Fully Fund Our NHS. Photo: PA
NHS cash crisis reaching a turning point for the worse
We are at a turning point in the growing cash crisis of the NHS. In many areas the threat of cuts and closures could soon be a reality.
The NHS cash freeze has barely increased spending in real terms since 2010 while the population has grown and costs have risen much faster: so the scale of trust deficits has also grown, even faster than many experts feared.
My survey of 155 acute trust finance reports shows 25 have deficits over £25m – and the average deficit is almost £15m. Acute trusts deficits totalled £2.3bn by December.
In January Jeremy Hunt demanded NHS trust managers clear deficits before they receive any of the inadequate £1.8 billion ‘transformation fund’ in 2016-17. He included weasel words urging trusts to balance the books “without compromising patient care”. But he must know this can’t be done.
Hunt insisted trust boards which fail to clear deficits would be removed and replaced – although it’s far from clear how so many trusts could all be subjected to this treatment.
78 – half of all acute trusts – are showing deficits above £10 million – that’s the figure that triggered the crisis at Mid Staffordshire Hospitals Trust in the mid-2000s, where management, desperate to clear deficits, slashed numbers of nursing and medical staff – reducing services to disastrously poor levels resulting in a national scandal.
Nonetheless a letter from Monitor and the Trust Development Agency explicitly urges trusts in deficit to agree cuts including “headcount reduction” – in other words large-scale job losses.
According to King’s Fund figures cutting 25 nurses saves £1m. So by that measure the average trust would need to axe 375 nurses to balance the books that way!
But the other way to make “savings” and cut staff is to close wards, services and whole buildings.
These desperate measures could now be adopted. Three days before Christmas the Care Quality Commission, Health Education England, NICE, NHS Improvement, Public Health England and NHS England joined forces to spell out a new approach, in which trusts are now required to work with CCGs in local “footprint” areas, to draw up 1-year and 5-year “Sustainability and Transformation Plans” (STPs).
England’s NHS is being carved up into 44 STP “footprints,” each with an urgent agenda for action against a tight timetable. Even that’s not straightforward: councils are complaining they are being left out of the process.
Controversial plans for “reconfiguration” – i.e. closures of hospitals and A&E units – could be revived and driven forward in STP footprints, as the way to balance the “local health economy”. They will be resisted.
The CQC, HEE, NICE, NHS Improvement, PHE and NHS England have also published a rigorous checklist of hurdles that all trusts and CCGs have to surmount: each STP needs to be drawn up swiftly, and trusts will be required to deliver “the key must-dos” from the “list of nine must-dos” developed by NHS England.
This sounds like – and is – a load of bureaucratic hocus-pocus. No matter how you dress it up, only hefty cuts will balance the books.
Hospital trusts are not just missing financial targets, but also missing targets for treatment of A&E patients, cancer patients, waiting list patients – and massively failing mental health patients.
20 additional trusts have now been placed in a “turnaround” regime – at an estimated cost of £10m. The 30 trusts with the worst A&E performance have been summoned to a meeting in London to be hauled over the coals by regulators.
But the Tories could pay a heavy political price for their decision to reduce the NHS to a cash-strapped shadow of the service they inherited in 2010. The junior doctors’ dispute has given a clear signal to the government where public trust lies. Red ink on balance sheets might not motivate voters but closures and waiting lists do. Most of those effected are over 65 – many voted Tory in the last election.