Only 10 trusts have made use of rules introduced under the government’s health reforms to seek permission to raise their prices above national ‘tariff’ rates - and most of those applications have been rejected.
Under the Health Act 2012, struggling providers can apply directly to the regulator Monitor for price increases where they believe it is not possible to cover their costs of providing specific services at national NHS prices.
However, HSJ has learned that only a small number of NHS providers have bid for such price hikes in 2014-15, despite a significant proportion of the sector expecting to finish the year in deficit.
A Monitor spokesman told HSJ that 10 trusts had applied for “local price modifications” for the current financial year. Six applications had been rejected.
Two of the remaining submissions were later withdrawn by the applicant trusts, meaning that only two applications are currently being considered by Monitor.
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The regulator declined to comment on why the number of applications had been so low, but said it would “publish an evaluation of its work on local modifications later this year”.
It has also declined to give details of which providers had applied for price hikes or why, on the grounds that it would not be fair to “those providers who had a reasonable expectation that their requests would be subject to commercial confidentiality”.
This year’s tariff rules only require Monitor to publish details of local modifications that have been approved. However, the regulator said that following recent consultation it planned from April 2015 to publish details of all its decisions on the modifications, including where they have been rejected.
To date, only one trust is known to have publicly expressed an intention to bid for price rises. This was University Hospitals of Morecambe Bay Foundation Trust, which this summer asked its commissioners to increase its prices by more than £17m, arguing that its remote and dispersed population led to additional costs.
However, HSJ understands that Monitor has not yet received an application from Morecambe Bay.