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Acute overspending raises questions over PCT plans

Primary care trusts have overspent against acute contracts by hundreds of millions of pounds, raising questions over the success of efforts to deliver care more cheaply in the community.

The average overspend figure for PCTs contacted by HSJ this week was £7.6m, suggesting that nationally the total could be as much as £1.2bn.

HSJ asked a cross-section of 20 PCTs across all strategic health authority areas in England how they had performed against what they had planned in their 2008-09 acute contracts.

Commissioners have been warning of pressure on acute contracts since a spike in referrals by GPs began to drive up hospital activity last year.

PCTs are covering the extra costs using their surpluses or by dipping into next year’s funds.

At the start of March, Warrington PCT predicted in its board papers that its surplus would be half what it had envisaged at the beginning of 2008-09. The acute overspend is listed as a contributing factor.

Some have taken money earmarked in development plans for other areas of care to cover the shortfalls.

PCT leaders attributed the overspend to pressure to achieve the 18-week referral to treatment target, the increase in GP referrals and the bad winter weather increasing hospital activity.

But they also acknowledged that some commissioners had been optimistic when predicting how much money they could save from acute contracts by moving services into community settings.

Shifting treatment out of hospitals in order to provide care more economically was a cornerstone of the 2006 Our Health, Our Care, Our Say white paper.

PCT Network director David Stout said: “Therne has been a history of slightly optimistic demand management assumptions. PCTs need to avoid making optimistic assumptions about demand and capacity, unless they’ve got very worked-through plans about how they are going to [manage demand] that they are confident are deliverable.”

Mr Stout said PCTs needed to understand why the overspend was so high this year, including assessing whether assumptions that demand would go down in certain specialties had been too optimistic.

Birmingham East and North PCT chief operating officer Andrew Donald said shifting more services into primary care would bring returns, but PCTs must monitor activity “forensically” to make sure they were achieving the savings they had planned for.

He said: “You’ve got to have done the detailed business case and understand the consequences in terms of what you’re trying to do in primary care and model cause and effect.

“If it’s not delivering, you’ve got to be brave enough to stop it and say let’s do something else.

“It relies on PCTs measuring outcomes and the impact of what they are doing, which hasn’t been a strong point.”

Mr Donald predicted pressure to stay on top of spending would increase as budgets were squeezed in coming years.

King’s Fund deputy policy director Candace Imison suggested that shorter waiting times could have introduced an element of “supply induced demand”.

The “painfully” slow progress of practice based commissioning was also likely to be a factor in delays in providing more community based services, she said.

PCTs should be more proactive in tracking patients as they moved through the health service and in assessing the effectiveness of treatment.

She urged PCTs to study choose and book data to find out who was using alternative services and what was happening to them afterwards – for instance whether they were ending up in hospital following treatment in the community.

She said: “Maybe they have created services outside of hospital but they haven’t reduced acute activity and have supplemented acute care rather than replacing it.”

From:
http://www.hsj.co.uk/5000506.article

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