PBR problems were flagged over a year ago

13 Oct 05
The government failed to act on warnings that payment by results could plunge NHS trusts into financial chaos, despite being told of the risks by the Audit Commission more than a year ago.

14 October 2005

The government failed to act on warnings that payment by results could plunge NHS trusts into financial chaos, despite being told of the risks by the Audit Commission more than a year ago.

Andy McKeon, the commission's managing director for health, told Public Finance that the potential for financial instability had first been identified in a report on PBR last July. 'The risks identified then have not been addressed,' he added.

Speaking as the commission published a new report on the first year of PBR, McKeon also conceded that the introduction of market reforms in the NHS was damaging some relationships between hospitals and primary care trusts, with wrangles over bills a major source of tension.

'It has polarised relationships in a number of places and created mutual suspicion on both sides.'

McKeon told PF that the information and data systems underpinning the new regime, used to generate the bills, were inadequate. 'There are a number of different systems that people can use, but there is no uniform system. It is an obvious piece of the jigsaw that needs to be put in,' he said.

The commission's latest PBR report, published on October 11, is also urging the government to overhaul the tariff structure – under which trusts receive a nationally set fee for different types of procedure – for non-elective or emergency services.

It says full PBR could force some A&E units to close because of the unpredictable nature of emergency admissions.

It is calling instead for trusts to receive a basic payment for providing emergency services, topped up by marginal payments once treatment levels go beyond a certain threshold, allowing greater financial certainty.

Commission chair James Strachan said: 'There are real dangers for the NHS in the short term, particularly given the recent increase in the number of organisations and areas with financial problems.'

Responding to the report, Health Secretary Patricia Hewitt insisted the government would press on regardless. 'PBR is not causing financial problems in the NHS. It is revealing problems in some NHS trusts and helping them to overcome their difficulties. PBR is part of the solution, not the problem.'

PFoct2005

Did you enjoy this article?

AddToAny

Top