This month the NHS has been reminded from all directions of the scale of the financial challenge it faces. While much of the focus of debate about the NHS continues to be the structural changes that are now taking shape, the bigger question remains how the health and care system is going to cope with the financial pressure it faces in the coming years.

At the beginning of December, the chancellor’s autumn statement announced the government’s intention to continue to maintain health spending up to 2015/16 while most other departments are likely to continue to experience real terms reductions in their funding.

‘We have heard a lot about integration but too often it has been two dimensional’

But a report by the Nuffield Trust the same week warned that the NHS could face a “funding gap” of up to £54 billion by 2012/22 without real terms funding increases.

In the shorter term, it warned, the NHS faces the prospect of cutting services or reducing the quality of care by 2014/15 as the prospect of making continued productivity gains begins to tail off − in other words, many of the more painless methods of saving money are going to be exhausted.

Artifical divides

The challenges facing the NHS are to some extent much less acute than those of many other public services. Local authority budgets, the police and welfare spending are all falling much more rapidly. But taken together with social care, the NHS and its partners face the longer term trend of steadily rising demand as the population ages and chronic illness and disability take up an ever larger proportion of its funding.

Whether the scale of the “Nicholson challenge” is £15 billion or £54 billion, the implications for the health and care system remain much the same. Small-scale, one-off efficiency savings are not going to do the trick. The entire system has to reform itself, not so much structurally as in the way it supports people’s health, wellbeing and independence.

Artificial divides, be they between health and social care, physical and mental health, or primary and secondary care, need to be dismantled.

We have heard a lot about integration this year but too often it has been two dimensional and focused on only part of the picture. From the perspective of the service user, any form of dis-integration is unhelpful and sometimes disastrous.

Stark choices

One of the biggest forms of dis-integration in our system continues to be that between physical and mental health support. Yet this year the Centre for Mental Health reported clear evidence that up to 10 per cent of the NHS budget is spent on the extra costs of treating long-term physical illness caused by the coexistence of mental health problems.

‘A decade of austerity may in the end spur on some long overdue fundamental changes’

From having liaison psychiatry teams in general hospitals to better collaborative care arrangements in the community, much of this cost could be saved.

The first clinical commissioning groups to be authorised will begin to face some stark choices in the way they spend their money next year. Most are already grappling with these dilemmas as they consider how to cut costs.

Perhaps uniquely among public service commissioners, they do not have to make dramatic immediate cuts to their spending. They have the opportunity − the necessity in fact − to take their time; to reform patterns of service provision and established ways of working; to shape health services on a different footing.

A decade of austerity may in the end spur on some long overdue fundamental changes to our health and care system. To do otherwise is to risk the health and wellbeing of every one of us in the years to come.

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