Today’s autumn statement painted a gloomy picture of the economy in 2012. By the time the Chancellor rose, NHS leaders had already begun to come to terms with an operating framework that sent a similarly grim message.
Like George Osborne, NHS chief executive Sir David Nicholson intends to bear down hard and fast on financial problems in the hope of creating a more sustainable environment. In doing so he takes the calculated risk of destabilising sections of the English health economy.
Many predicted an easing of financial pressures in light of the pain being felt. Not a bit of it. The framework was characterised by things that did not happen. There was no change on the efficiency requirement or the command to wipe out primary care trust deficits by April 2013. Nor have commissioners been discouraged from enforcing the penalties designed to cut emergency admissions and readmissions. Just the opposite, they have been instructed to get tough and to institute a new fine for poor quality data for good measure.
The “cherry picking” clause designed to control unjustified profit on simple procedures will impact upon NHS as well as private providers and is unlikely to be counter balanced by best practice tariffs designed to properly reward work. The two per cent top slicing of commissioners’ allocations to fund service change (or bail out failing organisations) will continue.
The Department of Health intends to break the back of the £20bn quality, innovation, productivity and prevention savings challenge in 2012-13, knowing that failing to do so would leave too much to do within their declared timeframe.
Those hoping rules around choice and payment by results would be relaxed to facilitate integrated working were similarly disappointed. Commissioners will now have to explain if and why they are not following choice rules. Sir David’s deputy, David Flory, said payment by results was “absolutely not” being rolled back and announced ambulance services were to be moved onto tariff.
This will increase tensions between the DH and those commissioners and providers who have been quietly moving an increasing proportion of work away from PbR.
Of course, none of this ratcheting pressure means any easing off on performance demands. National waiting list management is back, as is a focus on the care of older people. The Mid Staffordshire Foundation Trust inquiry is likely to deliver a further set of requirements, while the need and desire to produce innovative service change will persist.
This is the most demanding set of marching instructions ever set out in an operating framework. Before its publication one foundation trust finance director told us: “It is starting to feel unreal for even the best trusts”.
Many trusts are now desperately searching for a solution to the apparently impossible position they find themselves in.
The option de jour is to seek merger – and the large number of non-FTs seeking a partner to enable them to enter the authorisation pipeline will soon be joined by a significant number of foundations seeking supposed economies of scale. This will, of course, spit out more service reconfigurations – some controversial.
HSJ will not insult its readers by endorsing some of the “one leap and we’re free” solutions to the problems facing the service. The possibility of a cash injection is far-fetched and the reorganisation of the commissioning and intermediary tiers is so well advanced that the advantage of halting it would be very limited.
The best hope is that government, the media and the public recognise the fearsome task the local leadership of the NHS has been given in 2012-13. HSJ will live in hope, but avoid holding its breath.