Written evidence submitted by Gianina Caballero (AHE0016)

Section 1: Who is submitting this evidence and why

My name is Gianina Caballero, and I am submitting this evidence in a personal capacity as an independent systems researcher with experience contributing to parliamentary and policy-facing work on public service delivery. I have worked within two different government contexts, giving me first-hand experience of how public systems are designed, funded and governed in practice, and how institutional constraints shape delivery outcomes.

I hold a master’s degree from the University of Oxford in Major Programme Management. In parallel, I have contributed analysis and evidence to the All-Party Parliamentary Group (APPG) on Project Delivery.

I am submitting this evidence because hospice provision constitutes essential but under-recognised infrastructure within England’s health and care system, with growing significance in the context of population ageing. In parallel, I am currently working on a project examining financial sustainability and systemic risk in care-related sectors, which has reinforced the concerns set out in this submission. Further information on my background and work is available at www.gianinacaballero.com

Section 2: Systemic failures shaping financial sustainability in the hospice sector

In reviewing the NAO’s report, I analysed its findings as features of a connected system rather than isolated sectoral issues. This systems-based analysis shows that current financial pressures are the predictable result of three core failures: a hybrid delivery model without system-level governance, a volatile and uneven funding architecture, and reliance on bottom-up adaptation instead of systemic correction.

1. A hybrid delivery architecture without system-level governance

Palliative and end-of-life care in England is delivered through a hybrid system combining NHS provision, independent charitable hospices and national providers across hospital, hospice, community and home settings. In practice, this operates as a single operational ecosystem but is not governed, commissioned or overseen as one.

Care availability and configuration are shaped primarily by local commissioning decisions and historically contingent capacity rather than by a nationally designed service model. Although hospice provision has become increasingly central to policy objectives such as care closer to home, reduced hospital utilisation and alignment with patient preferences, governance arrangements have not evolved to reflect this role.

NHS and independent hospices are operationally interdependent but institutionally separated, with different funding, accountability and data regimes and no consolidated national view of activity or costs. Government therefore relies on a system it cannot fully plan, oversee or stabilise, undermining equitable, reliable and financially sustainable provision.

2. A financial model built on volatile and uneven foundations

The financial sustainability of the hospice sector rests on a structurally fragile funding model. A substantial share of income is derived from charitable sources, which are inherently volatile and largely outside Government control. Public funding represents a minority share and varies widely between providers due to local commissioning decisions and fundraising capacity rather than consistent national criteria, exposing comparable services to very different financial risks.

At the same time, underlying cost pressures are rising, driven by workforce, energy and other non-discretionary inputs. NAO shows deficits returned to 64% of providers post-pandemic, demonstrating structural inability to self-correct without external support. Government responses have been largely reactive, relying on one-off capital support and reserve depletion, delaying visible failure without addressing structural risk or restoring sustainability.

3. Bottom-up adaptation filling a governance vacuum

In response to mounting pressure, some hospices have formed regional collaboratives to coordinate provision and share risk. These bottom-up arrangements improve local resilience but do not address underlying financial drivers, redistributing risk unevenly. With no national framework to govern or integrate collaboratives, resilience remains contingent, exposing a governance failure with direct implications for financial sustainability and value for money.

Section 3: International evidence on governance models securing financial sustainability

This section presents comparative evidence from Germany and the Netherlands on how governance architectures embed financial sustainability within hospice and palliative care. It focuses on the statutory, funding and coordination instruments that stabilise provision, allocate financial risk and reduce reliance on volatile buffers in hybrid delivery models. These cases offer relevant contrasts for England, where hospice provision performs an increasingly central system function without equivalent stabilisation mechanisms.

1. Germany: statutory anchoring and system-level stabilisation in a hybrid model

1a. Statutory responsibility and governance framework

Germany provides a clear statutory anchor for hospice and palliative care within its social health insurance system. The Hospice and Palliative Care Act[1], explicitly clarified that palliative care is an integral component of statutory health insurance, rather than a discretionary or supplementary service, establishing a baseline obligation on sickness funds to support provision[2]. Further statutory reinforcement was introduced through “39d SGB V”[3], which from 2021 created a legal basis for publicly funding the coordination of regional hospice and palliative care networks. This framework recognises coordination and network governance, rather than clinical delivery alone, as essential system functions, assigns shared financing responsibility to statutory health insurers and local authorities, and treats network coordination as auditable public infrastructure rather than voluntary activity.

2a. Funding architecture and risk allocation

Inpatient adult hospice care in Germany is funded predominantly through statutory health insurance, with eligible costs covered at up to 95 per cent, an increase from the previous 90 per cent threshold[4]. This applies to defined inpatient hospice care and does not represent overall sector income coverage. Other functions are funded through distinct channels, with ambulatory hospice support relying on a combination of voluntary activity, donations and targeted public subsidies.

