Each year, the Government decides how much to raise benefits and tax allowances. The basis for these upratings is rarely debated, yet has major long-term consequences for the relative living standards of different groups and for public finances. The impact of benefit and tax uprating on incomes and poverty from the Joseph Rowntree Foundation considers the implications of present uprating policies, which mean that some parts of the tax and benefit system are uprated by earnings growth, other parts by prices and some not at all.

The impact of continuance of these polices over the newxt 20 years will be a doubling of the child poverty rate alongside a substantial gain to the public finances. Some of this budgetary gain may be needed to meet other demands – of an ageing population for example – but the cost falls disproportionately onto poorer groups and could be raised more fairly.

New statistics from the NHS Information Centre

• Expenditure on health
• NHS stop smoking statistics
• Hospital outpatient statistics
• Diagnostic waiting times

Individual Budgets and the interface with health: a discussion paper was commissioned by CSIP as a stand alone piece of work to capture the issues and learning from the Individual Budgets pilot regarding the interface between Individual Budgets and Health. A “think tank” session was organised with key stakeholders from the Cabinet Office, Department of Health, In Control and Individual Budget pilot sites to discuss these emerging issues and any relevant activity.

Working for a healthier tomorrow from Working for Health identifies ten key challenges:

• The economic costs of sickness absence and worklessness associated with working age ill-health are over £100 billion a year
• The evidence base supporting the business case for investment in the health and well-being of their employees is inadequately understood by employers
• Lack of appropriate information and advice is the most common barrier to employers investing in the health and well-being of their employees.
• The importance of the physical and mental health of working age people in relation to
  personal, family and social attainment is insufficiently recognised in our society.
• GPs often feel ill-equipped to offer advice to their patients on remaining in or returning to work. Their training has to date not prepared them for this and, therefore, the work-related advice they do give, can be naturally cautious.
• The current sickness certification process focuses on what people cannot do, thereby
  institutionalising the belief that it is inappropriate to be at work unless 100% fit.
• There is insufficient access to support for patients in the early stages of sickness, including those with mental health conditions. GPs have inadequate options for referral and occupational health provision is disproportionately concentrated among a few large employers.
• The scale of the numbers on incapacity benefits represents an historical failure of healthcare and employment support for the workless in Britain.
• Detachment of occupational health from mainstream healthcare undermines holistic patient care.
• Existing departmental structures prevent Government from fully playing its part in meeting the challenges set out in this Review.

It also makes 10 recommendations:

• Government, healthcare professionals, employers, trades unions and all with an interest in the health of the working age population should adopt a new approach to health and work in Britain.
• Government should work with employers and representative bodies to develop a robust model for measuring and reporting on the benefits of employer investment in health and well-being. Employers should use this to report on health and well-being in the board room and company accounts.
• Government should initiate a business-led health and well-being consultancy service,
  offering tailored advice and support and access to occupational health support at a market rate, geared towards small business.
• Government should launch a major drive to promote understanding of the positive
  relationship between health and work among employers, healthcare professionals and the general public.
• GPs and other healthcare professionals should be supported to adapt the advice they provide, where appropriate doing all they can to help people enter, stay in or return to work.
• The paper-based sick note should be replaced with an electronic fit note, switching
  the focus to what people can do and improving communication between employers,
  employees and GPs.
• Government should pilot a new Fit for Work service based on case-managed,
  multidisciplinary support for patients in the early stages of sickness absence, with the aim of making access to work-related health support available to all – no longer the preserve of the few.
• When appropriate models for the Fit for Work service are established, access to the service should be open to those on incapacity benefits and other out-of-work benefits. This should integrate with with employment and skills programmes and Pathways to Work should cover all on incapacity benefits as soon as resources allow.
• An integrated approach to working-age health should be underpinned by: the inclusion of occupational health and vocational rehabilitation within mainstream healthcare.
• The existing cross-Government structure should be strengthened to incorporate the
  relevant functions of those departments whose policies influence the health of Britain’s working age population.
• The existing cross-Government structure should be strengthened to incorporate the
  relevant functions of those departments whose policies influence the health of Britain’s working age population.

Why the NHS is the sick man of Europe by James Gubb of the think tank CIVITAS argues that market-based reform in the NHS is being crushed by central direction and will fail if this pressure continues. It recognises that the NHS’s ideals of universal and comprehensive health care are admirable, but suggests the delivery mechanism is not.

