The tougher non-payment policy for emergency readmissions could cost some hospitals even more in 2011-12 than the planned 1.5 per cent cut in tariff prices.
The Department of Health has set next year’s tariff prices 1.5 per cent lower, to reflect its requirement that hospitals make 4 per cent efficiency savings.
But some hospitals that have modelled the potential effect of the new tariff on their income have told HSJ they facefar greater pain from the policy of non-payment for patients readmitted within 30 days.
Countess of Chester Foundation Trust director of finance and compliance Jane Tomkinson said under current rules the hospital stood to lose £2.5m on readmissions, compared with £1.6m from reduced prices. This would push the efficiency saving the foundation needed to make from 5 per cent to 6.5 per cent and require a “significant reduction” in posts.
Ms Tomkinson said there were “discussions” in some parts of the North West about how the rules should apply in cases where GPs had patients readmitted.
A finance source at a £700m-turnover teaching hospital in the midlands told HSJ the readmissions policy could cost the trust £8m, if it did nothing to reduce the impact.
The finance director of a smaller foundation trust said the readmission policy was overly “harsh” and warned there would be “a lot of arbitration” with commissioners.
It comes a week after an NHS Confederation report warned trusts could lose around £790m in total next year from the changes to readmission payment policy and that costs “could be too large for some organisations to manage”.
Most hospitals that spoke to HSJ said modelling of the price changes suggested an income loss close to the DH’s planned 1.5 per cent, with some significant exceptions.
One strategic health authority source, who declined to be identified, said it estimated the loss to providers across its region would be just 0.75 per cent.
Some specialist hospitals could face disproportionate losses, as cuts to particular services will not be compensated by increases to others. Birmingham Women’s Foundation Trust director of finance and information Jason Burn said its modelling showed a loss of more than £1m of its £85m turnover from maternity tariff cuts.
Providers in London saw large variations in what they were paid under the market forces factor, which compensates trusts operating in expensive areas.
HSJ understands one London teaching trust will see a 2 per cent gain in tariff payments while another will lose 1.8 per cent.
One London commissioning group has calculated each of its primary care trusts will pay £2.7m less in tariff to its three main providers under the new arrangements.
Moorfields Eye Hospital Foundation Trust said the market forces factor would deliver a 2 per cent loss, while it generated a 2 per cent gain at another London specialist hospital.