19.03.13
NHS too focused on short-term fixes – MPs
The Nicholson Challenge will have to be extended beyond 2015, but is not a sustainable long-term solution to greater efficiency, the Health Select Committee has warned in a report on public expenditure of health and care services.
The committee examined the reported achievements of the Nicholson Challenge in its first full year and found that the only way to sustain or improve present NHS service levels will be to continue the challenge after 2015.
For long-term savings, the committee has concluded that integration is the only way forward, with CCGs and Health and Wellbeing Boards charged to commission integrated services rather than providing services which “merely treat conditions”.
Social care should also have ring-fenced funding introduced, the report recommends.
The report states: “Too often, however, the measures used to respond to the Nicholson Challenge represent short-term fixes rather than long-term service transformation. Although it is certainly true that public sector pay restraint has the short-term effect of reducing the cost of service provision to the NHS, the Committee does not accept that it can be regarded as a sustainable form of efficiency gain.
“Sustainable efficiency gain involves securing improved quality or value for a given expenditure – it is not delivered by simply suppressing staff salaries. Nor can genuine efficiency gains be found simply in reducing the tariffs paid by NHS Commissioners to NHS Providers, unless such a tariff reduction results in a genuine change in the way care is delivered on the part of the provider. There is little evidence that tariff reductions are resulting in real and effective changes in care delivery.
“The committee remains of the view that sustaining the breadth and quality of health and care services can only be achieved through a fully integrated approach to commissioning in each area, dependent on local circumstances.”
Mike Farrar, chief executive of the NHS Confederation, said: “The Health Select Committee raises some critical questions about how we secure the future of the NHS.
“We need to look beyond the short term options and consider more radical solutions that will improve care in the long-term and allow us to manage the resources we have on a sustainable basis.
“We need to involve the public in these discussions. We can do much more to create a modern, affordable system that works in the best interests of patients. Getting this right may require some difficult decisions, including centralising some services, and moving others out of hospitals and into people's homes.”
Professor John Appleby, chief economist at The King’s Fund, said the report “hits the nail on the head” and added: “The financial squeeze is beginning to bite hard in the NHS and efficiencies are becoming harder to deliver, as one-off savings such as cuts in management costs start to slow. As the report points out, pay restraint and holding down prices paid to hospitals are no substitute for delivering genuine productivity improvements.
“In focusing on the need to develop integrated care, the committee has identified the right starting point. This should include making better use of existing resources by bringing together health and social care budgets locally and moving towards a single, strategic assessment of the funding needs of the NHS and social care in future spending reviews.”
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