John Hemming's Web Log John's Reference Website
Friday, March 17, 2006
  NHS Cash Crisis 'won't hit patients' !?!
Pull the other one.

The problem is that they are doing too many things at once. They are trying to handle a financial crisis, introducing completely new financial rules, reorganising the commissioners of most of the services (64.309 bn of about 69).

There will be costs from the reorganisation not savings. If they were serious about managing the service in a proper manner they would:

a) Stop the PCT reorganisation apart from those where there is a local call for reorganisation.
b) Either reverse the removal of PPA or change the tariff system for PbR.
c) Stop moving as much funding outside the NHS.

There are substantial costs to reorganisations. Redundancies cost money. Changing things in the public sector is, therefore, something that takes planning.

I think they will be forced to remove PbR to some extent as it is being used to ratchet up the costs.

There are good arguments for transactional payments, but there is no financial leeway in the system to cope with the consequences.

If an NHS organisation other than a Foundation Trust cannot pay its way then the NHS and Department of Health remains liable. The saga in Woolwich where the hospital has stopped paying its tax bill shows the difficulties. It will have to be paid at some stage.

There is also a tendency to slush money around the health economy. This is a zero net sum process whereby deficits merely get moved around.
 
Comments:
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