Planning for sustainability

01 November 2017 Mark Knight

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We’ve been told continually that the government has given all it can to the health system and we must make do.  But there are hopeful signs of a change in this mantra, with confirmation that the pay cap will be scrapped. There is a consensus this is the right decision. 

Staff income has been eroded in real terms. They need to be treated fairly – morale and staff buy-in are fundamental to meeting the ongoing day-to-day demands of delivering healthcare and the transformation challenge. It is also pragmatic given current labour shortages and continuing pressure to reduce agency spending.Value 

What we haven’t heard anything about is how increased pay flexibility will be funded. It seems inconceivable that local health bodies could be expected to meet the increased cost pressure from the previously announced settlements.

NHS bodies are performing heroics to improve the service’s financial position but deficits, particularly among providers, remain a problem and provide an imperfect foundation for transformation. I am nervous about a ‘sticking plaster’ approach to meeting current funding challenges, though any increased funding would be welcome. 

I am reminded of the end of the millennium when the then new Labour government stuck doggedly to the previous government’s spending settlement and dripped funds out to the service when extreme needs demanded it.

As president Mark Orchard has commented, what we need now is a sustainable plan for the next 30 years, not the next six months. The danger is that short-term plans and ‘turnaround’ behaviours take over because NHS bodies have to meet their control totals. As one finance director said to me recently: ‘Whatever happened to value?’  

The HFMA Healthcare Costing for Value Institute is championing the cause. Its international symposium showcased examples of where organisations round the world, including the UK, are pioneering the approach with exciting results. But there is no doubt that we need to see a much wider take-up. 

The institute has a healthy crop of clinicians involved and it is they who are driving the value agenda. This is really encouraging and we need to ensure the finance function stays fully in step with these clinical champions.

As part of creating sustainable services, the NHS must continue to embrace new technology.  Speakers at a recent HFMA USA event talked about the tipping point – where technology ceases to be a cost and becomes an efficiency tool. As an example, the speaker credited technology with a dramatic reduction in US air fares over recent decades. The NHS must exploit this type of transformation – reducing GP and outpatient appointments or facilitating virtual consultations and supporting people to manage their own health and conditions.

I’d like to finish by recognising Tony Whitfield, who last month received his OBE from the Queen. It was a tremendous day for him and his family. And two days prior to that, Louise Shepherd, another former board member and honorary HFMA fellow, received her CBE. Many congratulations to them both!