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Report exposes NHS England’s failures on managing specialised services Report exposes NHS England’s failures on managing specialised services
(4 months later)
The National Audit Office has exposed another NHS organisation for system-wide failures – poor financial controls, disjointed services, incomplete data and staff with the wrong skills. The culprit is NHS England and its commissioning of specialised services (pdf).The National Audit Office has exposed another NHS organisation for system-wide failures – poor financial controls, disjointed services, incomplete data and staff with the wrong skills. The culprit is NHS England and its commissioning of specialised services (pdf).
Specialised services are huge business for the NHS, consuming almost £15bn last year – about 14% of the total NHS budget – and slated for 7% growth in 2016-17. Around 300 health organisations provide at least one specialised service, which cover everything from specific mental health problems to chemotherapy.Specialised services are huge business for the NHS, consuming almost £15bn last year – about 14% of the total NHS budget – and slated for 7% growth in 2016-17. Around 300 health organisations provide at least one specialised service, which cover everything from specific mental health problems to chemotherapy.
The ability of NHS England to manage this budget is crucial – if it cannot control the costs, it will impede the adoption of new treatments and technologies while sucking yet more money into the hospital sector.The ability of NHS England to manage this budget is crucial – if it cannot control the costs, it will impede the adoption of new treatments and technologies while sucking yet more money into the hospital sector.
NHS England took control of specialised service commissioning from the strategic health authorities in 2013. For trusts struggling to maintain staff numbers it may come as a shock to find in the NAO report that the number of NHS England full-time equivalent staff involved in commissioning specialised services has jumped from 287 to 489 in just two years, taking costs from £20m to £38m.NHS England took control of specialised service commissioning from the strategic health authorities in 2013. For trusts struggling to maintain staff numbers it may come as a shock to find in the NAO report that the number of NHS England full-time equivalent staff involved in commissioning specialised services has jumped from 287 to 489 in just two years, taking costs from £20m to £38m.
Related: There is little hope that the NHS can avoid a financial crash
But NHS England’s record on managing the specialised services commissioning budget is awful. Its overspend in three years amounts to around £700m. Management was undermined from the start by poor data, while it has been faced with demand rising even faster than for other NHS services. High-cost drugs and devices – often for previously untreatable conditions – keep being added to the portfolio.But NHS England’s record on managing the specialised services commissioning budget is awful. Its overspend in three years amounts to around £700m. Management was undermined from the start by poor data, while it has been faced with demand rising even faster than for other NHS services. High-cost drugs and devices – often for previously untreatable conditions – keep being added to the portfolio.
Last year, for example, around £191m was used to pay for new drugs to treat hepatitis C. Crucially, while the National Institute for Health and Care Excellence considers cost-effectiveness, it does not consider whether the NHS can afford a new treatment. NHS England does have discretion over whether to fund a new drug, but the political pressure to provide new life-saving treatments is often overwhelming.Last year, for example, around £191m was used to pay for new drugs to treat hepatitis C. Crucially, while the National Institute for Health and Care Excellence considers cost-effectiveness, it does not consider whether the NHS can afford a new treatment. NHS England does have discretion over whether to fund a new drug, but the political pressure to provide new life-saving treatments is often overwhelming.
NHS England and Monitor have attempted to control these costs by squeezing the tariff paid to trusts for them, partly in an attempt to control demand by removing the incentive to generate more cash by increasing activity. But demand has continued to climb. According to evidence supplied to the NAO, around 89% of acute trusts say the money does not cover their costs.NHS England and Monitor have attempted to control these costs by squeezing the tariff paid to trusts for them, partly in an attempt to control demand by removing the incentive to generate more cash by increasing activity. But demand has continued to climb. According to evidence supplied to the NAO, around 89% of acute trusts say the money does not cover their costs.
The position of trusts has been undermined further by repeated failures to sign contracts on time, and overwhelmingly having deals that only last for a year. This is now being addressed.The position of trusts has been undermined further by repeated failures to sign contracts on time, and overwhelmingly having deals that only last for a year. This is now being addressed.
NHS England has had some success in negotiating better prices with commercial suppliers, but it is clear that in general trusts have low regard for the skills of the local commissioning teams. More than half of trusts believe they did not have the commercial skills to do their job.NHS England has had some success in negotiating better prices with commercial suppliers, but it is clear that in general trusts have low regard for the skills of the local commissioning teams. More than half of trusts believe they did not have the commercial skills to do their job.
The government’s accelerated access review might eventually bring down the costs of new health technologies. The review amounts to a deal with industry: we will help you get developments such as new drugs to market quicker, which will boost your national and global sales, but in return you give the NHS better prices.The government’s accelerated access review might eventually bring down the costs of new health technologies. The review amounts to a deal with industry: we will help you get developments such as new drugs to market quicker, which will boost your national and global sales, but in return you give the NHS better prices.
Related: Can new regulator NHS Improvement save the health service?
Perhaps the most worrying finding of the NAO study is that NHS England does not have a plan for specialised services.Perhaps the most worrying finding of the NAO study is that NHS England does not have a plan for specialised services.
Despite all this national control, there are still huge variations in access, quality and prices across the country, while patient outcome data is patchy so it is largely unclear whether services are improving. Predictably, patients often find their care is disjointed as they move between services commissioned locally and nationally.Despite all this national control, there are still huge variations in access, quality and prices across the country, while patient outcome data is patchy so it is largely unclear whether services are improving. Predictably, patients often find their care is disjointed as they move between services commissioned locally and nationally.
Overall, NHS England’s commissioning of specialised services has been a long way from a masterclass. Costs have massively overrun, the financial position of many trusts has been further destabilised, contract management has been weak, and it doesn’t have the right data.Overall, NHS England’s commissioning of specialised services has been a long way from a masterclass. Costs have massively overrun, the financial position of many trusts has been further destabilised, contract management has been weak, and it doesn’t have the right data.
At the heart of this, NHS England is committing precisely the same crime for which it and NHS Improvement are now bearing down on trusts – crashing through financial targets which were always unrealistic.At the heart of this, NHS England is committing precisely the same crime for which it and NHS Improvement are now bearing down on trusts – crashing through financial targets which were always unrealistic.
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