The report compares the NHS with health systems in countries such as France, Germany, Switzerland and the Netherlands which it states succeed in delivering much higher standards of health care than the NHS for all. The key difference between the NHS and these health systems is that the state is not cast as either the main funder or provider of health care, but effective regulator.

It suggests that rather than a tax based health system, social insurance is fundemental because it ensures the consumer - the patient - controls the purse strings, not the government and the health service is therefore much more responsive.

In each comparator country the following universal principles apply:

• All individuals are obliged to pay into a health insurance plan from a menu of insurers;

• Insurers are obliged to accept all the applicants that choose them;

• The government both defines the mandatory minimum package, and pays for/tops up for those on low incomes or with excessive health risks.

France and Germany achieve this direct from wages, the Netherlands and Switzerland through health premiums supported by subsidies for the less well off and sick.

Following the the Ministerial Industry Strategy Group’s Longterm leadership strategy  for medicines to encourage joint working between the NHS and pharmaceutical industry it was recommended an interactive toolkit was developed to support this.  The strategy had three main themes

• Improving the relationship between the NHS and industry to support the better use of cost effective medicines
• Supporting the European Commission’s plans to improve the competitiveness of Europe through the High Level Pharmaceutical Forum
• The need to improve the effectiveness of medicines regulation.

The toolkit aims to:

• encourage NHS organisations and staff to consider joint working as a realistic option for the delivery of high-quality healthcare
• provide the necessary information and have easy access to the tools which will help to enter into joint working.

A selection of templates are also available.

How Boards use financial management information is critical to delivering value for money from public funds. Reporting financial management information to the Board is a self assesment guide from the National Audit Office to help Boards receive the information they need.

Good financial information available to key decision makers at the right time has a beneficial effect on organisational performance conversly poor or inadequate financial information has  a negative impact on effective decision making. To support Boards to fulfil their responsibilities effectively, the financial management information that they receive must be clearly linked to the organisation’s performance against its objectives and fit for purpose in terms of scope, quality and presentation.

The third quarterly report on NHS finance and service performance shows that the NHS is still on course for a £1.8 billion surplus for this financial year, with only seventeen trusts reporting a deficit. This surplus is about two per cent of the overall NHS budget.

NHS Pay Modernisation: New contracts for general practice services in England (Executive Summary) from the National Audit Office notes that it has contributed to improved recruitment and retention of GPs, with numbers increasing from 26,833 to 30,931 since 2003. However, the contract has cost the Department £1.76 billion more than it originally budgeted for.

In the first two years of the contract, productivity has fallen by an average of 2.5 per cent per year. GPs are working on average seven hours less per week than in 1992, partly because of the removal of the responsibility for out of hours care. While the number of consultations with patients has increased, these are not in proportion with the increase in costs. Primary Care Trusts’ spending on GP services has however now started to level off.
The largest overspend of the contract was due to an underestimation of the amount that GPs would earn from the pay for performance scheme, the Quality Outcomes Framework (QOF). While there is evidence that the QOF has improved consistency in the quality of care, it is too early to say if overall patients’ health has improved as a result.

In 2005-06 the annual average pay of a GP partner was £113,614, an increase of 58 per cent since 2002-03. GPs report, however, that over the last year their pay has stayed the same or decreased. GP partners have taken more profit from the practice as pay while the average salary for GPs they employ increased by only three per cent in the first two years.

The report found that nurses are delivering more practice work leaving GPs to spend more time with more complex cases. The proportion of consultations undertaken by practice nurses increased from 21 per cent to 34 per cent between 1995 and 2006. GPs now spend more time with each patient, an average of around 12 minutes compared to 8 minutes in 2002-03.

The report concludes that Primary Care Trusts have not made use of all the levers in the new contract. Money for new local services has not led to improvements such as increased opening hours and some of the most deprived areas remain under-doctored. Some 40 per cent of GPs believed that aspects of the contract had not helped tackle health inequalities.

The report recommends that the Department develop a strategy for yearly negotiations on the QOF and the QOF should be based more on health outcomes. Primary Care Trusts should provide more services based on local need and review the number and skills of staff employed to commission and performance manage GP services with the aim of improving local commissioning.

The purpose of the Code of Conduct for Payment by Results (PbR) 2007/08 is to establish core principles, with some ground rules for organisational behaviour, and expectations as to how the system should operate, and to minimise disputes, as well as guide the resolution of them. This is Version 2, issued March 2007, which is not a comprehensive update of the original Code published in January 2006. Instead, limited changes have been made to reflect the developments in the national tariff for 2007/08, i.e. unbundling and the data quality assurance framework. We anticipate a more thorough review of the Code once the consultation on the Options for the Future of PbR is complete.

