Monday, October 29, 2012

Your NHS: Please don't cry!

It is a common practice for politicians to ignore professional advice. Sometimes they might get away with it; sometimes it led to failure, gross failure as in the case of the French attempt at building the Panama Canal.

So, please don’t cry!
© Am Ang Zhang 2012

Lith Style Photographic work.

The Independent: 

A bankrupt NHS trust with three acute hospitals that serve a million people in London looks set to be carved up between the NHS and private sector, according to controversial proposals revealed today.

South London NHS Healthcare Trust was declared bust and administrators called in three months ago after haemorrhaging around £1m a week to accumulate debts of £150m.

Its three hospitals in south-east London - Queen Mary's in Sidcup, Princess Royal (PRU) in Bromley and Queen Elizabeth (QEH) in Greenwich - have struggled with patient satisfaction and spiralling debt since they were merged into a super-Trust in 2009.

Matthew Kershaw was dispatched to take-over in July by the former Health Secretary, Andrew Lansley, after it became clear that its two hugely expensive private finance initiative (PFI) deals meant the status quo was impossible for the taxpayer to sustain.

Mr Kershaw’s radical proposals, which inevitably have a knock-on effect for neighbouring hospitals, include the merger of the PFI built QEH with neighbouring Lewisham Healthcare NHS Trust with the loss of one A&E department. The PRU could be taken over by King’s College Hospital NHS Foundation Trust or more controversially, its services put out to tender - keeping alive hopes of several private companies hoping for a slice of the franchise.


Keith Palmer earlier produced a detailed report:

…………competition and choice in contestable services may inadvertently cause deterioration in the quality of essential services provided by financially challenged trusts.

Market forces alone will rarely drive trusts into voluntary agreement to reconfigure services in ways that will improve the quality of patient care as well as drive down costs. In many cases the most likely outcome will be continued deterioration in both the quality of care and the financial position. The NHS will  have no alternative but to continue to fund their deficits or allow them to fail.  


The NHS is entering a period of unprecedented financial challenges that will result in major changes to the provision of health services. While all areas of health care will be affected, acute hospitals face particular challenges because of the high proportion of the NHS budget spent in hospitals. Add in the need to reconfigure specialist services in many parts of the country to deliver improvements in outcomes and the requirement that all NHS trusts should become foundation trusts by 2014, and a period of fundamental service and organisational change is in prospect.

Keith Palmer’s analysis of the reconfiguration of acute hospital services in south-east London offers a timely and sobering contribution to the emerging debate on how service and organisational change should be taken forward across the NHS in England. His painstaking account of the trials and tribulations of bringing together four acute hospital trusts with a history of financial problems, the challenge of funding large and long-term private finance initiative (PFI) commitments and difficulties in sustaining high-quality specialist care in hospitals in close proximity to each other offers important learning for the future.

Three major implications for policy-makers stand out.

First, Palmer argues that market forces are unlikely to deliver desirable service reconfiguration, and only ‘strong commissioning’ stands a chance of bringing about the changes needed to improve quality and drive down costs. As he shows, in the case of south-east London, primary care trusts (PCTs) were either unwilling or unable to intervene to tackle the challenges facing acute hospitals, and only when the strategic health authority (SHA) became involved was some progress made. General practice commissioners face formidable obstacles in being more effective than PCTs in leading complex service reconfigurations, raising questions as to where responsibility for taking forward this work will rest when SHAs are abolished.

Second, Palmer questions the strategy of merging acute hospitals providing broadly similar services. His preferred alternative is to support acquisitions of financially challenged NHS trusts by high-performing foundation trusts on the grounds that this will facilitate improvements in quality and outcomes through the accelerated adoption of best practice models of care. Although provider consolidation along these lines might reduce competition in the health care market, the consequences have to be weighed against the risk that quality will deteriorate if Monitor in its role as the economic regulator rules against such acquisitions. The implication is that organisational changes need to be based on a thorough assessment of how to bring about improvements in quality, particularly through organisations that perform well lending support to those that are challenged.

Third, Palmer contends that the government will need to find a way of dealing with legacy debt andthe costs of PFI commitments to support the acquisition of financially challenged trusts. Neither high-performing foundation trusts nor private sector providers are likely to be willing to take on challenged trusts without such support, and competition law requires that all parties should be treated equally if a market in acquisitions opens up. At a time of public spending constraint it will not be easy to identify additional resources but failure to do so may simply increase the financial and service challenges facing the NHS and store up even greater problems in future. The lessons from this paper need to be acted on in a context in which ministers have emphasised that service reconfigurations should be based on support from general practice commissioners and public and patient involvement. They have also argued that service changes should be consistent with clinical evidence and help to facilitate patient choice. The government’s decision to bring a halt to the work being undertaken by Healthcare for London to concentrate some specialist services to improve outcomes underlines the challenges in acting on the evidence presented in this paper.

In reality, the requirement to find up to £20 billion of efficiency savings by 2015 and to establish all NHS trusts as foundation trusts by 2014 will necessitate a stronger approach to commissioning than currently envisaged to ensure that quality is improved at the same time as costs are brought under control. The expertise of general practice commissioners needs to be married with the ability to lead complex service reconfigurations across large populations if the lessons from south-east London are to have lasting impact.

Chris Ham
Chief Executive
The King’s Fund

Read the full summary here>>>>>
Read the full pdf report here>>>>>


First Emperor, Animal Farm & Allyson Pollock



"Since it was Pollock's views on the PFI that so upset its proponents, it is worth summarising them briefly. Costs are now intrinsically higher, because of capital borrowing at higher rates than those available to government, because of cash hungry consultancies and the vast transactional and monitoring costs of countless contracts, and because—for the first time on a large scale in the NHS—commercial profits must be made. To accommodate all these new costs clinical services have been scaled down, while matching assumptions about increased efficiency are only variably delivered. All this, along with the rigidity of a trust based strategy for building hospitals and the locking in effect of contracts fixed for decades, seems to Pollock and many others at best a bad bargain, at worst a naive betrayal that opens the NHS to piecemeal destruction and the eventual abandonment of its founding principles. And all over the country PFIs—greedy, noisy, alien cuckoos in the NHS nest—gobble up its finances and will do so for the next 30 years.”

Next 30 years!

Latest from Allyson Pollock.




Ernst & Young was paid £33m for handling the administration of Metronet, the company which left the maintenance of two thirds of the London Underground in limbo when it collapsed.

The failure cost the taxpayer up to £410m, the National Audit Office also disclosed in a highly-critical report released today.

'The taxpayer has borne some of the direct costs of Metronet’s failure, including the unexpected upfront payment of £1.7bn. We estimate there has been a direct loss to the taxpayer of between £170m and £410m,' the NAO said.

The government had to shell out the £1.7bn to cover Metronet's debt obligations to its lenders, which would have been paid back over the course of the 30-year contract if the company had not collapsed.


2 comments:

Julie said...

Jesus wept. So did I. This was set up to fail.

Cockroach Catcher said...

Hold your tears. More happening soon!