Cuts to tariffs – the prices paid to hospitals for different medical procedures – are starving health trusts of income and contributing to the growing financial crisis in the NHS, according to new analysis published by the TUC and UNISON today (Wednesday).
With the NHS forced to find £20bn in efficiency savings over the last five years, one of the main ways money has been saved is through cutting tariffs, typically by 10 per cent or more since 2010.
But the research conducted for the TUC and UNISON by False Economy shows that for many procedures the tariff cuts have been far more dramatic.
False Economy examined the tariffs for nearly 700 procedures. Since 2010 over half had been cut by more than 10 per cent, and a third by more than 30 per cent.
One in six elective procedures – including treatments for kidney stones, asthma, blood poisoning, glaucoma, tuberculosis, leukaemia, diabetes and sickle cell anaemia – had their tariffs slashed by more than 50 per cent since 2010.
Looking in more detail at hospital activity rates for almost 130 different NHS procedures, False Economy found that between 2009/10 and 2014/15 cuts to tariffs meant that hospitals had suffered a net income loss of £70m. And as these procedures only covered around three per cent of total budgets, False Economy has estimated that the actual revenue losses for hospitals as a result of cuts to all tariffs could be more than £2bn.
These stealth cuts are having a huge impact on hospital finances, say the TUC and UNISON. Recent evidence from Monitor (the health service regulator) showed that 60 out of a total of 83 acute foundation trusts were in the red, reporting a net deficit of £438m. Evidence from the Trust Development Agency and Monitor suggests that the combined deficits of NHS trusts and foundation trusts at the end of 2014/15 could reach £800m.
Full story at The TUC website