Hospitals 'will close if they have to find more savings'

3 May 11
NHS foundation trusts have warned that they would struggle to find extra efficiency savings and some would close
By Helen Mooney

4 May 2011


NHS foundation trusts have warned that they would struggle to find extra efficiency savings and some would close.

Last week, regulator Monitor said that hospitals could be forced to make savings of 6%–7% each year for the next five years, compared with 4% announced by the Department of Health.

‘In some cases these savings [of 6%–7%] will mean a serious threat to the sustainability of organisations,’ the chair of the Foundation Trust Network, Sue Slipman, told Public Finance.

‘Most of our members are saying that 4% will be very tough but achievable, but that 6%–7% will be extremely difficult to achieve and most will not be able to deliver it,’ she added.

In a letter to applicant and existing foundation trusts, Monitor warned that higher than expected inflation, combined with tough financial penalties for areas such as emergency re-admissions, meant that many hospitals would need to save more than expected.

Commenting on the regulator’s figures, a spokeswoman for the DoH said: ‘Monitor’s assessment of 6%–7% is its “downside case”, meaning it is more pessimistic. But it is right that Monitor's assessments are challenging – we want all hospitals to be able to meet Monitor's standards and show that they can provide sustainable, high-quality and efficient services for their patients.’

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