By Tash Shifrin
29 October 2009
NHS leaders have warned that the government might seek to squeeze health service spending by locking down the treatments price tariff for five years and clawing back surpluses.
The warning comes as summarised accounts laid before Parliament revealed a breakdown of the NHS’s £1.738bn surplus for 2008/09. The accounts, signed off by the National Audit Office, describe ‘a significant surplus’ in every strategic health authority area.
NHS hospital trusts reported a total £235m surplus, with 135 producing an aggregate £352m surplus and 14 reporting a total deficit of £116m. Primary care trusts underspent by a total of £448m, while SHAs ended the year with a combined underspend of £1.055bn.
The surplus figures do not include the £269m retained by the largely autonomous foundation trusts in 2008/09, declared in consolidated accounts from the regulator, Monitor, in May.
The 2009/10 NHS Operating Framework allowed the health service to carry forward last year’s surplus and to draw down around £800m over two years in a ‘planned and managed way’. A surplus of around £1.5bn is projected for 2009/10.
But NHS managers are concerned that the tariff and operating framework for next year – likely to be published in late November or December after the chancellor’s Pre-Budget Report – will include measures aimed at clawing back money.
With savings being sought in all areas, NHS chiefs are feeling vulnerable, although both major parties have pledged to protect NHS funding.
Nigel Edwards, policy director at the NHS Confederation, described the possibility of surpluses being clawed back as ‘a hazard’.
The Department of Health might seek to grab back the money by basing next year’s uplift on a percentage of spending outturn figures, rather than the originally budgeted amount, he told Public Finance.
Edwards added that he was also ‘expecting a four- or five-year tariff’, rather than the present system of annual tariffs, locking down the prices that hospital trusts are paid for treatments in the medium term. This was likely to include ‘volume controls’ – a cap on NHS activity.
He suggested that possible controls included setting a limited ‘global budget’ to restrict both the number of treatments and the possibility of trusts securing more cash through case-mix payments.
Less restrictive options could entail paying only a marginal sum for treatments carried out beyond a stated ceiling.
Chris Calkin, spokesman for the Healthcare Financial Management Association, predicted ‘changes around how A&E and non-elective activity will be paid for’.
29 October 2009
NHS leaders have warned that the government might seek to squeeze health service spending by locking down the treatments price tariff for five years and clawing back surpluses.
The warning comes as summarised accounts laid before Parliament revealed a breakdown of the NHS’s £1.738bn surplus for 2008/09. The accounts, signed off by the National Audit Office, describe ‘a significant surplus’ in every strategic health authority area.
NHS hospital trusts reported a total £235m surplus, with 135 producing an aggregate £352m surplus and 14 reporting a total deficit of £116m. Primary care trusts underspent by a total of £448m, while SHAs ended the year with a combined underspend of £1.055bn.
The surplus figures do not include the £269m retained by the largely autonomous foundation trusts in 2008/09, declared in consolidated accounts from the regulator, Monitor, in May.
The 2009/10 NHS Operating Framework allowed the health service to carry forward last year’s surplus and to draw down around £800m over two years in a ‘planned and managed way’. A surplus of around £1.5bn is projected for 2009/10.
But NHS managers are concerned that the tariff and operating framework for next year – likely to be published in late November or December after the chancellor’s Pre-Budget Report – will include measures aimed at clawing back money.
With savings being sought in all areas, NHS chiefs are feeling vulnerable, although both major parties have pledged to protect NHS funding.
Nigel Edwards, policy director at the NHS Confederation, described the possibility of surpluses being clawed back as ‘a hazard’.
The Department of Health might seek to grab back the money by basing next year’s uplift on a percentage of spending outturn figures, rather than the originally budgeted amount, he told Public Finance.
Edwards added that he was also ‘expecting a four- or five-year tariff’, rather than the present system of annual tariffs, locking down the prices that hospital trusts are paid for treatments in the medium term. This was likely to include ‘volume controls’ – a cap on NHS activity.
He suggested that possible controls included setting a limited ‘global budget’ to restrict both the number of treatments and the possibility of trusts securing more cash through case-mix payments.
Less restrictive options could entail paying only a marginal sum for treatments carried out beyond a stated ceiling.
Chris Calkin, spokesman for the Healthcare Financial Management Association, predicted ‘changes around how A&E and non-elective activity will be paid for’.
