Kernow Clinical Commissioning Group (CCG) has been placed under legal directions by NHS England.
The CCG was allocated £728.7 million funding and was forecast to have a £0.5 million surplus, according to a recent NHS England report of the first quarter of 2015/16. However, it is now heading for a £14 million end-of-year deficit.
The commissioners will need to give NHS England an analysis explaining the reasons behind the un-forecast financial decline, and a turnaround director will be appointed to them by NHS England.
Simon Bell, NHS Kernow’s chief finance officer, said: “NHS Kernow has a good track record in financial performance, having delivered financial surpluses in the first two years of operation.
“However, our financial situation has worsened… A number of financial pressures have recently emerged – particularly an overspend on individual packages of care for patients with complex health needs.”
Kernow must now produce a “credible” financial recovery plan to show how it will operate within its annual 2016/17 budget, and remain in financial balance in the following years.
Dr Iain Chorlton, chairman of NHS Kernow, explained: “As a local system, we do not want to reduce core services, so we must transform them. To help towards this improvement in efficiency, NHS Kernow and our local partners are committed to integrating services to reduce duplication and improve them for people.
“As our ambitious plans to integrate services gather pace and become firmly embedded locally we are confident that patient experience and outcomes will further improve and demand on some services will ease, which will also improve finances,” he added.
It is now the sixth CCG to have legal directions placed on them this financial year, along with East Surrey, Bedfordshire, Enfield, Surrey Downs, and Northern, Eastern and Western Devon.
This unexpected change comes after George Osborne, chancellor of the exchequer, announced a devolution deal for Cornwall, – including health and social care – in July this year.
A spokesperson for the CCG said that they see the Deal for Cornwall as being instrumental in resolving the financial challenges in health and social care by offering a new opportunity for integration.