Comment / News review

Discussions over NHS finance at local and macro level were much in evidence this month as the future of the financially troubled South London Healthcare NHS Trust became clearer and MPs tried to pick apart the movement of funds between the Department of Health and the Treasury.

As October closed and November began, news on the future of South London Healthcare emerged. The district auditor issued a public interest report on the trust’s finances, which concluded it was no longer sustainable in its current configuration. He said the trust’s financial problems were characteristic of an organisation that began operation from a weak position – each of its predecessor trusts (including Queen Elizabeth in Woolwich, right) were in deficit, there were delays in addressing financial, clinical and capacity issues and the new trust inherited two expensive private finance initiatives (PFIs).

Later, the trust special administrator (TSA), appointed by the Department to recommend options for the trust’s future, published his report. Matthew Kershaw recommended a six-point, three-year transformation plan that would see the trust broken up and accumulated deficits put at £207m written off. The administrator said that following implementation the NHS in south-east London would be able to live within its means by the end of 2015/16. Operational efficiency had to improve to ensure costs were in line with the best-performing NHS organisations, while two of the trust’s three hospitals (which have major PFIs) should receive additional funds from the Department of Health until their PFI contracts end. Public consultation on the recommendations closes on 13 December and the TSA’s final recommendations will be sent to the health secretary early in the new year.

While there is some clarity in that part of London, there was little in another, the House of Commons. A Commons health committee hearing on public expenditure in mid-November asked health secretary Jeremy Hunt (left) and a number of senior Department officials about funding returned to the Treasury at the end of 2011/12. Each year the Department plans for an underspend and this is returned to the Treasury at year-end – a proportion of the underspend is added to the next year’s allocation. Did this mean the majority of the funding was no longer available to the NHS, asked MPs? No, it was available, the Department’s witnesses insisted – all the funds are made available in the following year, even though the Department receives only a proportion of the underspend from the Treasury. Struggling to understand, the committee asked to be sent a simple explanation – and probably a lie-down in a dark room.

The Commons public accounts committee also had a go at the Department. In a report, Securing the future financial sustainability of the NHS, the committee said the Department did not have a clear plan on how it would deal with a trust that goes bankrupt, nor could it provide assurance that financial difficulties will not affect the quality of patient services. The Department could not explain what would trigger a trust being placed in the failure regime and appeared to be ‘inventing rules and processes on the hoof’.

Monitor took on some of its new powers under the Health and Social Care Act and found a further foundation trust ?in significant breach of its terms of authorisation. Cambridge University Hospitals NHS Foundation Trust will be required to commission a review of board governance and effectiveness and appoint a board-level turnaround expert. Monitor took the action due to a failure to meet targets, multiple never events and poor financial performance. ?

There were also concerns over the quality of care across the NHS. The Patients Association produced 13 case studies, which it said showed ‘appalling’ examples of poor care, where patients are said to have been neglected, left in pain and without food and water. The Care Quality Commission (CQC) also warned that the increasing complexity of patients’ conditions and comorbidities, together with the rising pressure on staff, was affecting providers’ ability to deliver care tailored to individuals’ needs.

There was mixed news from the King’s Fund, which published an assessment of the government’s health policy. While NHS performance was holding up, unprecedented financial pressures could jeopardise the gains made over the last 10 years, it said. Major organisational change and the departure of experienced managers left the service in a precarious position. ?

But there was also good news for the NHS. A study of the impact of the Advancing quality programme in north-west England has estimated it saved hundreds of lives. A paper in the New England Journal of Medicine said mortality rates fell by 6% in the 18 months after the start of the programme, under which providers can earn top-ups to contract payments if they meet quality standards. This was the equivalent of 890 lives saved.

Also, the Department reported the number of people waiting more than a year for hospital treatment had fallen. In September it was just over 1,600 – 12 months earlier it had been more than 20,000. The number waiting more than six months was just under 46,000 – down more than 60,000 on a year earlier. Much of the fall has been put down to better recording of data, but ministers insisted the NHS had reduced waiting times.

While researchers suggested an obesity crisis would force trusts to borrow MRI scanners normally used by zoos for elephants, consultancy Ernst & Young warned of huge variations in the price trusts pay for smaller supplies. Its study looked at 10 NHS hospital trusts and found the prices paid for the same box of medical forceps ranged from £13 to £23. An identical box of blankets ranged from £47 to more than £120.

Seven pathfinders – clinical commissioning groups and local authorities – are to agree contracts with telehealth suppliers to allow 100,000 patients with long-term conditions to benefit from the technology next year. Health secretary Jeremy Hunt said there would be no upfront cost to the pathfinders. This follows publication of the first NHS mandate, which included a pledge to progress towards three million people being able to benefit from telehealth by 2017.