Allocation formula blamed for higher rural PCT deficits

The PCT deficit crisis is driven more by geography than bad management, a study has found.

PCTs in deficit are in areas seven times less densely populated than PCTs in surplus, and they receive £205 less per resident than PCTs in surplus.

A study of 29 PCTs in deficit and 29 in surplus, published in Health Services Research, found that those in financial deficit tended to serve affluent, rural areas in the East of England, while trusts in financial surplus served deprived, urban areas.

The study has accused the DoH's resource allocation formula of unfair positive discrimination and has urged policy makers to review it.

The authors, including Dr Padmanabhan Badrinath, a consultant in public health for Suffolk West PCT and Cambridge University, concluded: 'PCTs in financial surplus appear to be those that have benefited from the positive discrimination of the DoH's resource allocation formula.

'With the DoH committed to reducing health inequalities in the UK, targeting funding to those areas with the poorest health must be an objective.'

The study questioned whether the allocation formula took adequate account of rural poverty and the problems of dispersed communities.

Professor Alan Maynard, a health economist from the University of York, said it was difficult to improve on the system without access to better information.

A DoH spokesman said: 'The key to getting the NHS back into balance is improving financial management.'

edward.davies@haynet.com

BMC Health Services Research

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