Coordination and network governance are financed separately under “39d SGB V”, recognising these as system-level functions rather than costs to be absorbed by individual providers. This separation is matched by a deliberate allocation of risk: clinical and demand risk are absorbed by statutory health insurance; provider-level financial risk is limited through guaranteed baseline funding; coordination risk is assumed at system level through publicly funded network infrastructure; and patients are protected from direct financial exposure through the absence of co-payments. While local negotiation introduces variation, it occurs within a nationally defined legal framework that embeds palliative care within insured benefits and limits the transfer of systemic risk to providers.

3a. Network infrastructure and system coordination

Germany has invested in formal network infrastructure to support coordination across a fragmented provider landscape. Empirical research identified 308 regional hospice and palliative care network structures operating in Germany as of 2023 (Schwabe et al., 2023)[5]. However, network development is heterogeneous, and only a subset currently meets the statutory criteria for “structural” networks eligible for funding under “39d SGB V”, with limited early uptake reflecting implementation challenges.

Research on network development has produced a maturity model identifying four core dimensions relevant to effective functioning: infrastructure, governance, promotion and moderation[6]. This literature recognises multi-professional cooperation as a key determinant of quality, while highlighting the diversity of existing networks and the current lack of mature tools to assess and support their development at regional level. Sustainable infrastructure, competent network governance and adequate resourcing emerge as critical factors, alongside governance approaches that strengthen networks without undermining contextual flexibility.

4a. Implications for England

Germany’s model does not eliminate local variation or complexity. Contracting decisions remain decentralised, and transparency can vary. However, unlike England, Germany embeds hospice and palliative care within a statutory insurance framework that combines predictable baseline funding for core services, arbitration mechanisms within statutory contracting, and explicit public financing of coordination infrastructure. This enables Government to influence financial sustainability through legal and institutional instruments, including risk allocation and system coordination, rather than relying on charitable income as an implicit financial buffer.

2. The Netherlands: governance integration and quality-led financial stabilisation

1b. Conceptual and statutory framing

In the Netherlands, palliative care is defined in policy as a form of generalist care that should be provided by any healthcare professional when needed, rather than as a discrete medical specialty (Brinkman-Stoppelenburg et al., 2016)[7]. This framing supports a mixed generalist–specialist model integrated across the health system, though subsequent evidence points to persistent challenges in institutionalisation, resourcing and consistent implementation. Historically, public financing for long-term and end-of-life care was anchored in the Exceptional Medical Expenses Act (AWBZ), which guaranteed access through nationally pooled funding until major reforms in 2015 (Maarse & Jeurissen, 2016)[8]. These reforms dismantled the AWBZ and redistributed responsibility across health insurance, municipalities and individuals, shifting away from universal entitlement towards more conditional and decentralised support.

2b. Governance innovation and system integration

A distinctive feature of the Dutch approach is the Netherlands Quality Framework for Palliative Care (NQFPC)[9]. Developed using a whole-sector approach, the framework incorporated structured input from patients and families, professional associations and other key stakeholders. While health insurers were engaged through consultation and endorsement processes, they did not participate directly in all deliberative forums. The framework articulated nationally agreed standards and key elements for palliative care, creating a shared reference point across providers, settings and organisational boundaries. Rather than operating as a funding mechanism, it establishes a common understanding of the organisational, coordination and continuity functions required to support quality palliative care, with Government backing its integration into regular healthcare practice while leaving financing and risk allocation to subsequent policy and commissioning arrangements.

3b. Funding mechanisms and financial access

The Netherlands introduced targeted funding mechanisms for hospital-based palliative consultation and advisory services as early as 2012, signalling policy recognition of the need to support specialist expertise within general hospital settings[10]. However, comparative evidence indicates that palliative care funding remains fragmented, with mixed reimbursement models that are not consistently aligned with population need or service complexity. Despite statutory and governance initiatives, reliance on a combination of public funding, organisational discretion and informal arrangements persists, highlighting the limits of partial reimbursement reforms in securing financial sustainability.

4b. Implications for England

The Dutch case shows how governance integration and national standard-setting can shape conditions for financial sustainability without guaranteeing it. By defining palliative care as a generalist responsibility and embedding nationally agreed quality frameworks within mainstream healthcare governance, the Netherlands has sought to reduce fragmentation and clarify roles. However, sustainability remains uneven in the absence of a coherent funding architecture. For England, the lesson is not to replicate the Dutch model, but to recognise the value of national governance frameworks that link standards, commissioning authority and financial stabilisation, an alignment currently lacking, leaving sustainability reliant on local discretion and non-statutory buffers.

Section 4: Leverage points for restoring system control and financial sustainability

Drawing on the systemic failures identified in Section 2 and comparative evidence from Germany and the Netherlands, this section identifies three leverage points where targeted government action could restore system control and financial sustainability.

