FOR IMMEDIATE RELEASE 4 MARCH 2013
NHS spending on independent healthcare services up over 10%, but disparity across sectors
In their penultimate operational year PCTs across England increased their spend on services commissioned from independent healthcare providers by 10.7%. This compared to a 3.5% increase in total healthcare spending from NHS and non-NHS providers.
According to Laing and Buisson’s new NHS Financial Information 2013*, total NHS spending on healthcare services supplied by the independent sector in England - covering private companies and voluntary organisations - was estimated at £5.9bn in 2011/2012 - some 6.5% of the £90.7bn total healthcare spending by PCTs in England during the period. This marks decent overall growth from the £5.3bn spend in 2010/2011, then equivalent to 6.1% of total spending.
Driving this increase was strong growth of over a third in spending on independent community health services (£1.5bn), energised by the end of direct provision by PCTs during the year. It was further supported by strong growth in general and acute health service spending, which rose by nearly a fifth to be £1.6bn.
However, not all health sectors fared well.
PCT spending on primary care services supplied by independent sector providers fell sharply by over a quarter (26%) to £84m, while there was another sharp decline in spending on learning difficulties (down 12%), and spending on mental healthcare was static.
Spending more than any other PCT on independent healthcare services, Birmingham East and North PCT increased its spend by 10% in 2011/2012 to reach £201m. Surrey PCT was the next highest at £185m but increased its spend by an even larger 14%. Increased dependency on the independent sector was most notable from Nottingham City where spend was up from £85m to £136m, and Cornwall and Isles of Scilly, up from £77m to £120m. Meanwhile there was no real increase in dependency in Hampshire, and Yorkshire, (see Table 1 below).
Consultancy spending more stable
Spending on consultancy services by Trusts was more stable in 2011/2012, showing only a small real decline following sharp cutbacks a year earlier which were fuelled by the NHS goal to realise massive cost savings by 2014 under a new commissioning structure. In England and Wales the NHS spent an estimated £466m during the year, compared to £457m a year earlier but still well down from consultancy spend of £605m in 2009/2010.
New commissioning arrangements underpin reduced spending by most PCTs, which overall moved down from £138m to £110m, and saw Strategic Health Authorities spend noticeably less, moving from £36m to £24m.
Notable examples include City and Hackney Teaching PCT which spent £7.9m in 2010/2011 but only £4.7m in 2011/2012, and Oxfordshire PCT, down to £4.9m from £7.3m. However, against this trend Westminster PCT more than doubled its spend from £4.7m to £12.4m, the highest of any PCT. Similarly, Wandsworth PCT moved sharply up from £1.9m to £7.6m.
Unaffected by a new NHS structure, however, was the use of consultants by NHS Trusts and Foundation Trusts, as their combined spend increased strongly from £278m to £325m, driven by leading London Trusts. The largest single spender here was King’s College Hospital NHS Foundation Trust, which increased its spending by close to a third from £24.6m to £32.3m. The second largest was Guy’s and St Thomas where consultancy spend went up by 50%, rising from £10.7m to £16.8m. Barts moved from £5.5m to £8.8m. Outside London a notable climber was East Sussex Hospitals Trust which spent £4.9m in 2011/2012, compared with less than a million a year earlier.
NHS private patient incomes up ahead of inflation
NHS Financial Information 2013 also reports that total private patient income of NHS Trusts in the UK was £471m in 2011/2012, increasing by 5.3% from £448m in 2010/2011, edging ahead of economy inflation. However, regional trends confirm that growth was stronger in London, with the Top 5 private earners (Royal Marsden, Royal Brompton & Harefield, Guy’s & St Thomas, Moorfields, and King’s College) seeing combined revenues climb by 15%. Health and social service Trusts in Northern Ireland also reported strong growth (up 9.5%), but conversely, private patient income fell sharply for the NHS in Scotland (down 18%), and in Wales (down 8%).
TABLE 1: SPENDING ON INDEPENDENT HEALTHCARE SERVICES1 (PRIVATE & VOLUNTARY inc ISTCs)
| BIRMINGHAM EAST AND NORTH PCT
| SURREY PCT
| HAMPSHIRE PCT
| LEICESTERSHIRE COUNTY AND RUTLAND PCT
| NOTTINGHAM CITY PCT
| CORNWALL AND ISLES OF SCILLY PCT
| EASTERN AND COASTAL KENT PCT
| BRISTOL PCT
| NORTH YORKSHIRE AND YORK PCT
| LEEDS PCT
| TOP 10 TOTAL
1 Covers Primary Healthcare, Learning Difficulties, Mental Illness, Maternity, General & Acute, Community Health Services, and Other Secondary Healthcare.
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*NHS Financial Information 2013 presents financial data for all NHS (& HSS) Trusts and Boards in the UK, including statement of comprehensive income, statement of financial position, cash flow, staffing volumes and staff costs, temporary (non-NHS) and permanent (NHS) staffing, expenditure breakdown, non-NHS spending, efficiency savings, and other information. For the second successive year it includes Hospital Activity Data.
Provided as a series of Microsoft Excel spreadsheets the dataset it priced at £895 (+VAT). Discounts are available for healthcare providers and academic institutions. Available from Laing & Buisson, 29 Angel Gate, City Road, London, EC1V 2PT. Tel: 020 7833 9123. Web: www.laingbuisson.co.uk
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