THE COST OF REFORM

Jeremy Hunt has repeatedly failed to meet pledges on mental health care (The Guardian: 1 August 2017)

Jeremy Hunt, the health secretary, has announced plans to expand mental health provision with a £1.3bn injection that will see thousands of new posts created. This would be welcome news were it not for the fact that so far Hunt has failed to deliver on pledges that could have improved services.

For a start, the Health and Social Care Act (2012) made it unlawful to discriminate between physical and mental health. So far, regardless of whether it’s financial budgets or service delivery, mental health services have seen no significant improvement.

Indeed, we have seen the opposite; more than 50% of clinical commissioning groups cut their mental health budgets last year. There has been a trend that when the NHS is under financial strain, mental health budgets get disproportionate cuts. All too frequently we have seen health commissioners raid these budgets to plug growing deficits in the acute hospital sector. Hunt has had ample time to correct the chronic underfunding, and with many mental health organisations struggling with his government’s imposed austerity cuts, we would argue that this is too little, too late.

Mental health services are also facing increasing demand. One in four adults experience at least one diagnosable mental health problem in any given year. A leaked report by a government taskforce painted a devastating picture of England’s mental health services, revealing that the number of people killing themselves is soaring, that three-quarters of those with psychiatric conditions are not being helped and that sick children are being sent “almost anywhere in the country” for treatment. The failure to prioritise and ringfence resources for services has led to a crisis in mental health provision in this country.... read more

NHS plans 'not just about closures', bosses insist (The Guardian: 26 August 2016)

NHS chiefs have said a planned programme of radical changes to meet increased demand and plug funding gaps does not only involve cuts, after opposition politicians and campaigners expressed alarm at the plans.

An investigation by the Guardian and the campaign group 38 Degrees showed a possible shortfall of about £20bn by 2020-21 if no action is taken, prompting NHS England to ask 44 local areas to submit a cost-cutting “sustainability and transformation plan” (STP).

The shadow health secretary, Diane Abbott, called the report “a damning indictment of this government’s underfunding and mismanagement of the NHS”, while Chris Hopson, chief executive of NHS Providers, which represents frontline NHS leaders, said a “glut” of hospital services could shut down.....read more

 

Hunt hints at additional funding requirements for seven-day pilots (Pulse: 6 January 2016)

Seven-day GP access pilots established with one-off investment from the Prime Minister’s Challenge Fund could see an extra injection of funding to maintain them, the health secretary has said.

In a debate on health in Parliament today, Mr Hunt said the Department of Health was investigating way to maintain funding and prevent ‘turning the clock back’ on successful extended hours pilots.

Pilot areas that received start-up funding in the first and second wave of the fund were supposed to become self-sustaining by cutting the number of A&E attendances at weekends and evenings that could otherwise be seen by a GP but Pulse has reported that almost half of the pilots have already reduced opening hours, amid lacking patient demand and uncertainty over future funding...read more

 

NHS spends £1.8bn on staff redundancy pay-offs following Government restructuring (The Independent: 26 July 2015)

About £1.8bn has been spent on NHS staff redundancy pay-offs since the Government’s restructuring of the health service, according to new figures.

More than 44,000 people have been laid off in the last five years with some 5,500 re-employed by the NHS in another job, Sky News reported.

Some were given severance payments in excess of £200,000.

The shadow Health Secretary Andy Burnham, who is standing for Labour leader, told the broadcaster: “Today the figures hit a new high – £1.8bn wasted. And what are doctors to make of this?

“No wonder morale in the NHS is at rock bottom. This was a reorganisation that didn’t need to happen.

“They’ve thrown money at redundancies, given people pay-off cheques like confetti at the NHS at a time when we’re not doing right by the staff of the National Health Service.”

 

Jeremy Hunt's seven-day plan for GP surgeries could cost NHS £3bn a year (The Guardian: 24 July 2015)

Keeping a typical GP surgery open on weekends would cost an extra £500,000 a year, according to a report, which raises questions about the feasibility of health secretary Jeremy Hunt’s plans for a seven-day NHS.

