Comment / Have we been here before? Turbulent times for costing practitioners

It’s 12 months virtually to the day since I wrote an HFMA blog that started with the following paragraph:

‘It’s been a challenging start to 2023 for everybody involved in costing, both practitioners and the central team at NHS England. But just as we start to see signs of new life in our gardens over the past few weeks, we have also started to see the early seeds of change.’

At the time NHS England had just confirmed that the national cost collection (NCC) would take place in 2023, following some months of uncertainty. The collection did take place, although, as reported by the HFMA on numerous occasions, it was fraught with delays and problems. Submission was finally completed in January 2024. We await publication of the results and there is not currently any indication of the timeframe for this.

The 2022/23 submission marked the final stage of the NHS England Costing Transformation Programme, with all sectors mandated to submit patient level information for the majority of services in accordance with the NHS England’s Approved costing guidance.

NHS England has confirmed that it expects the collection window for the 2024 NCC to open on Monday 10 June and run for eight weeks, closing on Friday 2 August. It has just released the approved costing guidance for this year, with only minimal changes on last year’s version. This is all good news for practitioners although I’m sure many of them will approach the submission period with a degree of trepidation and doubt given the problems of recent years.

However, there remains an elephant in the room in respect of the NCC submission. For many years costing practitioners have pointed to the burden and complexities of producing the data for submission compared with local cost data, and the impact this has on them and their organisations. Many costing practitioners I speak to are frustrated that despite having the expertise to provide timely cost data and support their own organisations in driving productivity, efficiency and long-term financial sustainability, the NCC takes them away from this.

Increasingly evidence points to the benefits of using cost data to support system-wide transformation that addresses the imperative to reduce health inequalities, focus on prevention and improve population health, to ensure that limited health and social care resources are utilised equitably and appropriately. But there are significant risks that these opportunities will be missed if the costing practitioners are not able to support this work.

Completion of the costing transformation programme does give NHS England an opportunity to take stock of the NCC. It has recently stated that the focus going forward will be on using the data. And I am pleased to see that it is working with practitioners and other key stakeholders to review the requirements for costing, through a future of costing advisory group. We are yet to see any recommendations, but meetings are ongoing. 

In September 2021, my predecessor Catherine Mitchell worked with members of the Healthcare Costing for Value Institute to establish 10 tests of what good costing should look like in the NHS. At the time it was written in response to plans to move to more frequent cost collection at national level, which were later shelved.

On the back of the current review by NHS England, I recently took the opportunity to revisit the September 2021 briefing and think about what progress had been made against the 10 tests, and what still needs to be done. The updated briefing was published towards the end of February. Unfortunately, many of the concerns highlighted in the original briefing remained valid and it would be fair to say that, on balance, the local and national landscape for costing does not fully meet the requirements of any of the 10 tests.

Through HFMA and the institute, we will continue to encourage and promote best practice in the local use of costing data and skills of the practitioner and highlight why this is so important. But as outlined in our updated briefing, the outcomes from the NHS England review must create the capacity for this to happen.

Nobody is denying the need for a national collection of cost information. It is vital for use in national benchmarking and providing insight through tools such as Model Hospital/Health System and Getting It Right First Time (GIRFT), as well as informing the NHS payment scheme. But in recent years the delay between the end of the financial year and publication of results from the NCC has diluted these national benefits and led to increasing frustration not just from practitioners, but also from their senior leaders.

Over the past few years we have seen a number of very experienced practitioners leave, or threaten to leave, the costing profession and there are known recruitment problems. This is a real shame and not what the service overall needs when these individuals have the vital skills required to help address the ongoing financial and operational sustainability of services, and to train the next generation of costing leads.

I hope that the outcomes arising from the current review by NHS England will be sufficiently radical to finally address issues I’ve raised here and in the briefing. The project needs to avoid just making simple tweaks and bolt-ons to existing guidance, which may actually introduce more burden.

I acknowledge that’s going to be virtually impossible for NHS England to develop a solution that keeps everybody happy and there may need to be some short-term pain for the long-term gain. However, given the uncertainty and challenges that practitioners have faced in the past decade, there is no doubt in my mind that this is a vital review. And it may be the last opportunity to come up with a solution that is future proofed and encourages finance professionals to join and stay in costing roles.