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Provider sector stands up to pressure of rising demand but at a cost

NHS Improvement has published its full report into the performance of NHS providers in 2017/18. In a nutshell, it finds that NHS staff and managers have cared for more patients than ever before, but a surge in demand for services has affected its performance in key areas, such as waiting times and reliance on temporary workers.


An unprecedented demand for A&E led to hospitals cancelling operations and hiring temporary staff to cover vacancies and sickness. From January - March 2018 more than 5.87 million people went to A&E; that’s an increase of more than 220,000 on the same period in 2017. During the same period 1.1 million of those attending A&E needed to be admitted for treatment; that’s 70,000 more than the previous year. 


Staff cared for more people in A&E within the four-hour standard but even so performance against slipped nationally from 89.1% last year to 88.4% this year. In addition, the number of patients waiting over a year for elective treatment stood at 2,647 at the end of March 2018 compared to 1,513 in March 2017.


Financially, the sector ended the year with a deficit of £960m, which is more than it anticipated, but is an improvement on 2015/16 when the deficit was £2.45 billion. Acute hospitals are largely responsible for this overspend, with the increase in demand for A&E mainly over the winter months being blamed. 


The report says that whilst the provider sector was in deficit, viewed as a whole the NHS was broadly in balance, as NHS England has provisionally reported a £955m underspend for the healthcare commissioning sector in 2017/18. 


The Chief Executive of NHS Providers, Chris Hopson, says Trusts have delivered a creditable performance in difficult circumstances. “NHS Trusts and frontline staff are working harder than ever in the face of a relentless rise in demand for care, severe workforce pressures and a continued funding squeeze.


“The figures we see today reflect the worrying gap between what the NHS is being asked to deliver and the resources available following almost a decade of austerity. And we must remember that today’s figure masks the full underlying deficit, which is much higher, and how reliant the NHS continues to be on one-off savings.”


Sally Gainsbury, Senior Policy Analyst at Nuffield Trust, elaborates: “The reported figures are very much window dressing. Our analysis suggests that the true, underlying figure is much, much worse as the NHS has had to patch up its finances with a series of one-off savings and emergency extra cash.


“This report reveals that the £960m reported deficit figure is arrived at after around £850m of one-off savings - even higher than last year* - as well as the non-recurrent £1.8bn Sustainability and Transformation Fund. Taking these into account, along with other short-term fixes, the true underlying deficit is likely to be in the region of £4bn – similar to our own projections**.


“This hand-to-mouth existence is not a sustainable way to run complex and vital institutions like hospitals.”


Chris Hopson says the pressure on health and social care is being felt by both patients and staff. “There are not enough staff, ambulances, community and mental health capacity or hospital beds to cope,” he said. Furthermore, the sharp rise in emergency admissions meant there was less income from planned procedures such as knee and hip replacements.


“Looking ahead to 2018/19, financial and workforce pressures are increasing. For the longer term, we welcome the prime minister’s recent commitment to increase long term funding for health and care and look forward to the new comprehensive health and care workforce strategy.


“But these figures show a substantial part of any additional spending on the NHS in the future, will be spent on fixing the shortfalls that have built up in recent years.”



* Non-recurrent efficiency savings totalled £842m in 2017/18, compared to £789 in 2016/17



** Click here to read more detail of this analysis.