Understanding the NHS deficit and why it won’t go away

This briefing assesses the financial health of those providers by unpicking the headline figures presented in the official accounts to reveal the true underlying state of the NHS’s finances today, and to outline prospects for the next three to four years | Nuffield Trust

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Image source: Nuffield Trust

  • NHS trusts have begun the current financial year, 2017/18, on course for an underlying overspend or deficit of £5.9 billion. To meet their reported deficit target of £500 million, they will need to cut their operating costs by £3.6 billion and receive temporary extra funds of £1.8 billion.
  • This would require trusts to make savings in one year equivalent to 4.3 per cent of their operating costs – far in excess of any level achieved over recent years and likely to be almost impossible to deliver.
  • A more likely scenario is that they will make cost savings similar to the level made last year. That would collectively leave the trusts with an underlying deficit of around £3.5 billion.
  • The headline deficit for 2016/17 (which ended in March 2017) was £791 million. However, that figure was flattered by billions of pounds’ worth of one-off savings, temporary extra funding and accountancy changes that did nothing to improve the underlying state of provider finances. Once they are removed, the underlying deficit for 2016/17 is £3.7 billion.
  • This is compared to an underlying deficit the year before, 2015/16, of £4.3 billion. As trusts also had to soak up additional inflation costs in 2016/17, the reduction in the underlying deficit between 2015/16 and 2016/17 actually represents providers making £2.3 billion in permanent savings.
  • Projections of future years suggest that, even under optimistic assumptions for inflation and continued high levels of savings, NHS providers will continue to run a large collective underlying deficit until at least 2020/21.

Read the full briefing here

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What’s behind delayed transfers of care?

Why are we waiting? The causes of DTOCs | By Nigel Edwards for the Nuffield Trust

As the data shows, the NHS had remained responsible for the majority of DTOCs over time, but the proportion for which social care are responsible has grown by 84 per cent since December 2010.

The data also allows us to explore the reasons for delays. The most significant change since November 2010 has been an increase in the number of days delayed due to patients waiting for a care package to be available either at home (172 per cent increase) or in a nursing home (110 per cent).

While the reduced availability of social care is often highlighted as the cause of DTOCs, 57 per cent of the delays occurred because of issues in the NHS.

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Image source: Nuffield Trust 

Read the full briefing here

Why extending GP hours won’t solve the A&E crisis

Rosen, R. Nuffield Trust. Published online: 16 January 2017

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After a week of grim news about NHS emergency services, weekend newspapers shifted the focus onto primary care, with reports that the Prime Minister had apparently pointed the finger of blame at general practice. The Telegraph reported that she planned to “relieve the pressure on crisis-hit Accident & Emergency units” by demanding “that GP surgeries meet the government’s pledge to open from 8am to 8pm, seven days a week”.

A look at the evidence suggests that increasing seven-day access to GP appointments may reduce the total number of people coming to A&E. However, it is unlikely to affect the rising tide of patients waiting on trolleys in hospital corridors, and there is a risk that it might take GPs away from work that addresses the root causes of these problems.

Read the full blog post here

Introducing OPEL: a new way to understand winter pressures

This year, a new system has been introduced which permits a little more analysis of the operational pressures facing NHS hospitals in winter | Nuffield Trust Blog

Trusts have been required to record any days on which they have reached any of four different Operational Pressures Escalation Levels, known as OPELs. OPEL 1 involves ‘meeting anticipated demand within available resources’, and OPEL 2 denotes a trust ‘starting to show signs of pressure’. Levels 3 and 4 correspond more closely to the old terms such as ‘black alert’ or ‘major incident’.

So far this winter we have had data published since the start of December, allowing us to get a sense of how the NHS is coping with the considerable pressures it is facing. While it may be too soon to tell how winter 2016/17 is affecting the running of NHS hospitals, a look at the OPEL data does offer us an early clue.

The figures published by NHS England for the period 1-27 December show that:

  • Around a third (50) of the 152 trusts that sent data into NHS England declared an OPEL 3 or 4. Of those, seven were OPEL 4s.
  • In total, 201 OPEL 3 or 4s were declared between 1-27 December, of which 15 were OPEL 4s.
  • The start of the weeks of the 12th and 19th of December saw two peaks in number of trusts at OPEL 3 and 4.
  • The worst day in this period was Tuesday 13 December, with 23 trusts at the highest levels, including four at OPEL 4.
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Image source: Nuffield trust

Read the full blog post here

 

Care quality measures

The Health Foundation and Nuffield Trust have published Quality at a cost: QualityWatch annual statement 2016.

This report looks at a range of care quality measures across the NHS in England. It highlights several areas of health care where standards have improved, but the authors point to slowing improvement in other areas, growing waiting times and continuing financial pressures.

QualityWatch routinely monitors over 300 indicators spread across all domains of quality. This report considers a selection of areas from within this set, covering different stages of a patient’s experience of the health service, to give a picture of quality in 2016.

It looks across six main areas:

  • Public health
  • Primary care
  • Ambulances
  • Hospital care
  • Mental health
  • Condition-specific care (stroke and hip fracture)

The report observes that the pressure of austerity did not impact on quality measures straight away, but took a few years to be felt. Authors conclude that further ‘delayed decline’ could occur in other aspects of care quality, such as effectiveness of treatment or patient safety, given the extent of the challenges faced and ongoing austerity in health and social care spending.

NHS pressures undermining relations between doctors and managers

A new survey of hospital managers and senior doctors finds signs that they are working together better than in the past, but warns relations have been damaged by reorganisation and financial pressures | Nuffield Trust

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The poll of 472 leaders and clinicians in management roles is published today in the Nuffield Trust report Managing doctors, doctors managing, along with results from interviews, a focus group and a review of academic literature. It finds that 60% now believe local doctor-manager relationships are positive, up from 47% in a 2002 study, and respondents are now more confident that managers put patient care first. However, a higher proportion of respondents (37%) now believe relations are likely to deteriorate over the coming year, compared to only 13% in 2002.

Read the overview here

Read the full report here

Not so fast: how to slow activity growth

Ginsbury, S. Nuffield Trust. Published online: 21 Oct 2016

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As edicts go it is neither the most catchy nor the most inspiring, but the new NHS must-do was finally articulated in last month’s joint operational planning guidance from NHS England and NHS Improvement: activity growth moderation.

Activity growth moderation means what it says on the tin: slowing the pace at which the amount of activity the NHS does grows. That’s not the same as an absolute reduction in the level of activity or number of patients being treated but it does mean reducing the amount of care provided in the future compared the amount of care that would be providing were activity to continue to grow at the current trend.

That current trend is around three per cent extra care a year – measured in terms of more patients, with more complex needs, receiving more advanced health care, at a higher quality. All things being equal, the current level of funding would be able to sustain an activity growth rate nearer 2.4 per cent a year. But that would leave zero headroom to cope with periodic shocks such as a disease epidemic or the potential fall-out from Brexit. Perhaps for that reason, NHS England aims to reduce growth by one percentage point.

Read the full blog post here