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Welfare Reform on the Web (December 2007): National Health Service - funding

Banks threaten to hit FTs with rate hike over debt guarantees

S. Gainsbury

Health Service Journal, vol. 117, Nov. 15th 2007, p. 5

Reports that banks have threatened to hike up the interest rates they charge foundation trusts in the absence of a guarantee that the government will underwrite their debts in case of insolvency. Theoretically foundation trusts are autonomous organisations and their debts are therefore not underwritten by the government.

District general hospitals face heavy specialist service losses

S. Gainsbury

Health Service Journal, vol. 117, Nov. 8th 2007, p. 5

The Department of Health is developing a new 'top-up' system in which hospitals performing certain specialist procedures will receive a premium over the payment by results tariff to ensure their full costs are met. A number of district general hospitals that perform specialist procedures have been told they will be excluded from the list of providers eligible for top-up. This move could drive the centralisation of specialist services in regional centres.

Embarrassment for the DoH as NHS underspends by 1.8bn

S. Gainsbury

Health Service Journal, vol. 117, Nov. 2nd 2007, p. 5

Reports that the NHS is heading for a record 1.8bn underspend in financial year 2007/08. The total surplus will be almost 2% of the NHS budget. This large underspend is causing embarrassment at the Department of Health, which fears that it will be accused of presiding over a 'boom and bust' health economy.

Managing to manage healthcare resources in the English NHS? What can health economics teach? What can health economics learn?

A. Bate, C. Donaldson and M.J. Murtagh

Health Policy, vol. 84, 2007, p. 249-261

This study explores the potential for using economic frameworks to inform prioritisation decisions in the English NHS. Interviews with 22 key decision makers from six primary care trusts in Northern England showed that they recognised the concepts of resources scarcity, competing claims and the need for choices and trade-offs to be made. However, in practice commissioning decisions were influenced by political, historical and clinical considerations and failed to put these concepts into practice.

PFI debt fears as district generals feel the squeeze

S. Gainsbury

Health Service Journal, vol. 117, Nov. 15th 2007, p. 16-17

District general hospitals are coming under financial pressure due to their higher value work being migrated to specialist regional centres and their high-volume, routine elective surgery being transferred to independent treatment centres. Additionally, primary care trusts are moving outpatient and diagnostic work to GP surgeries. PFI (public finance initiative) schemes compound the problems facing hospitals with reduced incomes. The payment by results tariff assumes that 5.8% of a hospital's income needs to be spent on buildings and infrastructure, but many PFI debt repayments are much higher than this.

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