change is going to be permanent and will not be reversed by the next minister or government. If this were to happen, the NHS would, in my view, be irreparable.”

It will be important that current and future governments recognise the international evidence that integration reforms take time to improve population health outcomes, and continue to make a long-term commitment to ICSs, allowing them to deliver local reform to services.

Summary of recommendations

On behalf of ICS leaders, we make the following recommendations:

Social care workforce plan
We welcome the NHS Long Term Workforce plan but call on the government to develop an equivalent plan for the social care workforce to recognise the contribution and value of this sector.

Capital spending review
We support the government’s commitment to reviewing the entire NHS capital regime in response to the Hewitt review. We call on the government to include in this review the amount of capital funding as well as the complex allocation process.

Support for new commissioning functions
NHSE should work closely with ICBs to ensure that they have access to the data and the capacity they need to effectively discharge their new commissioning functions.

Devolve to evolve
As the Hewitt review and the Health and Social Care Select Committee proposed, DHSC and NHSE should focus on setting a small number of targets based on outcomes and give ICSs the freedom to innovate in how they deliver against these.

Co-production
Through their response to the Hewitt review and new operating framework, DHSC and NHSE have committed to embedding a co-production approach. Co-production of policy and guidance impacting ICSs should become the norm. This should include, in particular, work on system accountability arrangements.