The National Audit Office has found that almost 50 NHS Trusts are struggling financially, with many having to consider merging with others to survive and a handful branded “unviable” in any form.

The study of the 113 non Foundation Trust (FT) Trusts revealed that many hospitals are weighed down by their debts and others have weak leadership and management or deliver poor quality care for patients.

In these cases, Trusts will be unable to meet the Government’s target of becoming semi-independent FTs by 2014, with their situation made worse by the “Nicholson challenge” of recouping £20 billion in efficiency savings by the following year.

Ministers may use taxpayers’ money to bail out failing hospitals or they could be forced to merge with better-performing neighbours, face takeover by private healthcare firms or close down entirely.

Margaret Hodge, the Labour Chairman of the Public Accounts Committee, said that the report asserted that at least 20 Trusts will never achieve FT status in their current form, and as many as 48 are unlikely to obtain FT status unless they substantially improve their financial position.

Failing to make FT status means that Trusts will not have the freedom to take on more private patients and in doing so make more money due to the burden of their Private Finance Initiative (PFI) schemes. These PFI schemes have provided hospitals with modern facilities but mean making large interest payments for decades.

The 48 that are unlikely to qualify will need “additional work” to balance their books, such as £376 million of loans just to support them for each additional 15 working days. All 48 struggling Trusts recently had to draw up plans for their future, known as Tripartite Formal Agreements, and 20 of them are “not financially and/or clinically viable in their current form”.

Seventeen of the “most challenged trusts” are looking for hospitals or private sector firms to take them over but six trusts with the heaviest PFI debts are considered “not viable under any of the tested scenarios”, and are likely to need significant Treasury funding.

While 80% of the 113 non-FT Trusts face financial trouble, 65% have “quality and performance” problems and 39% need improvements in “governance and leadership”.

The Government has announced that they will outline a “national support” system for some Trusts, but has pledged to introduce a rigorous “failure regime” for the first time in the NHS rather than continuing with secret bailouts.

In an increasingly tough financial climate, it is essential that NHS managers have access to tools that in addition to assisting in the efficient running of services also provide information on costs and where they are incurred. In an attempt to improve clarity around outcomes, Trusts could seek to implement an Electronic Patient Record (EPR) System like Therapy Manager which illustrates the true Costs of Care by speciality and by condition, ensuring that the highest quality patient care is provided at the best price.

Original Source The Telegraph

About Pathway Software

Pathway Software (www.pathwaysoftware.com) specialises in the design and development of patient information systems for Allied Health professionals.

Its flagship product, Therapy Manager, is an Electronic Patient Record (EPR) system specifically designed for Therapy Services to provide decision makers with the ability to track and manage clinical activity and analyse cost of care by patient, episode or service. The system also demonstrably reduces administration time and the costs of managing Therapy Services.