Trusts ask Monitor for tariff hike

HSJ has obtained a list of providers, which includes Lewisham and Greenwich Trust and Worcester Acute Hospitals, that have applied to Monitor for a price increase during the current financial year.

There were another eight requests for an uplift in 2014-15, including from Oxford University Hospitals Foundation Trust.

Monitor can enforce an LPM when it judges that the national prices paid to a trust by local commissioners should be increased. They are diffierent from local ”variations”, which are more common and are agreed locally.

Last July, the regulator announced it had used these powers for the first time in relation to University Hospitals of Morecambe Bay Foundation Trust. The move should boost the trust’s annual income by about £25m, to cover the increased costs of running several sites in rural locations.

UHMB had initially tried to strike a deal with commissioners, but took the case to Monitor when this failed. No further cases have been announced.

In response to a Freedom of Information request from HSJ, Monitor released the following list of trusts that have applied for an LPM in the last two years. It refused to state the reasons for applications being refused.

The financially troubled Worcestershire Acute Trust withdrew its application but intends to resubmit after “further engagement” with its commissioners.

A spokesman said its maternity, paediatric inpatient, and outpatient services are provided at a “significant loss” due to being on multiple sites and the heavy reliance on locum and agency staff.

He added: “It is the trust’s view that maternity and paediatric services should be subject to a formal local price modification until structural change can be implemented to deliver services that are sustainable long-term.”

The trust has estimated the “annual gap” for these services at £8.4m, although its commissioners have been paying a “local top-up payment” of £2.6m towards this.

University Hospitals of the North Midlands Trust said its unsuccessful application related to the takeover of Mid-Staffordshire FT in 2014, and would have been worth about £2m per year.

North Cumbria said its rural geography makes it a similar case to UHMB, but it decided not to proceed with the application after being included in a “success regime”.

Weston Area Trust, which has so far been unsuccessful with two applications, declined to explain the reasons for its request. North Bristol Trust also refused to explain the reasons for its unsuccessful bid, saying it was submitted by commissioners.

Oxford University Hospitals FT, Plymouth Hospitals Trust, Lewisham and Greenwich Trust, Royal Marsden FT, and United Lincolnshire Hospitals Trust did not respond.

The requests from Royal Brompton and Harefield FT and Derby Teaching Hospitals FT related to specialised services, which are commissioned nationally.

RBHFT’s request related to critical care and aortic surgery which would have been worth £13m per year. It said the application was due to the loss of Project Diamond funding, but was “refused before submission on grounds that you cannot apply without having a total deficit of more than 2 per cent”.

Derby’s related to spinal surgery, and was successful in securing an uplift of about £200,000.

NHS England has introduced a new “sparsity adjustment” to next year’s clinical commissioning group allocations, which it says affects eight hospital sites. This may make it more difficult to secure an LPM on the basis of multiple site in rural locations.