HSJ analysis: Fines for breaching A&E target could rise by over a third

NHS England’s draft standard contract for 2015-16 proposes to change the cap on financial penalties for failure to treat, admit or discharge 95 per cent of A&E patients within four hours.

Currently, providers are fined £200 for every patient who takes the trust below 95 per cent, but this is capped once performance falls to 92 per cent.

Under the new proposals, the fine per patient will be cut to £150, but fines will not be capped until performance falls to 85 per cent.

HSJ has calculated how much hospitals would have been fined in the first nine months of the current financial year if the proposed system had been in place.

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Overall, the provider sector would have faced a bill of £48.6m, compared with £35.4m under the current rules – an increase of 37 per cent.

NHS Providers’ head of analysis Siva Anandaciva questioned whether the increased penalties were “a step towards or away from” the vision of collaboration and service improvement set out in the NHS Five Year Forward View.

He added: “While NHS England’s intention may be to encourage operational resilience and service improvement in urgent and emergency care, the reality is that these increased fines will simply place more pressure on A&E departments that are already facing unprecedented increases in activity.

“We need a contracting approach that shares gain and pain across the system far more effectively and which places a more proportionate emphasis on the use of financial levers to improve clinical outcomes.”

Using December 2014 as a sample month, HSJ found that trusts that missed the A&E target but had performance higher than 91 per cent would benefit from the new penalty regime.

For example, County Durham and Darlington Foundation Trust, which saw 92.4 per cent of patients within four hours, would have incurred fines of just £91,432 in that month. Under current rules, it could be fined £121,910.

By contrast, Barts Health Trust, with performance of 85.2 per cent last month, would have incurred fines of £511,965 under the proposed rules, compared with just £209,508 under the present system (see table, below).

This suggests the new system will reduce financial pressure on trusts that narrowly miss the target, while increasing penalties on those that are struggling the most.

NHS England has told clinical commissioning groups that they must publish full details of any fines that should be levied on providers, alongside the amounts actually collected.

The national body has also made clear that CCGs will have to levy the penalties.

In the past CCGs have taken local decisions on whether or not to impose fines, but this flexibility has been removed.

An NHS England spokesman said: “The NHS constitution sets standards for patient waiting times, including in accident and emergency.

“A&E departments are funded at 100 per cent of tariff for additional attendances, and that is matched by longstanding incentives for seeing patients safely and quickly.

“However, rather than the current arbitrary threshold for the penalty set at 92 per cent, it makes more sense to respond equally to more of the breaches while also cutting the per person penalty by 25 per cent from £200 per patient down to £150.”