A perfect storm: an impossible climate for NHS providers’ finances?

An analysis of NHS finances and factors associated with financial performance

March 2016

Sarah Lafond
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Key points

  • Our analysis finds that organisations with a high proportion of their pay bill going on agency staff coupled with more of their income being paid through the PbR tariff rather than negotiated prices are associated with being in deficit. 
  • We also find that poor quality ratings either from CQC or the hospital’s own staff are associated with poor finances. 
  • This is not causation and our analysis can’t tell us if finances cause quality problems, quality problems cause finance problems or, as is most likely, they are bound together in complex inter-connected ways.

This report examines the financial performance of the NHS in England. The main focus is on the finances of NHS providers and the financial position of the commissioners of care (NHS England and clinical commissioning groups).

The report examines commissioners’ budgets and how spending has changed by type of provider, as well as the specific issues facing NHS providers. It also includes the findings of a statistical analysis that set out to identify factors that are most strongly associated with an acute or specialist provider’s deficit.

 

Further reading

Research report

Hospital finances and productivity: In a critical condition?

In this report we examine the financial performance of NHS providers, focusing on hospitals.

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