Background

Statutory integrated care systems (ICSs) were established in July 2022 to fulfil four core purposes, including to tackle inequalities in outcomes, experience and access. When ICS leaders were surveyed in 2023, this ranked as the primary ambition system leaders would like to have achieved in five years’ time. However, one in five ICSs stated that they did not feel confident in their ability to tackle inequalities, and none were ‘very confident’. 

To respond to this the NHS Confederation, in partnership with the Care Quality Commission, Clarity Consulting and Leeds Beckett University, undertook a project to understand how systems are approaching this purpose and to share key principles of effective working. Representatives from 36 ICSs (86 per cent of systems) volunteered to take part, and a sample of 20 were selected for interview. Discussions explored three areas:

• allocation of funding
  
  
• decision-making processes
  
  
• enablers, barriers and how to overcome challenges.

See the appendix for more information on the methodology. 

This report aims to support ICSs to understand effective principles for allocating health inequalities funding, based on systems’ experiences of developing strategies and plans to address inequalities. It also reflects key external obstacles in allocating funding and makes recommendations on how these can be overcome locally and at a national scale. The report is accompanied by a practical toolkit, developed for system leaders across England, on how to implement high-impact changes to address health inequalities. 

This work uses the additional £200 million health inequalities allocation in 2022/23 and 2023/24 as a way to explore systems’ approaches to addressing health inequalities. As of 2023/24, the funding for tackling healthcare inequalities was included in the NHS baseline budget. As such it will increase in line with inflation but will not be ringfenced in budget allocations to systems.

While this report focuses on the £200 million funding to integrated care boards (ICBs), health inequalities is one of the factors taken into account when determining the total ICB budget allocation. The focus on this £200 million provides an insight into how ICBs approach tackling health inequalities. 

This project was instigated after independent analysis of the three ICSs in Yorkshire showed significantly different approaches to how this funding was used in 2022/23. These ranged from supporting a range of strategic place-level programmes through to using all the funding to meet general financial challenges in the ICS. This analysis was presented to the NHS Confederation’s ICS Health Inequalities Reference Group, which requested a review to understand the approaches taken across the whole of England.

It was considered probable that the variation in approaches identified in Yorkshire was replicated across England. If action on health inequalities is to be sustained and have a significant impact, it is important that local health systems are able to learn from other systems how funding can be used most effectively. 

As spending is the responsibility of the ICB, this project interviewed health inequalities leads from integrated care boards and focuses on the role of the ICB. This happens in tandem with integrated care partnership (ICP), local authority and place and neighbourhood level activity, all of which is crucial to addressing health inequalities. 

To explore the role of the ICP further, please see Integrated Care Partnerships: Driving the Future Vision for Health and Care. For insights on the relationship between local public health teams and ICBs, please read NHS England’s Delivering a Quality Public Health Function in ICBs.

Context

It is important to recognise the following factors when considering how ICBs are responding to the challenge of improving the way in which health and care systems take action to address health inequalities.

First, as the Institute of Health Equity notes in its 2020 report, since 2010, life expectancy in England has stalled and inequalities in life expectancy have increased. Among women in the most deprived decile, life expectancy fell between 2010-12 and 2016-18. Inequalities in healthy life expectancy also fell, meaning that people in more deprived areas spend more of their shorter lives in ill health. Large government funding cuts have affected the social determinants of health across the whole of England, but more deprived areas experienced larger cuts.

Second, ICSs are comparatively new. They were legally established in July 2022, with reducing health inequalities as one of their four statutory purposes. While many ICSs have been able to build on the relationships developed by previous structures, others have been less able to do this. This has particular implications for work on health inequalities as long-term trusted relationships with communities and places experiencing health inequalities are particularly important with regard to building and maintaining momentum.

Third, in 2022/23 the NHS faced significant short- and long-term financial pressures against the backdrop of recovering from the impact of the COVID-19 pandemic. Other very challenging issues continue, including ongoing industrial action.

Fourth, in ICS’s second year there have been further pressures, including the announcement of a 30 per cent reduction in running costs allowances commencing in the financial year 2023/24, followed by a letter in November 2023 requiring ICBs to achieve balance for that financial year. This reduction in management funding combined with resulting organisational changes created further challenges with regard to the use of funds, such as the health inequalities funding allocations, and other funds such as the winter social care fund, for their original purposes.

Finally, consideration of actions taken by ICBs to address inequalities needs to recognise not just the complexity of addressing this wicked issue but also that the NHS is operating in an environment where there has not been a cross-government health inequalities strategy since 2010. The impact of this has been compounded by constrained funding, which has impacted particularly on local government, but also on the NHS itself by increasing demand exacerbated by people’s declining living and working conditions across society. A government white paper on health disparities was due for publication in 2022, before being shelved in 2023, and replaced by the major conditions strategy, due for publication in 2024. Health inequalities is expected to feature as an underpinning issue in the major conditions strategy, but is not the strategy’s core focus.