05 September 2003
Health ministers' proposed overhaul of NHS finances came under fire this week, with one senior analyst claiming that plans to standardise prices for patient treatments were based on 'dubious information' passed to the government.
Former Health Secretary Alan Milburn's decision to introduce a payment by results (PbR) system of compensating NHS bodies for treatments – which underpins the Department of Health's ambitious proposals to improve patient choice and the efficiency of the NHS – was discussed by delegates at a CIPFA health seminar on September 2.
DoH officials are currently consulting on their PbR proposals for England, which will be rolled out across the sector from next year, and include plans to introduce a 'single tariff' for treatments that currently vary in price across NHS bodies.
But Julie Renfrew, an independent health consultant, warned that the underlying price information collated by the DoH, upon which the new tariffs would be based, was 'a load of dubious information'.
Other critics of the proposals, which could be fully implemented by 2007, claimed that many NHS organisations were ill-prepared for such a swift and radical overhaul.
But Bob Dredge, the DoH's programme manager for financial reforms, said the department did not view the proposals as final, adding that the DoH was 'open to all ideas'. However, he warned finance directors that they should not expect too many concessions before the roll-out.
He reiterated that there would be no major cash boost set aside for implementation – although there would be 'one-off' transitional payments for selected costs.
Dredge told sceptics that they must 'get out of the bunker [mentality] that this is too difficult, because… politicians aren't going to respond to that. Finance directors get big money to do big jobs – they've got to deliver.'
However, the issue of the single tariff remains prickly.
In future, these will be calculated according to the average price for a treatment currently paid across the NHS. But the transition means that organisations that currently charge a higher-than-average fee will have to slash costs.
The DoH believes this could largely be achieved through 'efficiencies'.
However, finance directors reminded Dredge that higher fees were often a reflection of better-quality treatments and that by asking some trusts to cut costs, the DoH would in effect be asking them to reduce quality.
And Renfrew warned: 'If in future "high cost" trusts can only recover their costs at a national rate… some of them face serious financial issues.'
PFsep2003
