Hospital faces £6m cash crisis (From Basingstoke Gazette)

Hospital faces £6m cash crisis

12:00pm Monday 8th March 2010 in

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BASINGSTOKE hospital is braced for severe funding cuts – and bosses have already launched a multi-million-pound belt-tightening programme.

A “prudence project” has been initiated to try to claw back £6million as the hospital enters what has been described as an “unprecedented” period of financial turbulence caused by the much-publicised black hole in the public finances.

With far less health service funding heading to the foundation NHS trust, the challenge is now to make savings while also trying to maintain the high standard of patient care that the hospital has become renowned for.

Hospital trust chief executive Mary Edwards has admitted: “We know we are going to be impacted by the recession and it’s going to be painful. Our challenge is to rise and cope with that while maintaining patient safety.”

Alex Whitfield, the associate director of productivity at the hospital NHS trust and the woman in charge of a cost-cutting project, has identified a series of 200 cash-cutting ideas.

This covers almost all departments, with 120 under way.

She said: “The financial situation is like nothing we have seen before. We have never had less money than the year before. We need a culture change in the NHS. We have a mountain to climb – it is huge.”

While there are no plans for compulsory redundancies, trust bosses have said they expect to cut down the wage bill by losing jobs through natural wastage.

The daunting financial situation – brought on by the black hole in the public finances – was unveiled to the council of governors of the hospital’s NHS foundation trust at their meeting last week.

Money-saving projects already in progress include:

* Sending matrons back on occasional ward duty to slash bank nursing costs.

* Cutting admin by introducing hand-held computers for doctors to prescribe medicine.

* Using prescribed drugs left unused by discharged patients – this could save up to £100,000.

* Reducing missed appointments by sending patients reminder text messages.

* Using micro-fibre mops, which are cheaper to clean – this could save about £120,000.

* Pushing for even greater energy efficiency.

Governors were told the bleak outlook includes rising drug costs and an expected drop in income for providing treatment.

Although £6m is relatively small compared with the hospital’s annual budget of more than £150m, the current package of savings heralds the start of a long-term efficiency drive. It is almost inevitable that the hospital’s 2,800-strong staff roster will have to shrink.

Mrs Whitfield told the governors: “We do not plan to have redundancies as that actually costs money. Instead, we closely monitor recruitment so that we can gradually manage a reduction in numbers especially around non-clinical positions.”

Natural wastage and less dependence on temporary staff were already helping the trust to cut labour costs, she said.

The Government is currently committed to making £2.3billion of efficiency savings in the NHS over 2010-11 and £10bn of efficiency savings by 2012-13.

Further cuts are, however, thought likely as the UK deals with a debt mountain and falling tax revenues because of the worst economic slump since the Second World War.

Meanwhile, NHS Hampshire, which holds the purse strings for local NHS services, is finalising a savings plan that it will submit to NHS South Central Strategic Health Authority at the end of March.

All trusts have been urged to save money with plans for moving treatment out of hospital into people’s homes, reductions in back office and procurement costs, and IT spending.

NHS Hampshire chief executive Debbie Fleming said that unlike previous years, the NHS would not be receiving funding to cover inflation, population increases or for investment in new technology for at least three years.

She said: “Put simply, this means that for every £100 the NHS has now, it might only feel like the equivalent of £80 in the future if we are to cover the cost of demographic and technological growth ourselves through savings elsewhere.”

She added: “We know that by ensuring that every patient gets the right treatment, at the right time, in the right place, high-quality care does not cost more.”