Leverage Point 1: Statutory accountability without system control

Integrated Care Boards are legally responsible for commissioning palliative and end-of-life care but lack the instruments to exercise effective system control. Limited visibility of hospice activity, fragmented expenditure data, the absence of national pricing and service-level continuity safeguards create a mismatch between statutory accountability and operational authority. This prevents the hybrid hospice–NHS model from being governed as a system (Failure 2a), locks in opaque and uneven funding (Failure 2b) and leaves stability dependent on bottom-up adaptation (Failure 2c). Germany demonstrates that statutory responsibility must be matched with pricing, data visibility and continuity protection if system control is to be real.

Leverage Point 2: Reactive funding without institutional learning or stabilisation

During COVID-19, Government demonstrated the capacity to fund hospices rapidly and in line with system need, treating them as critical infrastructure. This learning was not institutionalised: emergency funding remained exceptional, with no integration into routine commissioning, no stabilisation mechanisms and no early-warning indicators once system-wide stress emerged. As a result, structural fragility persists (Failures 2a and 2b), and providers are again forced to self-absorb volatility (Failure 2c). Germany embedded learning through law and stabilisation; the Netherlands pursued governance integration. England did neither.

Leverage Point 3: Misallocation of financial risk in a hybrid delivery system

Public funding continues to assume that charitable fundraising will absorb volatility, despite declining returns and reserve depletion. This misallocates system-level financial risk to individual providers, masking imbalance until service loss occurs. The result is accelerating fragility (Failure 2b) and horizontal risk-shifting between providers rather than system stabilisation (Failure 2c), undermining effective governance of the hybrid model (Failure 2a). Germany explicitly limits reliance on charity for core services; the Netherlands shows governance alone cannot compensate for weak financial anchoring.

Section 5: Suggested Government actions & Questions

1. Suggested Government actions

Immediate actions

1. Establish consolidated national data collection on hospice activity, costs and financial resilience across NHS and independent providers within 12 months.
   Germany’s statutory network reporting requirements demonstrate that system-wide visibility is achievable even in federated delivery models.
2. Require all ICBs to transition from grant-based funding to NHS standard contractual arrangements.
   Contracts should enable transparent measurement of commissioned hospice and palliative care activity against population need, rather than relying on historically inherited grant allocations.
3. Commission an urgent review of financial risk allocation across the palliative care system.
   This review should assess the continued validity of assumptions about charitable income, identify where financial risk currently accumulates, and specify what stabilisation mechanisms are required to protect system continuity.

Medium-term structural reforms

4. Provide statutory clarification of palliative and end-of-life care as essential system infrastructure within mainstream NHS commissioning frameworks.
   This clarification should focus on sustainability and continuity obligations, comparable to Germany’s 2015 legislative anchoring, rather than creating new clinical entitlements.
5. Develop national pricing guidance or reference costs for core palliative care services.
   This would enable equitable and transparent commissioning by ICBs and address the persistent pricing gap.
6. Establish legal and financial frameworks for regional hospice collaboratives.
   This would convert emergent bottom-up adaptation into governed system capability, with explicit accountability for geographic coverage, service continuity, quality and financial sustainability.

2. Key questions

Written evidence submitted by Gianina Caballero (AHE0016)

Questions to confirmed oral witnesses

To Baroness Finlay / Prof. Murtagh:

• From a clinical and service delivery perspective, how dependent is current palliative and end-of-life care provision on hospice services that operate outside NHS financial control?
• What risks does this create for continuity of care when those providers face system-wide financial stress?

To Hospice UK:

• To what extent can charitable income still be treated as a reliable buffer against rising costs and demand across the sector?
• What signals would indicate that financial pressure has shifted from being locally manageable to system-wide risk?

Questions to Government and system leaders:

• Which national body currently holds a consolidated view of hospice activity, funding flows and financial resilience across England?
• How does Government assure value for money when a material share of essential palliative care is delivered outside standard NHS contracting and pricing frameworks?
• What mechanisms exist to identify and intervene when financial risk becomes systemic rather than confined to individual providers?
• Should DHSC or NHS England be required to develop system-level stabilisation mechanisms for palliative and end-of-life care, comparable to those used in other essential services?
• What role should HM Treasury play in defining acceptable levels of financial risk transfer to charitable providers delivering essential care?
• How should Integrated Care Boards be held accountable for commissioning outcomes when they lack visibility, pricing tools and contractual control over hospice provision?

Concluding observations:

1. This is a system governance failure, not a provider issue: Hospice sustainability requires coordinated action across DHSC, NHS England, ICBs, Treasury and regulators.
2. Coordination is not institutionally governed: England relies on informal goodwill rather than a formal inter-institutional framework linking standards, commissioning, funding and service continuity across the system.
3. Funding alone will not fix the system: Without addressing governance, pricing, data visibility and risk allocation, additional funding will reinforce fragmentation rather than stabilise provision.
4. The lack of national frameworks diffuses responsibility. In the absence of system-level frameworks, accountability fragments and financial risk is displaced onto charities and local variation.
5. Money amplifies structure: Weak governance increases volatility; strong governance enables funding to restore control and predictability.

December 2025