Money money money

The original working title of this blog was ‘It’s the patients stupid’. Close followers of politics – and American presidential elections in particular – will be familiar with the now famous phrase coined by Bill Clinton’s strategist James Carville, who in 1992 stated…“It’s the economy stupid”.

So some months ago when I was first preparing this blog – and with a nod to James Carville – I had developed a nice line of reasoning, I thought, which spoke loudly about “It’s the patients stupid”.

Then John Appleby – Chief Economist, Health Policy at the Kings Fund – beat me to it when back in February of this year – in the Health Service Journal (23.02.2012) – he wrote a piece called ‘It’s the money stupid’.

As with much output from the Kings Fund, it is an excellent article and I would commend it to anyone with an interest in the current NHS reforms. And it got me thinking. What really lies behind these reforms? Is it about the patients (stupid) or is it really about the money?

My original intention was to focus on the importance of the patient as part of the reform agenda. It had occurred to me that the patient was getting rather lost in the continuing debate around ‘transition’, ‘assurance’ (process) and ‘organisation’. In my heart I think I still believe this and I hope to return to this theme in a later blog.

However last week I was reminded of the John Appleby article, and my thoughts came back to the question of money. Last week was a busy news week (Leveson, Murdoch, Hunt etc…), however the headline news was unquestionably the fact that the UK economy has fallen back into recession.

Even before that deeply worrying announcement, the new Chief Secretary to the Treasury – Danny Alexander – was announcing the need for Government departments to find a further £16bn savings. This represents a further 5% reduction in government departmental spending and I have seen no communications yet that suggest the NHS is immune from this further austerity measure.

By the middle of the week Professor Malcolm Grant – Chair of the NHS Commissioning Board – was briefing the Health Service Journal that, “There is going to be nothing by way of relief from austerity in the NHS for years to come, so we have to find new ways of doing things.”

Last month Anita Charlesworth – Chief Economist at the Nuffield Trust – was blogging on ‘What the budget means for the NHS?’ It is required reading. She makes it quite clear that the contents of the budget report have profound implications for NHS funding….”things look very tough, probably tougher than the current £20 billion efficiency target” she states. She concludes…”whatever happens, the NHS needs to plan for two more years of belt tightening and it needs to be prepared for them to be tougher than they are now.”

On a related theme, the Financial Times – also in March – was reporting that the £20bn ‘Nicholson Challenge’ could be looking more like £50bn challenge.

Which takes me back even further. To May 2010 in fact and the note left to his successor – David Laws – by the then Chief Secretary to the Treasury – Liam Byrne – which is said to have read… “Dear Chief Secretary, I’m afraid to tell you there’s no money left.”

So where is this all leading?

Well in simple terms these are the waters that the new clinical commissioners are navigating. In pure financial terms the waters are dark and choppy in both equal measures.

Of course for the Government, clinical commissioning is seen as the essential driver for delivering the efficiency savings demanded of the NHS. The vision is that they will do this by capping demand through service re-design. For my part, the elephant in the room here is de-commissioning.

But no sane government is simply going to put £65bn into the hands of a group of clinicians and simply let them get on with it.

The NHS Commissioning Board and its outposts will ensure that performance management and financial accountability is writ large across the system.

So what does this mean for emerging Clinical Commissioning Groups (CCGs) and Commissioning Support Units? (CSUs) Well it means that these organisations had better get a grip on the money.

Which means of course that they need robust and reliable sources of data about the quantity, quality and cost of their activities. Furthermore the CEOs, COOs and FDs of these commissioning organisations need a precise understanding of financial risk.

Put simply information is key. You have to have the data and you need to analyse and understand that data. The era of Big Data is surely upon us.

So whilst we never forget that at the end of every piece of data there is a person, we also understand that at that same time there is inevitably a pound sign.

Maybe it is all about the money stupid?

Nigel Slone

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