Following the Money: The trusts with the biggest drops in productivity

NHS England last week provided some headlines from ongoing work to understand its productivity challenges, finding the acute sector was around 10 per cent less productive than pre-covid.

ONS analysis – which adjusts for quality – doesn’t paint the picture of doom shared by some commentators.

The statistics body has found that in 2021-22 the health service rebounded from the mid-covid slump and was just under 7 per cent less productive than 2019-20. Not great, but not catastrophic considering the impact of a pandemic.

But the main issue with the ONS data is the two-year lag, meaning it comes too late for NHSE to do anything about it. Hence the new analysis outlined last week.

Many of the problems identified by Julian Kelly aren’t new: social care capacity, creaking infrastructure and increased length of stay.

NHSE insiders regard the latter as one of the biggest blocks on productivity, creating higher costs as patients spend more time in hospital while reducing the amount of elective activity.

All to play for on capital

In his report to the NHS England board, Mr Kelly said extra cash for the NHS estate was a “critical dependency” for productivity improvement. It’s a plea that has been made before, not least in the workforce plan.

Currently government departments have no budgets beyond the end of 2024-25, when the current spending review period finishes. The NHS has a nominal promise of £3.4bn extra for tech in future years, but on everything else it’s all to play for.

Given the upcoming election and growing consensus that some of today’s productivity crisis stenms from the post-2010 capital squeeze, NHSE will be hoping this makes fertile ground for infrastructure investment lobbying.

The 10-year capital strategies being drawn up by ICSs will help inform that ask – and help local areas prioritise any share of capital investment they might get under a future government.

As noted previously, NHSE is currently considering the thorny issue of how to introduce “incentives” for productivity improvement in a policy framework focused on systems rather than individual organisations.

Those anticipating the return of foundation trust freedoms may have longer to wait. Following the Money wonders whether any incentives are likely to take the shape of capital reward pots akin to those for balancing revenue budgets and, more controversially, delivering emergency care improvements.

‘You shouldn’t need a multiple tab spreadsheet to understand your staffing growth’

Alongside this, NHSE has been asking trusts to carry out local productivity assessments. Following the Money has seen a copy of the Workforce Productivity Diagnostic Tool that has been circulated to acute and specialist providers.

It echoes the national analysis, finding that these trusts have, on average, seen a 10 per cent drop in productivity as staffing has increased by 14 per cent and activity by just 2 per cent.

The document compares changes between 2019-20 and the midpoint of 2023-24. Just under 120 of the 136 acute and specialist providers saw a drop in productivity, with just 15 reporting an improvement.

The activity measured takes in outpatients (including follow-up appointments), total elective admissions, non-elective admissions and A&E attendances. This is then compared to staffing growth to produce an implied change in productivity.

It then sets out measures it says are “aligned to forthcoming productivity metrics”. These include outpatient appointments per consultant, A&E attendances per doctor and elective admissions per clinical staff member.

Providers have also been asked to identify “non-activity generating” staffing - likely to be non-clinical staff, or investments in maternity services or safer wards – and consider how this affects overall productivity.

NHSE’s assessment of trusts with the biggest drops in productivity from 2019-20 to mid-2023-24

Trust	Workforce growth	Activity growth	Productivity change
Manchester University Foundation Trust	23%	-24%	-39%
Barts Health Trust	22%	-20%	-34%
Epsom and St Helier University Hospitals Trust	23%	-18%	-34%
North Middlesex University Hospital Trust	30%	-11%	-31%
Frimley Health Foundation Trust	10%	-23%	-29%
Liverpool University Hospitals Foundation Trust	18%	-13%	-27%
East Cheshire Trust	6%	-20%	-24%
North Cumbria Integrated Care Foundation Trust	15%	-12%	-24%
Royal Cornwall Hospitals Trust	21%	-6%	-23%
Warrington and Halton Teaching Hospitals Foundation Trust	8%	-16%	-22%

When contacted, some of the trusts that had seen the biggest declines in reported productivity said their figures had been distorted by workforce increases when they brought outsourced cleaning staff in-house or took on new services.

Barts, for example, said it had taken an extra 2,000 staff porters, cleaners, security and domestic staff in-house from an external contractor, which skewed its workforce figures. It said it had agreed a revised productivity gap of 20 per cent with NHSE.

Epsom and St Helier said it had insourced around 800 staff, while Manchester University FT pointed to additional services and staffing transfers from other providers.

A blunt tool

All of this underscores just how difficult it is to measure productivity. Trust sources who spoke to HSJ argued the exercise had the right intentions but overlooked important nuances.

One finance manager said: “Overall it was a useful exercise but massively over-complicated. You shouldn’t need a multiple tab spreadsheet to understand your own whole-time equivalent [staff] movements and how this correlates to changes in activity.”

Other sources said the tool overlooked extra staffing in community and maternity services, which made a trust look less productive on paper because activity in these areas was not being counted.

This was a point raised by Amanda Pritchard in evidence to MPs last year, when she said existing measures do “not reflect what is happening in community care. It does not count things like virtual wards. It does not count all the community activity”.

Another finance director pointed out the measurement included types of activity the NHS is trying to reduce, such as outpatient follow-ups and non-elective admissions.

They said: “It’s the activity/productivity element that needs to be looked at again, especially around [the] non-elective side, Amanda Pritchard said a number of months ago they’re reading/measuring this wrong, so why keep using it?

“…I could improve my productivity by increasing my non-elective admissions, but is that what the policy says? Is that what we should be doing? Will it help us achieve the bed occupancy targets?”

NHSE sources stressed that the tool should be used to understand broad patterns and trends, rather than being seen as the definitive answer on productivity. A spokesman said it should be used “alongside multiple other factors and datasets”.

Of course, there is a clear value to an analysis which reveals relative productivity and helps trusts identify changes they might need to make. What’s less helpful is it becoming a stick to beat people with.