The must read stories and debate in health policy

Crackdown on the biggest borrowers

National leaders have set out new measures to control spending in health economies deemed to be “living off bailouts”, which may result in some contracts having to be revisited for the current financial year.

The latest attempt by NHS England and NHS Improvement to curb spending is described as a “capped expenditure process”, HSJ has learned, and focuses on the combined financial performance of providers and commissioners in a health economy.

It is understood that consultancy firms have been commissioned to work with some of the areas identified.

Yesterday, HSJ revealed which sustainability and transformation partnership areas are likely to be targeted by national leaders for overspending.

Although most of the 2017-18 contracts between providers and commissioners have been signed, there have been warnings over the huge efficiency assumptions built into many of the deals. This has resulted in large financial gaps, for which savings plans have not been identified.

The new process, which has been set out in a letter seen by HSJ, is targeted at health economies that “cannot produce plans which fit within the available financial envelope”, or where the agreed plans are “highly unlikely to be deliverable” due to unrealistic efficiency expectations. In some cases the procedure may be targeted at an STP patch, and in others across a smaller geography.

Election update: Good news for the NHS?

In his leader, HSJ editor Alastair McLellan writes:

Viewed over a three to five-year timeframe, the decision by Theresa May to call a snap election on 8 June could prove to be a net positive for the NHS.

If we assume that we are not in for another seismic political shock, the election is likely to return a Conservative government with an increased majority.

This would be good news – when compared to the current situation – for the NHS on four fronts.

The first is that the government is unlikely to continue to tie itself to the pledges made in the 2015 manifesto not to raise taxes and could possibly even abandon its commitment to the triple lock on pensions.

This, in turn, would give them the opportunity to revisit the 2015 spending settlement and provide a 70th birthday present to the NHS during the leanest years stretching from 2018-19 and beyond.

In this context, the publication of the Five Year Forward View refresh late last month has turned out to be particularly fortuitous – as the government (and other parties) are all now very clear about the trade-offs the NHS is having to make to stay within budget.