NHS debt hits £1.2bn as patients face more service cuts
Front-line services for patients will have to be cut after it emerged last week that hospitals and GP surgeries are on course to run up a £1.2 billion deficit this year. Senior Whitehall officials admitted that operations and other services at many high-performing trusts may have to be axed this year so they can save money and build up surpluses.
These surpluses will be used to "cancel out" the deficits run up by other trusts, an accounting exercise to help strategic health authorities balance the books in their area.
The warning came as a new Department of Health report revealed the number of trusts forecasting a deficit has risen by nearly 50 per cent in the past three months.
Despite record funding for the health service, there has also been a "significant deterioration" in the overall finances of trusts in five of England's 10 strategic health authorities.
Emergency "turnaround" teams have now been sent into 143 trusts facing the worst problems. The situation is so bad that a total of 210 trusts are not even able to balance their books month-by-month.
The findings are a big blow for Patricia Hewitt, the Health Secretary, who promised the Commons in June that NHS finances would be back in balance by the end of this current financial year. Her pledge came after trusts ran up a £1.3 billion deficit last year.
Her optimism was boosted by figures published three months ago that predicted the NHS as a whole would end the year £18 million in the black, once the deficits in some trusts are balanced against surpluses in others.
But the latest figures, which cover the first half of the financial year, are now forecasting that the NHS will end up £94 million in the red.
However, these figures disguise the huge crisis in front-line services because they include surpluses of more than £0.5 billion run up by strategic health authorities, as well as a £350 million national contingency fund.
If these figures are stripped away, the NHS trusts which run hospitals and GP clinics across England will end the year £1.18 billion in the red. Three months ago ministers were predicting this figure would only be £883 million.
The number of trusts now forecasting they will end the year in deficit has risen from 120 to 175 over the past three months. Ministers hope recent cuts in the price of generic drugs may help to ease the pressure. But they admit that the introduction of age discrimination laws could add £70 million to the health service's bill for redundancies.
Miss Hewitt is still determined to balance the books by the end of the year and a senior official said yesterday that the best-performing trusts would have to make sacrifices to balance the deficits run up by other hospitals in their region.
This will involve well-managed hospitals being told they cannot spend all of their budgets this year or being forced to cut some services in order to deliver a surplus that will help their strategic health authority balance the books.
In some cases, officials admitted that trusts might even have to go into deficit to deliver the surpluses required.
Despite the bleak outlook, David Nicholson, the NHS chief executive, said he believed the health service was on track to break even this year.
Opposition politicians have voiced alarm at the worsening situation. Stephen O'Brien, the shadow health minister, said: "Despite all their warm words and promises, not to mention extra millions spent on turnaround consultants, Labour are failing to solve the NHS cash crisis."
http://www.telegraph.co.uk/news/main.jhtml?xml=/news/2006/11/10/nhospital10.xml
The fact that the NHS continues to lurch from one financial crisis to another shouldn't be a surprise to anyone who read Health Direct's posting on 30 Oct 06- PbR Payment by Results are fundamentally flawed says coding chief when we pointed out that the current system of Payment by Results (PbR) is 'fundamentally flawed and unacceptable'.
The head of the Professional Association of Clinical Coders Managing director Sue Eve-Jones told a conference that the NHS was 'doing the best we can with a fundamentally flawed and unacceptable system'.
These surpluses will be used to "cancel out" the deficits run up by other trusts, an accounting exercise to help strategic health authorities balance the books in their area.
The warning came as a new Department of Health report revealed the number of trusts forecasting a deficit has risen by nearly 50 per cent in the past three months.
Despite record funding for the health service, there has also been a "significant deterioration" in the overall finances of trusts in five of England's 10 strategic health authorities.
Emergency "turnaround" teams have now been sent into 143 trusts facing the worst problems. The situation is so bad that a total of 210 trusts are not even able to balance their books month-by-month.
The findings are a big blow for Patricia Hewitt, the Health Secretary, who promised the Commons in June that NHS finances would be back in balance by the end of this current financial year. Her pledge came after trusts ran up a £1.3 billion deficit last year.
Her optimism was boosted by figures published three months ago that predicted the NHS as a whole would end the year £18 million in the black, once the deficits in some trusts are balanced against surpluses in others.
But the latest figures, which cover the first half of the financial year, are now forecasting that the NHS will end up £94 million in the red.
However, these figures disguise the huge crisis in front-line services because they include surpluses of more than £0.5 billion run up by strategic health authorities, as well as a £350 million national contingency fund.
If these figures are stripped away, the NHS trusts which run hospitals and GP clinics across England will end the year £1.18 billion in the red. Three months ago ministers were predicting this figure would only be £883 million.
The number of trusts now forecasting they will end the year in deficit has risen from 120 to 175 over the past three months. Ministers hope recent cuts in the price of generic drugs may help to ease the pressure. But they admit that the introduction of age discrimination laws could add £70 million to the health service's bill for redundancies.
Miss Hewitt is still determined to balance the books by the end of the year and a senior official said yesterday that the best-performing trusts would have to make sacrifices to balance the deficits run up by other hospitals in their region.
This will involve well-managed hospitals being told they cannot spend all of their budgets this year or being forced to cut some services in order to deliver a surplus that will help their strategic health authority balance the books.
In some cases, officials admitted that trusts might even have to go into deficit to deliver the surpluses required.
Despite the bleak outlook, David Nicholson, the NHS chief executive, said he believed the health service was on track to break even this year.
Opposition politicians have voiced alarm at the worsening situation. Stephen O'Brien, the shadow health minister, said: "Despite all their warm words and promises, not to mention extra millions spent on turnaround consultants, Labour are failing to solve the NHS cash crisis."
http://www.telegraph.co.uk/news/main.jhtml?xml=/news/2006/11/10/nhospital10.xml
The fact that the NHS continues to lurch from one financial crisis to another shouldn't be a surprise to anyone who read Health Direct's posting on 30 Oct 06- PbR Payment by Results are fundamentally flawed says coding chief when we pointed out that the current system of Payment by Results (PbR) is 'fundamentally flawed and unacceptable'.
The head of the Professional Association of Clinical Coders Managing director Sue Eve-Jones told a conference that the NHS was 'doing the best we can with a fundamentally flawed and unacceptable system'.
posted by Dr Search- Principal Consultant at the Search Clinic at
9:34 AM
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