News

CCGs' £2.4bn contracts that could financially benefit board members

CCGs in England have awarded nearly 500 contracts worth at least £2.4bn to providers in which one or more of their board members had a financial interest, an investigation has found.

The investigation, jointly led by the BMJ and the Times, revealed that 50 CCGs awarded contracts despite a clear conflict of interest being present. A total of 437 out of just over 5,500 contracts were given to healthcare providers in circumstances where one or more CCG board members had a declared interest.

The probe confirmed an earlier investigation by NHE that revealed nearly one-fifth of CCGs have required more than half of their board members to withdraw from a meeting because of conflicts of interest.

But even if some GP members leave board meetings at times, NHS England’s current rules on conflicts of interest are relatively loose, with the BMA’s GP committee chair dubbing it “too permissive”.

The rules grant CCGs the freedom to self-determine whether conflicted board members should be forced out of relevant parts of meetings, or still join discussions but refrain from voting when governing bodies have to commission services.

These rules, which ultimately leave the course of action at the CCG chair’s discretion, have now become the root cause for wide variation in conflict handling across the system – and an inevitable lack of accountability for how public money is spent.

However an NHS England spokesperson told the investigators: “Robust statutory guidance on managing conflicts of interest for CCGs has been published with input from the National Audit Office (NAO) and other regulators.

“A national audit is underway to look at how these arrangements are working in practice.”

But the BMJ is adamant that its latest investigation ultimately reignites calls to entirely ban GPs from holding board positions in a CCG if they are directors of the provider organisation it commissions.

NHE has previously shown that GPs don’t have to be directors to have a vested interest in providers. In a case study by the NAO, eight members of Barnet CCG were also shareholders in Barndoc Ltd – its out-of-hours service provider.

The contract also covered Enfield and Haringey, and it was revealed that four members of Enfield CCG were shareholders in Barndoc Ltd and one of them was the medical director. In Haringey, one member of the CCG and her husband held shares in the company.

Today’s investigation has also put a price tag to the contracts awarded despite conflicts of interest, with most of the cash raised – £2.2bn of the £2.4bn total – going to NHS trusts or other similar organisations providing acute, community and mental health services.

Social enterprises were the next highest earners from these contracts (£64.6m from 13 deals) – but these values kept cascading down to limited companies, large commercial firms, confederations, general practices, hospices, councils, nursing homes and charities.

Recurrent issue

The contracts examined accounted for deals made between April 2013 and July 2015, covering a sample of 151 of England’s 209 CCGs.

But they follow on from a similar BMJ investigation in March 2013, which had already revealed that over one-third of GPs on CCG boards had a potential conflict of interest.

Similar investigations have been carried out since, with the Unite union finding that one in four governing CCG body members have links to private healthcare companies.

The Royal College of General Practitioners, the BMA and NHS Clinical Commissioners have also voiced fears that financial conflicts could affect the ability of commissioners to develop new models of care.

And more recently, NAO questioned CCGs’ transparency in managing financial conflicts, noting 75 instances in 2014-15 where the level of details given about potential or actual conflicts, and how they were managed, was varied.

As a result of mounting evidence, the BMJ has now concluded that CCG boards may have “become conflicted” under the 2012 health reforms which gave GPs control of around two-thirds of the NHS budget.

Reacting to the findings, Meg Hillier MP – chair of the Public Accounts Committee, which held an evidence session last year into GP out-of-hours services – told the BMJ that politicians may be forced to hold another inquiry into the wider issue of conflicts of interest.

“It’s not just transparency and accountability, but the appearance of those things. We want to look at that. There is definitely a governance issue.

“There needs to be the same level of standards for CCGs as there are for charities. This is taxpayers’ money. There should be nothing to hide,” she added.