A report on public expenditure by the House of Commons health select committee, led by former health secretary Stephen Dorrell (Con, Charnwood), warned that the government's NHS reforms made the required financial savings more difficult to achieve.
The committee said many NHS organisations had not fully grasped the 'Nicholson challenge', which requires PCTs to deliver 4% efficiency savings per year for four years. Organisations are instead using the Quality, Innovation, Productivity and Prevention (QIPP) initiative to make cuts to existing services, rather than redesigning care.
The MPs said that NHS organisations were ‘making do and squeezing savings’ from existing services simply to get through the first year of the QIPP programme rather than making changes for the future.
‘We heard little to persuade us that this overriding need to do things differently is being planned for in future years and we are convinced that the required level of efficiency gain will not be achieved without significant change in the care model,' the Committee's report said.
The MPs said that, in order to succeed, service redesign needs to account for significantly more than the designated 20% of QIPP savings.
‘The Committee is particularly concerned that the statistical distinction drawn by the Department between 20% of savings arising from service reconfiguration and 40% arising from reduced tariff is misleading.
‘National policy guidance emphasises the importance of substantial service change, while the statistical presentation appears to suggest that traditional salami slicing will yield savings which are twice as large as the savings delivered by service change,’ the report said.
Worry over savings
The Committee expressed concerns about the government's confidence that savings were on track, despite evidence from a number of sources suggesting this was not the case.
MPs also criticised the DH for requiring NHS organisations to make bids for funding to short deadlines, at the same time as they were required to make savings and redesign services.
In order to provide efficient and high quality patient care in a time of financial pressure, the report recommended that health and social care be integrated.
‘Health and social care must be seen as two aspects of the same service and planned together in every area for there to be any chance of a high quality and efficient service being provided which meets the needs of the local population within the funding available,’ the report said.
The MPs recommended that the amount spent of care of the elderly needed to be ‘rebalanced’ and the amount of money transferred from the NHS to social care could be increased.
‘The Committee believes that, as a matter of urgency, the DH should investigate the practicalities of greater passporting of NHS funding to social care,’ the report said.
However the report warned that reorganisation of the NHS was making it more difficult for organisations to achieve their efficiency targets. ‘We heard that [the reorganisation] more often creates disruption and distraction that hinders the ability of organisations to consider truly effective ways of reforming service delivery and releasing savings,’ the report said.