‘Buddy’ trusts could double their money under bonus scheme

HSJ has also learned that some buddies are on track to double their money after helping ailing trusts leave special measures.

Even with the bonus payments, senior figures claim the regime is better value for money than management consultants.

Nine of the 11 acute hospitals placed into special measures following last year’s Keogh review of hospitals with high mortality rates were buddied with more successful organisations to help them improve.

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Monitor’s annual accounts, published last week, reveal £742,000 was paid out in “special measures reimbursements” to cover the costs of the five foundation trust buddies, equivalent to an average of £148,400 per buddying arrangement.

The NHS Trust Development Authority’s annual accounts record £871,000 of expenditure on special measures during 2013-14. Some of this was spent on other support for special measures trusts, making the average payment to buddy trusts closer to £150,000. Actual payments are likely to vary significantly according to levels of support and start times.

The payments compare favourably with amounts typically charged by consultancy firms often brought in to support struggling organisations.

Monitor told HSJ that organisations buddying with foundation trusts could receive up to 100 per cent of their costs as an additional payment under an incentive scheme which uses a sliding scale of bonus payments (see box). The TDA said it was still developing an approach to incentives.

One senior hospital source with knowledge of special measures arrangement described the payments as “pretty good value”, adding: “It’s probably about 10 per cent of what the big four [consultancy firms] would have cost and it keeps the funds in the NHS.

“Trusts much prefer working with people who understand what they’re doing and are from within the system.”

Sir David Dalton, chief executive of Salford Royal Foundation Trust, which has buddied with Buckinghamshire Healthcare Trust and East Lancashire Hospitals Trust, told HSJ: “Having a track record of comparative success means we are more likely than a management consultancy to understand what needs to be done.”

The payments compare favourably with amounts typically charged by consultancy firms often bought in to support struggling organisations.

Salford Royal Foundation Trust has buddied with Buckinghamshire Healthcare Trust and East Lancashire Hospitals Trust.

Chief executive Sir David Dalton said the main cost they had been reimbursed for was backfilling the time of senior staff who went to spend time at the special measures trust.

He said: “Having an organisation that has a track record of comparative success means that we are more likely than a management consultancy to understand what it is that needs to be done in terms of improvement and we have our own proven methods.

“Often with consultancy support, which there is a place for, it’s doing the diagnostic work but may not always be there to support the implementation.”