An independent report carried out by PA Consulting on behalf of the Health Foundation claims that the cost of achieving the government’s priority shift for NHS reform from analogue to digital will require an investment in the region of £21 billion over the next five years. This includes capital and revenue funding.
This would include around £8 billion in capital spending (£5 billion of which is for England), £3 billion in one-off revenue spending (£2.25 billion for England) and £2 billion recurring annual revenue spending each year (£1.5 billion for England). In addition, recurring costs will be ongoing beyond the five-year period.
Scope of the research
The estimates included in the research span NHS services across all care settings and publicly-funded residential adult social care.
The investment required in digital transformation goes beyond the technology itself and needs to factor-in the costs of implementation, as well as ongoing support for training, maintenance, software subscriptions and optimisation. It is highly unlikely that these costs will be achievable within existing NHS budgets, so the report concludes that the government will need to commit additional funding if it is to meet its ambitions to successfully transition from analogue to digital.
The research also points to issues such as lack of information around the costs and benefits of digitisation. Addressing these gaps will be critical to ensure money invested in the digital shift is well spent and that the potential benefits are realised in practice.
Investing in infrastructure
Welcoming the research findings, Dr Layla McCay, Director of Policy at the NHS Confederation, emphasised the importance of investment in infrastructure.
“The NHS has long needed research to understand the true cost of digitisation, which is part of the government’s three shifts. We have called for sustained funding to replace, upgrade and maintain essential digital and IT infrastructure, as well as vital estates upgrades, of which digital infrastructure is fundamental. What is now clear from this new research are the ongoing high costs associated with this as modern digital infrastructure continues to evolve, and the need for a process of revenue funding for the NHS to achieve a fully digitised healthcare system.”
Three key actions:
• Set out a clear, transformative and durable vision for digitisation in health and social care
• Support the vision for digitisation with the required funding
• Alongside funding, develop a plan for realising the benefits of digitisation.
