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NHS primes 'failure regime'

The Department of Health is creating a so-called 'failure regime' in a bid to prevent NHS hospitals getting into serious financial difficulties.

The Department of Health is creating a so-called 'failure regime' in a bid to prevent NHS hospitals, including those of Foundation level, getting into serious financial difficulties.

The system, which is currently being put out to tender, will aim to identify the warning signs of failure and ensure that clinical and financial difficulties are dealt with quickly and appropriately to protect primary care trusts and NHS hospitals, as well as the growing number of private providers of NHS services.

ìIn a large organisation like the NHS, which provides a vital public service, identifying problems early is not only normal practice, it is good practice,î a spokesman for the Department of Health told PMLive.com.

ìThere is already a robust regime in place to manage the performance of NHS organisations and this work will help make it even more effective,î he added.

However, the move follows the well-documented fall from grace of Bradford Teaching Hospitals - one of the government's flagship Foundation trusts - which recently admitted having amassed uncontrollable debts of at least £11.3m.

With the election approaching, and healthcare taking centre stage, Labour is keen to avoid seeing a duplication of Bradford's dilemma, for which the regulator of Foundation trusts, Monitor, was called upon to send in professional financial advisers.

Commenting on the new 'failure regime', a spokesman at director level for Monitor, noted: ìIt is a necessary step to have something like this in place. Insolvency is a real issue. Hopefully it will not be needed, but it is helpful to have a regime set up that highlights all the processes and issues.î

Some have speculated that the government's overt move to set up a contingency operation is a 'sure-fire indicator' of the uncertainty of plans to overhaul the struggling NHS.

The DoH has admitted that it needs the new failure warning system to be up and running for the financial year start in April, according to media reports. It was reportedly such a priority that potential bidders for the tender were given only 10 days to respond.

A spokesperson for the Department of Health would not be drawn on the exigency of the situation: ìI don't think we've decided what the timescale is yet.î

Yet, the way in which the NHS is financed is set to change dramatically from April, when the 'payment by results' scheme for hospitals will become used more extensively. At the same time, the new independent treatment centres will come more into play, with contracts to ensure they get paid, regardless of whether NHS patients are sent to the or not.

According to a survey in the Health Service Journal, some 75 per cent of NHS chief executives do not believe that, in the current climate, private sector treatment centres are good value for money,.

The survey found that the need to fill spaces in treatment centres purchased by the government from the private sector threatened non-emergency NHS facilities.

Approximately 250,000 operations a year have been bought by the government from the private sector, at a 15 per cent premium over NHS prices.

30th September 2008

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