If extended to England’s 8,000 practices, the analysis, based on “a typical English GP surgery in the home counties”, suggests the NHS could be left with a bill exceeding £3bn.

The calculations were carried out by Dr Morton’s, an online medical helpline staffed by GPs launching this month.

It arrived at the £500,000 figure, “a conservative estimate”, by adding up staff costs (with a premium for weekend working), overheads and medical indemnity insurance for opening from 8am to 8pm on Saturdays and Sundays. The figures were all taken from a home counties practice with five GPs and 8,500 registered patients.

Dr Morton’s GP Paolo Fargnoli, who is also a partner at a NHS practice in Cambridgeshire, said: “GPs like myself are concerned that the new deal and dream of a 24/7 service cannot work unless it is properly resourced.

 

NHS England warns of tough financial challenge ahead (Health Service Journal: 14 May 2014)

NHS England has warned of an “even more challenging” financial year than 2013-14 in an overview of the sector’s finances that revealed only one in four clinical commissioning groups have balanced plans. Papers due to be seen by the body’s board tomorrow also pointed to “significant weaknesses” in its specialised commissioning budget. These were described as a risk to the organisation’s finances this year.

The report showed that in 2013-14 19 CCGs finished the year in deficit, 10 more than had planned a negative position at the beginning of the financial year. Just four primary care trusts formally ended the year in deficit in 2011-12 and 2012-13 combined. Mr Baumann’s report warned that 2014-15 and the “years to come” would be “even more challenging” than the previous financial year, at a time where “means of easing” would be unavailable.

NHS England finished the year with an overall surplus of £790m, mostly made up of a £712m underspend by CCGs. This is equivalent to just over 1 per cent of CCGs’ £64bn combined budgets. While specialised commissioning was overspent by £376.9m, primary care – also part of NHS England’s direct commissioning budget – was underspent by £28.2m.

 

PM's seven-day GP pilot drastically reduces Sunday opening amid 'frequently empty' appointments (Pulse: 26 May 2015)

A pilot given £1m by the Prime Minister’s fund to increase weekend access has already scrapped Sunday appointments due to a lack of demand, Pulse can reveal.

Although the pilot in Hertfordshire and the south Midlands was aimed at offering GP appointments from 8am to 8pm seven days a week, Pulse can reveal that the the pilot has drastically reduced Sunday opening times following ‘an assessment of appointment utilisation’.

The news comes just days after Prime Minister David Cameron renewed his pledge to extend NHS access across seven days, starting with GP services.

Pulse has previously revealed that NHS Canterbury and Coastal CCG had dropped their pilot, funded by winter money, after it failed to reduce hospital pressures.

But this is the first known example of a so-called ‘Challenge Fund’ pilot cutting back on weekend access, as NHS England has extended the funding to the first-wave GP access pilots to allow for a ‘fuller analysis....read more

 

NHS acute services face a £2bn funding shortfall (Belfast Telegraph: 26 March 2014)

Acute services in the NHS in England are facing a year of particular financial pressure in 2015/16, when changes to funding arrangements will see £2 billion transferred to community health and social care provision, a parliamentary report has warned.

The House of Commons Health Committee highlighted a warning from the chief executive of health regulator Monitor, David Bennett, that the reduction in funding resulting from the introduction of the Better Care Fund from April next year will present a "huge challenge" to NHS providers of acute care - medical and surgical treatment mostly provided in hospitals.

In its report on Monitor's work, the committee warned that the current model of care is "not changing quickly enough" to cope with demand and funding pressures, resulting in a threat to both the quality of care received by patients and the financial stability of individual providers.

The cross-party committee called on both the regulator and NHS trusts to "address the need to develop different structures to meet changing needs". It warned that Monitor must not get in the way of necessary change by imposing "heavy-handed regulation" on trusts.

 

NHS hospitals set to make overall loss for first time since 2006 (BMJ: 24 March 2014)

NHS hospitals are set to make a loss of nearly £250m (€300m; $410m) by the end of this financial year, and experts have warned that budgets are coming under greater strain. David Flory, chief executive of the NHS Trust Development Authority, has warned in papers to its board that the deficits were “very worrying” and posed a “very significant risk to the sustainability of the sector.” In all, 26 NHS trusts of the 102 that do not have foundation status are forecast to be in the red at the end of March, posting a combined deficit of £457m.

