Key takeaways
Integrated Health Organisations reshape NHS delivery
IHOs aim to integrate care and manage full budgets locally.
Financial planning and risk-sharing are critical
Clear governance and robust data underpin sustainable IHO models.
Global lessons guide successful integration strategies
International examples stress prevention, digital tools and aligned incentives.
A key part of the ambitious 10-Year Health Plan for the NHS in England is the establishment of Integrated Health Organisations (IHOs).
Defining the IHO approach
From the 10-Year Health Plan it’s proposed that the IHO’s will be created from strong Foundation Trusts (FTs) to manage an entire healthcare budget for a local population, similar to US-style accountable care organisations.
They will be tasked with integrating services for the population across primary, community, mental health, and social care – reducing the reliance on hospitals. The whole budget management and focus on population health outcomes will incentivise IHOs making investment into prevention/early intervention initiatives as well as digitally enabled care/self-management.
There will be a qualifying process set out for the high performing FTs looking to become an IHO with the expectation that this approach will become the new normal to redefine provider roles and contracting models.
This is an important point, from the plan and role which is set out, the IHO would be based more on a contractual approach for existing FTs rather than a new organisational form.
Learning from past initiatives
Establishing an IHO in the NHS in England will therefore present both a transformative opportunity and a complex challenge. Drawing on lessons from previous initiatives such as accountable care initiatives, vanguards, integrated care partnerships, and consortium models, we have outlined some of the critical considerations for the areas of the NHS tasked with implementing IHOs.
Previous initiatives for integrated care models in the NHS highlighted the importance of local adaptation, strong leadership, and shared values among partner organisations. However, they also revealed challenges in governance, resource allocation, and sustaining collaboration over time.
Financial challenges and risk sharing
Setting up IHOs will require careful financial planning, including agreeing on the financial envelope and establishing appropriate risk share arrangements across commissioners, the IHO and the stakeholder providers.
Establishing a capitated budget that reflects population needs requires robust data, actuarial modelling, and consensus among stakeholders. Risk-sharing arrangements must be carefully designed to avoid penalising providers for factors beyond their control, such as social determinants of health or demographic shifts.
Lessons from US ACOs show that unclear financial responsibilities and poorly defined risk-sharing mechanisms can lead to disputes and undermine service delivery. Some ACOs failed to achieve savings due to inadequate risk adjustment, lack of provider engagement, and misaligned incentives. Successful models, such as Kaiser Permanente and Geisinger Health System, demonstrate the importance of integrated IT systems, strong primary care foundations, and aligned financial incentives.
The financial governance around the IHO arrangements will need to be transparent and robust.
Governance, leadership, and membership
Effective governance will be essential for IHOs. Consortium models must define clear membership criteria and decision-making processes that reflect their values. Leadership plays a pivotal role in maintaining credibility and driving progress across multiple stakeholders. Training and support for potential IHO leaders can strengthen the approach and ensure continuity despite staff or trustee changes.
Strategic partnerships and commissioning
Building strategic partnerships with local authorities and commissioners is vital. A co-production approach can foster mutual understanding and align service delivery with statutory duties. ULOs have shown that proactive engagement and shared outcomes can enhance commissioning and improve service user involvement.
Learn from international models
Internationally, there are many integrated care models which you could look to learn from. Examples such as Kaiser Permanente in the US and Gesundes Kinzigtal in Germany have demonstrated success through aligned incentives, strong digital infrastructure, and population health management. In Sweden, the Norrtälje model integrates health and social care under a single budget and governance structure, improving outcomes for older adults.
These models and others emphasize prevention, coordinated care, local flexibility, long-term funding and outcome-based accountability, principles that IHOs in England will need to adopt.
Where next
The route toward establishing IHOs in England will be complex but previous work around accountable care in England and also internationally shows that this is achievable. However, clarity is needed on how IHOs will be authorised, monitored, and held accountable for population health outcomes.
By learning from past initiatives, addressing financial and governance challenges, and drawing inspiration from successful international models, the NHS (through FTs and ICBs) should look to build integrated care approaches that are resilient, equitable, and responsive to local needs.
We have advised numerous NHS and international organisations on the establishment and operation of integrated care approaches and contracts. If you would like to discuss this further please contact us.
