The head of a respected foundation trust has called for a major overhaul of financial rules to help popular hospitals cope with the extra demand their reputations attract.

The chief executive of University Hospitals Birmingham Foundation Trust, Dame Julie Moore, told HSJ that well regarded hospitals were financially disadvantaged because increased demand was not matched by additional funding.

She said the Care Quality Commission’s drive to highlight poor care had not fed through into changes in funding rules.


Dame Julie Moore said: ‘If one hospital is deemed a failure, patients flow over the boundaries’

“If one hospital is deemed as a failure and that gets well publicised, then there’s a flow of patients over boundaries,” Dame Julie added.

“We have seen a huge influx of patients from all around us in Birmingham.

“[CQC chief executive] David Behan has talked about the Care Quality Commission enabling people to choose, which is right… but it’s not right when the money no longer follows the patient.”

Dame Julie said the trust had previously been paid “over the odds” by NHS commissioners that wanted patients from outside the hospital’s catchment area treated in Birmingham.

“Now it’s at flat tariff so you can’t do that,” she added.

Dame Julie said the trust has seen a huge increase in demand from outside the city.

The number of patients coming from beyond the city to attend its accident and emergency department had shot up 36 per cent compared with a 3 per cent rise for patients living in the city, she explained.

The trust’s Queen Elizabeth Hospital site, which had originally intended to house 1,013 beds, was now accommodating 1,450 beds, she told HSJ.

“We’ve opened the equivalent of a couple of district general hospitals to cope with the increase over the past two to three years. That is a huge increase in a short period of time”, she said.

“I don’t see how you can have choice as a policy existing alongside a reduced tariff policy. What it’s going to do is cripple hospitals with a good reputation.”

Dame Julie said it was unclear whether the NHS was operating under the principles of the market or a “managed system”.

“There’s a huge argument about is health a market or is it not.

“At the moment we’ve got half a market and half a managed system and it seems to be the worst of both worlds.”

“In normal business, if you were very popular, money would follow footfall and then you could open another branch.

“At the moment, the way the financial rules operate and the way you have not got certain income for the next few years, it’s almost impossible to do that.”

Dame Julie’s call for a shake-up of the funding rules comes after the trust closed its doors to out of area referrals, a move that has sparked concerns among local MPs and ministers.

High profile trust chief calls for funding overhaul