Hewitt calls for hospitals to close- despite record funds

A swathe of hospital closures and reconfigurations was signalled by Patricia Hewitt as a necessary step to get the National Health Service back into financial balance. The health secretary's admission that big changes would be needed in the way services were delivered in some parts of the country came as she announced she was sending "turnaround teams" into the 18 NHS organisations facing the greatest financial risks.

But she added that some "very difficult" decisions would be needed in parts of the NHS where "too many services are being delivered from too many different places in a way that is very expensive and very inefficient".

This would mean "reorganising services, reconfiguring hospitals, doing more treatment and diagnostics in the community, in primary care centres and community hospitals".

Two separate surveys yesterday showed more than three-quarters of NHS chief executives saying that the areas with the worst financial problems could not solve them without the redesign and closure of services.

The NHS Confederation, which represents health authorities and trusts, said this left the government facing "a stark choice between continuing financial instability and tough political decisions", even before the implementation of its more radical policies. These in-cluded giving patients a choice of hospitals and "payment by results", in which hospitals were paid for the number of patients they treated, not through service level contracts.

Ms Hewitt acknowledged that politicians would have to argue the case. Changing medical technology and redesigned services would produce better patient care, and the service could not "do everything, or as much as we are currently doing, in acute hospitals", she said.

Three-quarters of the NHS is in financial balance. But Ms Hewitt's admission points to a controversial series of rationalisations, reconfigurations and possibly the closure of some hospitals in Sussex and Surrey, west London, the home counties to the north in Hertfordshire, and in parts of Hampshire, Kent, Lancashire and Yorkshire and possibly in Wiltshire. These are all areas where there are structural underlying deficits as well as current overspends.

Few hospitals are likely to close. But many more could lose accident and emergency departments and the full range of procedures as services are concentrated on fewer sites and in some cases moved out of the hospital entirely. Despite admitting the need for serious structural change in some areas, Ms Hewitt confirmed she was further extending the "payment by results" system, which is currently used for waiting list cases.

This will mean the system is applied to accident and emergency, urgent operations and outpatients. Officials said for a typical district general hospital that would mean about 60 per cent of its income would depend on levels of activity, not on block contracts.

Ms Hewitt insisted that "payment by results" was not causing the NHS's financial problems, but making them transparent. Some hospitals and areas had failed to redesign activity to get best value and match finances, she said, in effect borrowing from others for years. This practice had to stop.

Dr Gill Morgan, chief executive of the NHS Confederation, said politicians needed the courage to let managers "take difficult decisions that will benefit patients in the long term". This meant getting away from a fixation with hospital buildings and focusing instead on the services delivered. "Loss of beds does not necessarily equate to a decline in services."

Dr Morgan called for historic debts to be restructured. However, Department of Health finance officials said debts would have to be cleared, not written off.

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