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

Dr Foster Intelligence: a joint venture between the Information Centre and Dr Foster LLP

Committee of Public Accounts

London: TSO, 2007 (House of Commons papers, session 2006/07; HC368)

The Health and Social Care Information Centre (now renamed as the Information Centre) entered into a partnership with a private firm, Dr Foster Ltd, to set up a joint venture company to provide data on NHS performance. This was done without a competitive tender process. Moreover the Information Centre paid £12m for a 50% stake in the joint venture company, 33-53% more than its financial advisors' indicative valuation of a half share. The Committee considered reasons for establishing the joint venture without a competitive tender process, the cost of the joint venture, and the management of its risks and benefits.

The fiscal future of the NHS

C. Donaldson

National Health Executive, vol.1, May/June 2007, p. 14-15

This article reviews the question of why, despite very large increases in funding and various initiatives aimed at improving efficiency, the NHS ended up with record financial deficits in 2006. The NHS is currently disproportionately dominated by the acute sector, which is now thinking of moving into the territory of primary care. The author calls for the introduction of an approach that would aim to maximise population health within available, limited, resources. This would involve disinvesting in some services and reallocating resources. Better value for money could also be obtained through the spread of evidence-based best practice.

NHS heading for record £1bn surplus

P. Curtis

The Guardian, Aug. 31st, 2007, p.4

A government report predicts that the NHS will have a surplus of £983m by the new financial year, up from the £547m deficit in April 2006. However, health unions claim that the savings have caused a lot of 'unnecessary pain' as a result of redundancies, a below inflation pay award and services reduced.. The figures also mask regional inequalities in spending, with 22 out of 152 primary care trusts still running deficits.

NHS trusts set up deals to avoid private income caps

N. Timmins

Financial Times, Aug. 20th, 2007, p.2

NHS trusts are setting up charities in joint ventures with the private sector, which will help in administering services for fee-paying patients to boost income past the cap imposed by the government. Current legislation prevents NHS trusts from earning a higher proportion of their income from private patients. By sharing profits with private partners trusts are attempting to sidestep the legislation, something Unison sees as a breach of the spirit of the law.

NICE stands firm, but the public must learn to respect rationing

H. Mooney

Health Service Journal, vol.117, Aug. 23rd 2007, p. 12-13

The National Institute for Health and Clinical Excellence (NICE) has won a high court battle over the prescription of drugs to treat Alzheimer's disease. The high court backed NICE's ruling that Aricept, Renimyl and Exelon should only be prescribed free to people in moderate stages of the disease. NICE uses economic models to weigh up the cost effectiveness of every new drug. In a cash limited health service, which cannot fund all expensive life-saving drugs, one person's treatment will mean another going without.

Pay modernisation: a new contract for NHS consultants in England

National Audit Office

London: TSO, 2007 (House of Commons papers, session 2006/07;HC 335)

The new contract for NHS consultants aimed to introduce more management control over their work activities in exchange for a career structure and pay system that rewarded those who made a long term commitment to the NHS and the biggest contribution to service improvement. The report concludes that the contract is not yet delivering value for money. Some consultants are working the same or fewer hours for more money, yet consultants' morale has been damaged in the process of implementing the new contract and there is little evidence that ways of working have actually changed.

Tales from the edge

V. Vaughan, H. Mooney, and A. Nolan

Health Service Journal, vol.117, Aug. 2nd 2007, p. 20-22

Presents three case studies of how hospital trusts emerged from severe financial crises and took radical action to get deficits under control.

(For further case studies see Health Service Journal, vol.117, Aug. 9th 2007, p. 22-24 and Aug. 30th 2007, p. 22-23)