Earlier this year Monitor, the body that regulates the 147 foundation trusts, reported that overall they were set to make a £135m surplus by the end of March. Taken together, the figures mean that NHS hospitals as a whole would make a net loss of £112m for 2013-14, the first such loss since 2006.

The figures reported to the NHS Trust Development Authority’s board meeting on 20 March showed wide variation in trusts’ financial positions. The biggest projected deficit, £39.8m, is recorded at University Hospitals of Leicester NHS Trust. Nine of 22 NHS trusts in London (41%) are forecasting a deficit, compared with two of 19 trusts (11%) in the north of England. Many acute care trusts have signalled that they face operational pressures in urgent and emergency care.

 

MPIG-reliant practice faces 25% drop in funding after NHS England backtracks on protection for 'outliers’ (Pulse: 17 February 2014)

A GP practice is considering slashing opening hours and cutting staff after it was told by area team managers that there was ‘no money’ to protect it from a 25% drop in income due to the withdrawal of MPIG. GPs at the Rowhedge and University of Essex Medical Practice in Colchester said that despite initial assurances they would be protected, they had recently been informed by the Essex area team that they were unlikely to have any additional funding allocated to them. The practice is set to lose a quarter of its funding as one of the 98 ‘outlier’ practices that were given initial assurances by NHS England in December that they would be protected from the swingeing cuts in funding brought about by the withdrawal of MPIG over seven years from April.

Dr Alan Speers, one of the GPs in the surgery, said their practice was so dependent on MPIG because one of their sites serves students at the University of Essex and the other is in a rural area. ‘We were thinking that OK, we are probably going to lose some money, but common sense will prevail and no one can survive with a 25% loss in their funding. But actually they seem quite happy for us to potentially fail.’

Essex LMCs chief executive Dr Brian Balmer said Dr Speers’ practice was one of 98 practices in serious trouble because the promised national agreement to protect practices heavily reliant on MPIG had never materialised. 

 

Funding reforms threaten GP stability (GP14 February 2014)

General practice in England is on the brink of the most wide-ranging overhaul of its funding arrangements in a decade. Few of England's 8,100 GP practices will escape the effects of a mammoth redistribution that could see close to £0.5bn in GP funding moved between practices or stripped from the profession, creating six-figure swings in practice income over the coming years. The driving force behind these changes is the coalition government's desire to equalise pay across primary care.

Although many GP practices will benefit financially from the changes, it will be at the expense of others - some of which could be forced out of business unless they negotiate local funding support from NHS England's area teams. Almost one in four GP practices in England - 40% of those on the GMS deal - will lose out to some degree from the removal of MPIG. The 98 worst-hit practices face average losses of £150,000 each. GPC chairman Dr Chaand Nagpaul has criticised NHS England's plan to leave its area teams to decide whether to offer extra support to affected practices. 'We are very concerned that the original commitment to a national approach to protect practices from destabilisation has not been honoured,' he said.

 

Pioneering brain cancer unit axed because NHS won't refer patients (Daily Mirror: 4 February 2014)

A pioneering brain cancer unit has been axed – because NHS chiefs have refused to send patients there. Leading doctors have begged David Cameron, who backed the plan, to step in. Private funding to build Oxford Gamma Knife Centre was in place and the first foundation stone was to be laid last week by Tory Health Minister Jane Ellison. But the ceremony was cancelled. The letter said the team was told NHS England – which commissions treatment – believed “it will not be possible to support a new centre in the current climate”.

It is an embarrassment for the PM as the unit was a joint venture between the NHS, Oxford University and private ­Nuffield Healthcare – exactly the type of ­partnership he has pushed for. A source said: “This was supposed to be the jewel in the crown of Tory NHS policy. This is beyond embarrassing for him and appalling for patients. “The hospital was being built for free at no cost to the taxpayer and patients would be treated at no extra charge.” Cancer patients lucky enough to get the innovative gamma knife surgery are currently forced to travel to Sheffield or London.

