Covid may have had long-term impact on NHS, warns IFS

Max Warner, research economist at the IFS and an author of the report, said: ‘The NHS is showing clear signs of strain heading into the winter, and is treating fewer patients than it was pre-pandemic across many types of care. The real risk, almost three years on from the start of the pandemic, is that the Covid hit to NHS performance is not time-limited. Going forward, we need to grapple with the possibility that the health service is just able to treat fewer patients with the same level of resources.’

The report argues that the impact of inflation on the NHS may be underestimated in the Treasury’s calculations because it relies on the GDP deflator, which only includes domestic inflation – not that which comes from goods which are largely imported such as gas, fuel and some foods. Current predictions suggest the more-widely used CPI measure of inflation – which includes these – is likely to be much higher than the GDP deflator.  

A new report by the IFS into NHS funding and treatment volumes highlights a number of points.

• The additional funding for the NHS announced in the autumn statement won’t cover the full impact of inflation on the service. The intended 3.4 % real terms increase in funding between 2019/20 and 2023/24 is unlikely to be delivered and, even with the extra money, the NHS will see growth in funding of just 2.9% above inflation for this period. This is below the historic average of 3.6% and the report suggests the NHS may need extra funding in 2024/25.
• While the number of clinical staff has increased, parts of the NHS are treating fewer patients thanpre-pandemic. This includes falls in the number of emergency admissions, outpatient appointments and elective and maternity admissions compared with the same period in 2019. #however, GP appointments and first cancer appointments have risen.
• Covid is still having an impact with 5% fewer beds available to non-covid patients than before the pandemic with about 8,500 beds occupied by covid patients on an average day in the third quarter of 2022. Nearly two-thirds of these did not have Covid as the main reason for being in hospital.
• Patients who are ready for discharge, but still in a hospital bed, are at high levels, making up more than 40% of those who have been in hospital for more than 21 days compared to 34% in the same period in 2021. Patients who have been in hospital for more than seven days are 14% up on the same time last year. And those who have been in hospital for more than 21 days are 24% up.

But the report concluded that, although the NHS is struggling, there is no simple solution. ‘It is not obvious that (somehow) adding more staff or money would immediately unclog the system,’ it said. While bed numbers seem to be part of the problem, increasing these – even if they could be staffed – ‘could prove insufficient to improve and the flow of patients through the system and increase overall treatment capacity.’

It also suggested that ‘insufficient or ineffective management’ could be one reason why the whole system appears to be functioning less effectively. Manager numbers have grown, but not in line with the number of clinical staff, it added, and the NHS already had relatively low levels of spending on governance and financial administration before the pandemic. 

NHS Providers’ interim chief executive Saffron Cordery (pictured above) welcomed the report’s spotlight on the pressures facing an overstretched NHS. ‘Bed occupancy was around 95 per cent at the last count, above the level considered safe,’ she said. ‘There is no let-up in demand on services hamstrung by severe staff shortages – with more than 133,000 vacancies in trusts across England alone. Trusts face recurring pressures from Covid-19, which will continue to have major financial and operational impacts in future.’

She added that pressures from years of under investment were coming together. She called on the government to ‘fix chronic staff shortages and an underfunded social care system to help ease pressure right across the health and care system’.