PbR introduces a degree of transparency in NHS financial flows that is almost unprecedented. The new system challenges organisations to manage successfully in a dynamic environment and creates incentives for increasing productivity and making efficient use of resources.

The Secretary of State requires compliance with this Code by all NHS Bodies operating PbR, including health authorities, NHS trusts and primary care trusts (PCTs). .

A report from the think tank the Taxpayers Alliance suggests the bill for public sector pensions is of growing concern for taxpayers facing huge bills for underfunded and over-generous pensions. In December 2007, the TaxPayers’ Alliance (TPA) revealed that there are almost 3,700 retired civil servants with retirement benefits worth £1 million. In the second paper of our public sector pensions series, they look at the generosity of pension arrangements in the NHS in England and Wales.

In £1 Million NHS pensions using information obtained from the NHS Business Services Authority Pensions Division, TPA researcherscalculate the extent of the taxpayers’ pension commitments. The findings are:

• There are almost 8,500 retired NHS employees (including GPs) in England and Wales with retirement benefits worth £1 million.
• The total value of these retirement benefits is almost £8.5 billion (up to £337 per household)

To access this video you will be required to give some details about yourself to HealthExecTV.

The World Class Commissioning initiative provides a major opportunity for Trusts to transform care services and develop new ways of maximising the value of limited healthcare budgets.

While Trusts wait for the WCC Assurance Framework, there are many ways to start planning the transition to World Class Commissioning. Evidence-based analysis of population requirements, how money has been spent and how other organisations are approaching commissioning is a key starting point.

In this interview, Andrew Beale, Executive Director of Matrix Knowledge Group consultancy, discusses how evidence-based analysis can help Trusts to better understand their current position, population healthcare patterns and to maximise the benefit of their investments within the available resources.

‘Lost: low earners and the elderly care market’, from the think tank the Resolution Foundation looks at low earners and how they fare in the elderly care system. It identifies that social care for older people rarely receives the political attention it should. The Government’s recent commitment to a Green Paper on social care provides the opportunity for elderly care to become centre stage. Theis report establishes how low earners fare in the elderly care system.

It identifies that:

• Low earners tend to be older than average, and more likely to own their own homes. They also hold disproportionately more of their wealth in housing assets (as opposed to liquid savings) than other income groups.

• Are less likely that higher earners to prepare financially for retirement through
  pensions, and worry more than other income groups as to whether they will have sufficient assets to retire comfortably.

• Inclusion of housing assets when calculating care cost contributions is of critical importance to low earners – it renders the majority of them ineligible for subsidised care, and also most at risk of having to sell their homes or downsize in order to access their wealth to pay for care. This is in contrast to lower earners,who may not own their own homes and be eligible for subsidised care, and higher earners, who may have sufficient funds to pay for care from their liquid assets, such as savings or annuities, rather than their homes.

• Low earners feel the system to be unfair – in the very low level of means testing benchmarks which excludes the majority of low earners from any state funded care; in the inclusion of housing assets which penalises those who have saved

Key messages are:

• There is acceptance that increased elderly care costs cannot be met by the government alone. Low earners still believe only the very wealthy should pay for their care costs, and that the majority of people should receive government funded care or only make a small contribution.

• The number of self funders – i.e. those who either wholly or partially pay for their elderly care – is rising, and will continue to do so, because local authorities are adjusting their eligibility criteria so that only those with greater care needs are eligible for free home or residential care, leaving those with “lesser needs” (which are now nonetheless significant) to fund themselves, regardless of income.

• For those who cannot afford to self-fund formal care – which is likely to be a more common situation amongst low earners – informal care (i.e. care provided by friends or family free of charge) is crucially important. Estimates suggest that 70 per cent of the care provided in England and Wales is currently delivered by informal carers. Demography points to the fact that the numbers of low earners reaching an age where elderly care is required will increase substantially in the next 5 to 10 years, yet the increasing number of elderly living alone, not marrying and not having children will mean there will be fewer children and relatives for older people to rely on to provide them with informal care

• Finally, low earners are also more likely to be carers of relatives than the rest of the population. The age profile of this group, combined with these factors, suggests that a significant proportion of low earners may be shouldering a dual burden – they may be caring for their elderly parents, but also still supporting (financially and otherwise) their own children. This “squeezed” generation phenomenon, which affects women in particular, will be a significant factor affecting their quality of life, but may also have a longer lasting, intergenerational impact – people who give up work to care for relatives will not be contributing to their pensions.

