How does health care funding in England work?
Frequently asked questions about funding flows and allocations in the English health care system.
Funding for health services in England comes from the budget of the Department of Health and Social Care (DHSC). The majority of the DHSC resource budget is transferred to NHS England with the remainder divided between DHSC’s other agencies and programmes, including funding for arm's-length bodies like the Care Quality Commission (CQC) and the National Institute for Health and Care Excellence (NICE).
NHS England’s budget is used to support and oversee the commissioning of health services. It allocates this budget to different parts of the NHS.
Abolition of NHS EnglandPlease note that since the Government announced in March 2025 that NHS England will be abolished, the flow of resources will change. Some of the functions that used to be with NHS England are already in the process of being transferred to the DHSC.
This article will be updated with new information when it becomes available.
Integrated Care BoardsAs of 2024/25, most of the NHS England budget goes to integrated care boards (ICBs). ICBs are statutory NHS organisations in England responsible for planning, funding, and delivering local health services for their population. There are currently 42 ICBs but this number is set to reduce.
ICBs use their funding to commission a wide range of services including mental health services, urgent and emergency care, elective hospital services, primary care services (general practice), medicines and community care.
An ICB is responsible for assessing needs and commissioning health services to meet all the reasonable requirements of the individuals it has responsibility for. This is with the exception of certain services directly commissioned by NHS England (or DHSC in future), and public health protection and promotion services commissioned by NHS England, local authorities, the Office for Health Improvement and Disparities, or the UK Health Security Agency.
Direct commissioningFrom the remaining resources NHS England directly commissions certain services at a national level. For example, NHS England directly commissions ‘specialised’ services (such as treatments for rare conditions and secure mental health care), military and veteran health services and health services for people in prisons.
Central fundingThe remainder of NHS England’s budget is spent on centrally administered projects and services, such as screening programmes.
What is the latest NHS funding allocation?Health expenditure was £202.9 billion in England in 2024/25. This equates to around £3,462 per head. See the Library’s briefing on NHS expenditure for more information.
What NHS funding breakdowns are available?The DHSC does not routinely publish a breakdown of NHS spending by sector. It is therefore not possible to say how much has been spent on provision for specific illnesses or services.
Some information has previously been provided through Parliamentary Questions (PQs) but the latest data is for 2023/24.
Funding allocations by NHS TrustNHS Trusts do not receive funding allocations as such. Instead, ICBs commission specific services from Trusts (and other health care providers in their area) through contracts.
It is possible to find some information on income and spending in individual trusts’ annual reports and accounts. For instance, the documents contain information about income from patient care activities, as well as the source of income.
The below shows an example from the Hillingdon Hospitals NHS Foundation Trust annual report and accounts:
More detailed information can only be obtained through a freedom of information (FOI) request to a trust.
What information is there about different Integrated Care Board funding streams?Most funding for NHS services in England is distributed via ICBs, who use the funding to commission the majority of local health services in England, including for hospitals and GPs.
ICBs are provided with annual resource allocations to cover the costs of providing health services for the population they cover.
Core service allocationsThese cover secondary care such as hospital, community, mental health and ambulance services.
Primary medical care (PMC)PMC allocations cover any expenses related to general practice services.
Other primary careICBs can take on delegated responsibility for other primary care services, which comprise dental services (primary, secondary and community), general ophthalmic services, community pharmacy services, and other elements of primary care services. A separate allocation is calculated for these services.
Specialised allocationsSpecialised services (for example, treatments for rare conditions and secure mental health care) are not available in every local hospital because they have to be delivered by specialist teams of doctors, nurses and other health professionals who have the necessary skills and experience.
In total, there are 150 specialised services. On 1 April 2025, NHS England delegated responsibility for 70 specialised services worth £14 billion per year to ICBs.
A breakdown of funding allocations for each specialised service is not publicly available. Combined data on physical and mental health specialised services funding can be found in the NHS England ICB allocations publication.
Where can I find more information? ICB fundingMore information on how ICB funding allocations are calculated is available from the Library’s briefing paper on ICB funding in England. The Excel file attached to the briefing also contains information on funding allocations broken down by ICB.
NHS ExpenditureThe Library’s briefing on NHS expenditure also contains information on NHS expenditure over time.
Structure of the NHS in England and the rest of the UKFor a more detailed explanation of the structure of the NHS in England and the other UK countries, see the Library’s briefing paper on the structure of the NHS in England.