Health Insurance Fund: Transfer of funds for Primary Care Services

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A decision made 4 December 2013:

Decision Reference: MD-TR-2013-0109
Decision Summary Title:	Approval for Transfers from the Health Insurance Fund to the Consolidated Fund in 2013, 2014 and 2015		Date of Decision Summary:	26th November 2013
Decision Summary Author:	Head of Financial Planning		Decision Summary: Public or Exempt?	Public
Type of Report: Oral or Written?	Written		Person Giving Oral Report:	N/A
Written Report Title:	Approval for Transfers from the Health Insurance Fund to the Consolidated Fund in 2013, 2014 and 2015		Date of Written Report:	26th November 2013
Written Report Author:	Assistant Accountant, Financial Planning		Written Report : Public or Exempt?	Public
Subject: Health Insurance Fund (HIF): approval for the transfer of funds to the Consolidated Fund to fund primary care services by the Health and Social Services Department (H&SS) in 2013, 2014 and 2015 and specific approval for the 2013 transfer of £2,000,000.
Decision(s): The Minister approved the transfer of £2,000,000 in 2013 and gave ‘in principle’ approval for the transfers of £6,000,000 in 2014 and £6,000,000 in 2015 from the HIF to the Consolidated Fund, for use in funding primary care service delivery by H&SS. The Minister delegated authority to the Treasurer of the States to approve the 2014 and 2015 transfers by Treasurer’s Delegated Decision upon receipt of an invoice from H&SS and a satisfactory report from Internal Audit.
Reason(s) for Decision: The Minister for Treasury and Resources committed to manage the transfer from the HIF to the Consolidated Fund, and to only release funds on receipt of evidence from H&SS confirming expenditure in respect of primary care services. The Minister for Social Security and the Minister for H&SS both agreed this process as part of the Medium Term Financial Plan (MTFP) 2013-2015. £6,131,000 was transferred in 2011 and 2012. The Health Insurance Fund (Miscellaneous Provisions) (Jersey) Law 2013 permitted the States to approve further transfers in 2013, 2014 and 2015. The transfers were agreed by the States in the MTFP 2013-2015 (P69/2012) on 8th November 2012 and P88/2012 on the same date.
Resource Implications: The process itself will reduce the HIF by £2,000,000 in 2013, £6,000,000 in 2014 and £6,000,000 in 2015 and provide funding via the Consolidated Fund to H&SS of an identical amount for primary care services.
Action required: Head of Decision Support to inform the Head of Financial Planning, Head of Treasury and Investment Management and the Finance Director of H&SS that the 2013 transfer of £2,000,000 has been approved. The Treasurer of the States to approve the transfer of funds in 2014 and 2015 from the HIF to the Consolidated Fund by Delegated Decision upon receipt of an invoice from H&SS and a satisfactory report from Internal Audit.
Signature:		Position: Senator P F C Ozouf, Minister for Treasury and Resources
Date Signed:		Date of Decision:

Health Insurance Fund: Transfer of funds for Primary Care Services

Treasury and Resources

Ministerial Decision Report

APPROVAL FOR TRANSFERS FROM THE HEALTH INSURANCE FUND TO THE CONSOLIDATED FUND IN 2013, 2014 AND 2015

Background

In November 2010, the States approved the Health Insurance Fund (Miscellaneous Provisions) (Jersey) Law 2011. This Law provided for 2 transfers to be made, one in 2011 and one in 2012, from the Health Insurance Fund (HIF) to the Consolidated Fund, to meet the cost of various primary care services which are provided directly by Health and Social Services Department (H&SS). This funding was provided as part of the 2011 States Business Plan, which allowed for growth in H&SS expenditure, and removed various user-pays proposals from the H&SS CSR proposals.

These transfers were made under strict conditions and were tightly controlled by the Minister for Treasury and Resources. Treasury officials confirmed that each transfer was made in accordance with the agreed conditions, and the funds transferred were fully utilised in the provision of primary care services.

2. Medium Term Financial Plan 2013-2015 and P88/2012

In order to ensure that H&SS can undertake essential preparatory work on its long-term strategy for improved health care in the Island, it is necessary to create further transfers from the HIF.

The Medium Term Financial Plan (MTFP) which was approved by the States of Jersey on 8th November 2012 identified contributions from the HIF in each year of the MTFP. The Health Insurance Fund (Miscellaneous Provisions) (Amendment) (Jersey) Law 2013, also approved by the States on 8th November 2012, provided for a transfer of funds in 2013 in the total sum of £2,000,000, and a further £6,000,000 in both 2014 and 2015.

These transfers are to be used only to fund primary care services provided by H&SS and will be subject to the strict control of the Minister for Treasury and Resources.

The ring-fencing of Social Security and HIF Funds continues to be of paramount importance, and it is acknowledged that a commitment was given in 2010 to identify a sustainable solution for primary care funding. Significant progress has been made in the last 2 years towards improving the provision and governance of primary care services in Jersey and to set out a clear and practical path towards the overall improvement of health and social services in general.

3. Process

An identical process is being used to monitor this expenditure as was operated in 2011 and 2012. This involved a review by Internal Audit to check the evidence of expenditure claims.

The Minister for Treasury and Resources has committed to manage the transfer from the HIF to the Consolidated Fund and to only release funds on receipt of evidence from H&SS, confirming expenditure in respect of primary care services.

Internal Audit will review the claims and report on the accuracy of the evidence to support the expenditure. A transfer can then be made to the income of H&SS to the value of the claim but not exceeding £2,000,000 in 2013, £6,000,000 in 2014 and £6,000,000 in 2015.

Payment approval of the invoices from H&SS in 2014 and 2015 can be delegated to the Treasurer and this report proposes that the Minister for Treasury and Resources agrees the proposed process and appropriate delegation.

Recommendation

The Minister for Treasury and Resources is recommended to:

approve the transfer of £2,000,000 in 2013 and give in principle approval for the transfers of £6,000,000 in 2014 and £6,000,000 in 2015, from the HIF to the Consolidated Fund, for use in funding primary care service delivery by H&SS, and
delegate authority to the Treasurer of the States to approve the 2014 and 2015 transfers by Treasurer’s Delegated Decision upon receipt of an invoice from H&SS and a satisfactory report from Internal Audit.

Reason for Decision

The Minister for Treasury and Resources committed to manage the transfer from the HIF to the Consolidated Fund and to only release funds on receipt of evidence from H&SS confirming expenditure in respect of primary care services. The Minister for Social Security and the Minister for H&SS both agreed the process as part of the Medium Term Financial Plan (MTFP) 2013-2015.

£6,131,000 was transferred in 2011 and 2012. The Health Insurance Fund (Miscellaneous Provisions) (Jersey) Law 2013 permitted the States to approve further transfers in 2013, 2014 and 2015. The transfers were agreed by the States in the MTFP 2013-2015 (P69/2012) on 8th November 2012 and P88/2012 on the same date.

Resource Implications

The process itself will reduce the HIF by £2,000,000 in 2013, £6,000,000 in 2014 and £6,000,000 in 2015 and provide funding via the Consolidated Fund to H&SS of an identical amount for primary care services.

Report author : Assistant Accountant, Financial Planning	Document date : 26th November 2013
Quality Assurance / Review : Head of Financial Planning	File name and path: L:\Treasury\Sections\Corporate Finance\Ministerial Decisions\DSs, WRs and SDs\2013-0109 - Transfers from HIF to Consolidated Fund\WR - Transfers from HIF to Consolidated Fund.doc
MD sponsor : Treasurer of the States