 

GPs fear pay chaos as NHS consults on admin cuts (GP Online: 27 January, 2014)

NHS England plans to slash funding by 40% to Primary Care Support (PCS) services, formerly known as Family Health Services, which administer GP payments and patient records. The cuts, first revealed by GP in September, could see the number of regional FHS offices slashed from 37 to 12 and savings of £40m targeted from a £100m overall budget. In a letter sent by the Birmingham, Solihull and Black Country area team, director Wendy Saviour said she would be seeking the views of practices. But Birmingham LMC executive secretary Dr Robert Morley said he feared the consultation was a ‘cosmetic exercise’. GPC leaders have warned the changes could create further practice payment problems following chaos caused by the introduction of new systems in April 2013.

 

7,000 key NHS clinical staff made redundant amid enforced cuts (The Guardian: 31 December 2013)

An "arbitrary" straitjacket on the NHS's budget by Whitehall is leading to job losses, recruitment freezes and inadequate care for patients, the leader of the country's doctors warns on Tuesday. Dr Mark Porter, chairman of the British Medical Association, said forcing the NHS in England to make £20bn of "efficiency gains" by 2015 at a time of rising demand for healthcare was wrong and damaging. Porter was speaking to the Guardian after the Department of Health (DH) admitted that 7,060 NHS clinical staff, such as doctors and nurses, have been made redundant since the coalition took power in 2010, at the same time as David Cameron was pledging to protect the service's frontline from cuts. The 7,060 total does include doctors, nurses, midwives, health visitors, ambulance staff and qualified scientific, therapeutic and technical staff, the DH said. "The NHS still has a mountain to climb in undoing the cuts that have already been made. In particular, we are concerned that some highly skilled specialists may be disproportionately targeted for cuts. The importance of safe staffing levels must be accepted throughout the NHS, and local organisations must be properly resourced to make them a reality for every patient."

 

The number of CCGs forecasting deficits nearly triples (Health Investor: 13 November 2013)

The number of clinical commissioning groups (CCGs) predicting to run a deficit this year has almost tripled to 24, while NHS England itself is forecasting an overspend of £93.2 million. Earlier this year, only nine trusts were forecast to make a deficit according to finance officials at NHS England. Only three primary care trusts (PCTs) – which CCGs replaced – ever recorded end of year deficits in any of the three years prior to 2013-14. NHS England gave three reasons for the deficits CCGs are predicted to run up: increased activity; failure to make quality innovation, productivity and prevention savings and “finalisation on the impact of specialised commissioning adjustments”.

 

NHS managers given £1 million payoff, then re-employed (Express: 2 November 2013)
 
A married couple were among around 50 senior staff to receive more than £100,000 to leave their jobs as part of the restructuring brought in by the Coalition's Health and Social Care Act.
 

NHS faces unexpected £500m cuts, say hospitals (The Guardian: 3 October 2013)

The NHS faces unexpected cuts of £500m that threaten frontline services, according to a body that represents hospital trusts. Despite the government's pledge to protect frontline services with real-terms increases in funding, Monitor, the NHS watchdog, has proposed that in 2014-15 hospitals should be paid 4% less for operations than they were the previous year. While hospitals were braced for a cut of about £1bn in funding, the Foundation Trust Network, which represents all 160 hospital trusts in England, calculates that Monitor is now asking for another £500m in savings – roughly £3m from each trust. Chris Hopson, chief executive of the Foundation Trust Network, said cuts to frontline services would be deeper than expected and questioned whether the NHS could invest in much needed changes to the way hospital services work, recommended by the Francis report into failings at Mid Staffordshire NHS Trust.