The Right Result? Payment by Results 2003-07 details how Payment by Results (PbR), has been embedded across the NHS and has helped hospitals to be more business-like.  It should start to deliver the significant increases in productivity and efficiency across the NHS that the policy was designed to achieve.The PbR policy was introduced by the government four years ago and is a system of paying hospitals nationally set prices for the number of patients and types of conditions they treat. It is designed to encourage hospitals to treat more patients, more efficiently without compromising quality of care.

This Audit Commission report finds that under PbR most hospitals have improved their financial management and now have a better understanding of how much it costs them to treat patients. The impact on the NHS in terms of efficiency and activity has been smaller than expected, however, and PbR seems to have contributed to positive trends rather than driven them.

The report sets out a number of priorities for future development of the policy that need to be addressed if PbR is to deliver further improvements:

For Primary Care Trusts

• Further develop commercial, legal and contracting skills, identifying gaps in line with the developing World Class Commissioning competencies, to improve their ability to operate in the PbR environment.

• Ensure that 2008/09 contracts contain appropriate incentives and penalties to support appropriate, high quality care, for example, readmissions targets, and that information requirements are clearly specified and enforceable. Progress against these targets should be reported regularly.

• Adopt a robust yet proportionate approach to monitoring and challenging provider activity and costs under contract, prioritising investment in practice level information systems so that practices can engage in the planning and monitoring of hospital activity.

• Actively monitor provider actions in response to the Audit Commission’s PbR data assurance audits, and use the findings from these audits to supplement existing information on potential data quality issues.

For Acute NHS Trusts

• Ensure that robust information and reporting systems are in place that meet all internal and external requirements within the minimum reporting deadline of 30 days following the end of the month, and that local information systems are in place to complement SUS as necessary.

• Embed and promote service-line management and reporting, paying particular attention to the use of surpluses and how this will be managed within the organisation.

• Understand the costing data they require to manage the business, and invest in improving internal costing systems, considering the business case for introducing patient level costing systems where appropriate.

• Prioritise the implementation of the OPCS-4.4 classification system for procedures, to improve coding internally and to support the introduction of HRG4.

• Engage in discussions with commissioners about changing patient pathways, demand management and use of local flexibilities, such as unbundling the tariff into its component parts.

For the Department of Health

• Identify and explicitly prioritise the changes that will be most effective in achieving policy objectives, and ensure that the development programme for addressing these priorities is realistic, properly resourced and communicated to stakeholders.

• Ensure that timely guidance, support and direction continues to be provided to both commissioners and providers in a balanced way, including more effective mechanisms for receiving and providing feedback, particularly in relation to contract and information issues.

• Review and address the perceived limitations of SUS in supporting PbR, ensuring there is a clear vision for NHS data and organisations’ responsibilities that is shared by NHS Connecting for Health and the Information Centre for Health and Social Care, and that the expectations of the NHS are consistent with this vision. Additional steps should be taken to ensure that guidance from these bodies is consistent.

• Invest in information systems to capture and report on community services and support the development of an appropriate payment mechanism.

• Monitor usage of the new standard contract and reinforce the move toward a consistent approach to contracting across the NHS, providing guidance as appropriate to ensure that balanced, fair contracts, that support nationally agreed principles, are negotiated.

• Use the tariff as a policy lever to drive desired behaviours, rather than purely as a reflection of average costs, signalling likely changes to the NHS well in advance.

• Explore the use of separate payment streams in addition to the tariff, for example to reward quality or to fund capital costs, where this is necessary to provide the right incentives to NHS bodies.

• Carefully monitor the implementation of HRG4 to ensure that the additional complexity of the payment classification is warranted and is not undermining policy objectives.

Mental Health Act Commission Twelfth Biennial Report - Risk, Rights, Recovery finds that there are severe funding issues faced by providers of mental health services in that:

• Patients deemed to be a threat to themselves or others are being denied hospital beds while commissioners disagree with regard to funding.

• The Mental Health Act Commission has found practitioners are being told to delay sectioning people with urgent mental health needs until primary care trusts ascertain who should pay for their treatment.

• The problem is caused by high bed occupancy levels and the need for PCTs to balance budgets.

• This has encouraged PCTs not to detain patients who have travelled from other areas until the home PCT has agreed to pay.

Thse practices are unsuprisingly condemned in this report.

