England’s 10 most prestigious teaching and research hospital trusts have asked the Department of Health and the Treasury for a 10 per cent top-up to their tariff payments, HSJ can reveal.

The Shelford Group, which represents the most powerful hospital trusts in the NHS, asked the Treasury and the DH for an extra £700m this financial year, a Freedom of Information Act request reveals.

The 10 trusts have a combined income of £7.3bn a year but say this does not properly cover their costs because tariffs are set at the average price for a procedure and their caseload is more complex.

The news comes after two of the 10 – Imperial College Healthcare Trust and Cambridge University Hospitals Foundation Trust - ended 2011-12 in deficit.

The Shelford Group trusts are: University College London Hospitals Foundation Trust, University Hospitals Birmingham Foundation Trust, Cambridge University Hospitals Foundation Trust, Central Manchester University Hospitals Foundation Trust, Guy’s and St Thomas’ Foundation Trust, Imperial College Healthcare Trust, Oxford University Hospitals Trust, Sheffield Teaching Hospitals Foundation Trust, Newcastle upon Tyne Hospitals Foundation Trust and King’s College Hospital Foundation Trust.

At a meeting with the Treasury in November the Shelford Group asked for the 10 per cent increase as a “short term” solution and a “full review of [the] funding system to bring it into line with international best practice” in the longer term.

The DH confirmed Shelford representatives had met health secretary Andrew Lansley on 30 May this year and that a working group looking into the group’s demands had been set up.

University Hospitals Birmingham Foundation Trust chief executive and chair of the Shelford Group Dame Julie Moore said: “Trusts need to deliver a surplus to enable investment in capital infrastructure, equipment and new services for the benefit of our local patients as well as those receiving more specialist care. 

“At the moment tariff doesn’t accurately reflect the costs of delivering the highly specialist care that members of the Shelford Group deliver up and down the country. Other large specialist hospitals will be in similar positions.

“The potential knock-on effects [of underfunding] on local populations, medical research activity and the wider stability of regional health economies need to be understood.”

The presentation made to the Treasury said the proportion of the world’s clinical trials undertaken in the UK had fallen from six to 1.4 per cent and that “without a reversal in funding for the underlying research infrastructure this alarming trend will continue”.

Former Shelford chair and Cambridge University Hospitals Foundation Trust chief executive Gareth Goodier used an HSJ interview earlier this year to call for an end to the system that sees trusts in London receive top-up funding from NHS London, while those outside the capital go without.

NHS London agreed “Project Diamond” funds of £22.8m for the four London Shelford trusts in 2011-12.

The briefing document presented to Treasury officials said the 10 trusts would have ended 2010-11 with a combined deficit of £4m if it wasn’t for Project Diamond funding.

Related files/tables