 

£1.4bn of NHS money "wasted" on redundancy payoffs, says Labour (The Guardian: 25 August 2013)

Labour has accused ministers of wasting £1.4bn of NHS funding on 32,000 redundancy payoffs over the past three years. More than 950 health workers received six-figure exit deals last year, up from about 620 in 2011-12, and 160 received more than £200,000, according to the annual Department of Health accounts. The shadow health secretary, Andy Burnham, said the "true cost" of the coalition's health service shakeup was becoming clear. The figures suggested that the final bill for the reorganisation would be far higher than the government had predicted, he said. "Billions have been siphoned out of the NHS frontline to pay for an unnecessary reorganisation no one voted for and David Cameron personally promised would not happen. It is a colossal waste of money."

 

A&E units to close despite £500million bailout plan (The Mirror: 12 August 2013)

More A&E units will have to close despite Jeremy Hunt's £500million bailout plan, the health watchdog has said. Eight in England and Wales have closed since 2007 and a further 18 are said to be under threat. The bleak warning came as figures showed frontline care in the NHS was facing an “unprecedented summer crisis”. David Prior, head of the Care Quality Commission, said some hospitals did not have enough doctors to offer safe emergency care – and indicated that more accident and emergency departments could close. He said: "It’s very hard for a small hospital to provide that kind of cover, because it’s so expensive. I think the reality is that some smaller A&Es will find it difficult.”

 

Cost of NHS reforms rises by £300m (The Telegraph: 18 October 2012)

Health secretary Jeremy Hunt has revealed that the NHS reforms will cost £300m more than originally estimated. In a written ministerial statement, Mr Hunt said that the implementation of the Health and Social Care Act in England would cost ‘in the range of’ £1.5bn to £1.6bn. Redundancy costs are expected to be around £630m, he said. The DH’s original impact assessment, revised last year, said the implementation costs would be in the region of £1.2bn to £1.3bn. Mr Hunt said that the long-term savings from the changes were estimated to be £1.5bn per year, from 2014/15 onwards. Gross savings over the transition period, which began in 2010/11 and is due to end next April, are estimated at £4.5bn.

 

NHS reforms will cost £3bn and will not work: academic  (The Telegraph: 10 July 2010)

Reform of the NHS planned under the government's white paper will cost around £3bn without saving money or improving patient care, a leading academic has warned in the British Medical Journal. He said "The transitional costs of large scale NHS reorganisations are huge, although they are often discounted or ignored, and the intended or projected savings from abolishing or downsizing organisations are rarely realised.

  

Bungled contracts force NHS to pay-out £186m (Bureau of Investigative Journalism: 25 March 2011)

Onerous contract provisions forced the government to buy back Independent Sector Treatment Centres, ISTCs, after five years. This means that despite a huge taxpayer investment nine of the 31 centres initially set up have been forced to close, and others will go the same way as contracts end.


See also:

Royal College of Nursing report (21 April 2013)

 
 

More on costs/bureaucracy: 

INCREASED BUREAUCRACY?

COSTS OF COMPETITION 

Key Facts:

Lords vote leaves controversial competition in place

81% of nurses said that paperwork prevented them from providing direct patient care

PAC say "efficiency savings" resulting in cuts and rationing

Nearly £3bn returned to the treasury by the department of health over the last 2 years

   

Key Trends:

Cost of restructuring rising

Costs of competition emerging, GPs worried

Staff experiencing rising paperwork

 

More layers of bureaucracy?

Insert Alt 

 

True or false? 

“We are abolishing needless bureaucracy, and our plans will save one third of all administration costs during this Parliament” – Channel 4 fact check on the NHS reforms

 

  

Related issue: NHS efficiency savings:

NHS Progress in Making £20bn Efficiency Savings - A report by the National Audit Office in December 2012
 
Savings achieved through staffing  "staffing cuts and rationing" - Public Accounts committee report  -13 March 2013
 
 
Views:

costs of the reforms:

"On the basis of the National Audit Office’s survey data, I estimate that the proposed NHS reorganisation will cost between £2bn and £3bn to implement, at a time of unprecedented financial austerity." - Prof Kieran Walshe, Jul;y 2010

cost of competition: 

"Using competition in such an arbitrary fashion would potentially create a barrage of bureaucratic tendering and procurement procedures, which would inevitably be paid for at the taxpayers’ expense." NHS Confederation chief executive, Mike Farrar

 

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