Afghanistan: Economic incentives and development initiatives to reduce opium production from the World Bank and the Department of International Development calculates that it will take up to 20 years to eradicate and require a £1bn investment from world leaders.

Afghanistan produces and trades more than 90 percent of the world’s illicit opium. The size of the opium economy is around 30 percent of licit GDP, and millions of Afghans benefit directly or indirectly from it. The economic challenge of opium is overwhelmingly a rural one, argues the report: opium is the most valuable agricultural activity, and it provides income and employment for hundreds of thousands of Afghans.

These give details on how and on what over £41 billion of NHS expenditure was used in the 2006/07 financial year.   The main purpose is to provide a basis for comparison within (and outside) the NHS between organisations, and down to the level of individual treatments.

• Overview and summary
• Appendix RC1 Reference Costs Index (RCI)
• Appendix NSRC1 - NHS trust reference cost schedules
• Appendix NSRC2 - Primary care trust reference cost schedules
• Appendix NSRC3 - PMS and pilot reference cost schedules
• Appendix NSRC4 - NHS trust and PCT combined reference cost schedules
• Appendix NSRC5 - Non-NHS providers schedules

Mental Health Act Commission Eleventh Biennial Report (In Place Of Fear) questions whether all inpatient mental health services provide their patients with acceptable levels of security, care, or a sense of being treated as  someone who matters. It welcome the Government’s announced refocus on inpatient services and call for it to concentrate on building up these aspects, in place of the fear that many patients have of services and that many people have of mentally disordered people.  The importance of breaking such ‘circles of fear’ for Black and minority ethnic patients are particularly welcomed.

There is evidence that inpatient services are losing staff and resources to community
services, but that pressures on inpatient beds remain high. Over half of all wards are full or have more patients than beds, with staffing shortages and unpleasant ward environments undermining the therapeutic purpose of inpatient admission.

The report highlights the dangers inherent in devolved service commissioning for ensuring adequate levels of specialist provision, and note the vulnerability of mental health services as Trusts face financial crises.

The extension of patient ‘choice’ across health service provision should not be allowed further to disadvantage or ostracise patients who are unable to exercise choice because of their mental incapacity or because of legal powers of compulsion held over
their treatment.

Boundaries of current mental health law under stress, with discussion of about forty cases
in court, and a more general observation of legal powers being used in ways that may not have been intended by Parliament, often for pragmatic reasons where professionals are keen to intervene in what they perceive to be a person’s best interest or as measures of social order.

It also discusses aspects of the use of present mental health powers in relation to civil detention and police powers, including an extended discussion on the detention of mentally disordered offenders.We provide analysis of deaths of detained patients; seclusion incidents notified to the Commission; and Second Opinion activity during this period.

The report has a strong focus on measures to encourage and support the empowerment of all patients, including those without mental capacity to make certain decisions about their care.

It finally reviews the proposed future arrangements for monitoring detention of mentally disordered persons and suggest ways in which the forthcoming Mental Health Bill might be improved to ensure acceptability to mentally disordered persons and the effective protection of their rights.

Mental Health Act Commission Eleventh Biennial Report - Errata and Addendum

Giving a comprehensive overview of the social care sector in England ‘The state of social care in England 2006-07 (Executive Summary)’ the Annual Report of the Commission for Social Care Inspection follows concerns raised by the Commission last year, and explores the experiences of people not deemed eligible for state-supported social care. It shows that many younger disabled people and frail older people are being ‘signposted’ to voluntary services. Many are forced to rely on help from family and informal arrangements which can break down at short notice. People unable to rely on families or friends and unable to pay for care services themselves are simply left to cope with everyday life, while some become virtually trapped in their own home.Local authorities are increasingly only helping those with ‘substantial’ or ‘critical’ needs. This despite the use of a national set of rules (called Fair Access to Care Services - FACS ) to decide who is eligible for support. However who does or doesn’t get help varies not only between but also within the same council. In practice the criteria can be interpreted in different ways by local staff.

The full report can be downloaded using the links below along with the evidence that informed it.

State of social care - foreword & overview

State of social care - context and focus

State of social care - part 1

State of social care - part 2

State of social care - appendices

Lost to the System? The Impact of Fair Access to Care

Self-funded social care for older people: an analysis of eligibility, variations and future projections

You can also download the mp3 audio summary Audio summary.

Summary of responses to the  ‘Options for the Future of Payment by Results: 2008/09 – 2010/11′ consultation put forward proposals for future developments in PbR including tariff setting, coding and classification, expanding the scope of PbR, and supporting health policies through financial reform.