Casting Care Aside

2. No costings provided

The financial assumptions underlying the Health Authority's
consultation document remain shrouded in mystery.  While WHA
indignantly and vociferously denies that its drastic "down-sizing" of
hospital services in Worcestershire is motivated by the massive £9m a
year cash shortfall, or by the cumulative deficit - estimated at £18m
in November (and £15m in the consolation document, pp30-31) - it is
clear that the total package is intended, and expected, to save money.

Specific questions to the Health Authority, requesting a financial
analysis of the proposed changes, and a breakdown of the projected
cash savings, have failed to elicit any supplementary information
which might enable any confidence to be placed in their consultation
document.  Instead, hiding behind the formula that their plan is
merely a "strategy" and not a detailed plan, WHA managers have chosen
to brush off questions, and attempted to conceal the gaps and
contradictions in their proposals.

It is conspicuous that while the WHA scheme aims to cut back revenue
spending to a more modest target, its programme of cuts fall far short
of the reduction needed to tackle the health authority's cumulative
shortfall.  And nowhere does the consultation document or the
supporting documents identify sources for the capital and revenue
required for the service developments that are proposed.

Is it the case, as has been rumoured, that WHA has been offered an
undertaking from the NHS Regional Office that their back debts can be
written off if the Worcester PFI deal and the rationalisation are
pushed through?  If not, what steps are being taken to deal with these
enormous debts?  Are the current cuts simply the first wave?

Chapter Eleven of the WHA consolation document spells out some ways in
which savings are expected to arise from the new plan.  These include
a number of unproven and unquantified elements:

Cutting management costs

There seems to be scope for some reduction in spending on the Health
Authority itself, and possibly some savings from the ending of the
"internal market" system, although the overall costs of establishing
and running Primary Care Groups have yet to be quantified.

We note that the Health Authority, which has run up a cumulative
deficit of £15m and which, according to its Chief Executive, lacks the
resources even to develop a financial analysis of its own strategy
document - cost £4.3m to run in 1996/97, with four senior executives
paid in excess of £55,000.

This appears to be extremely poor value for money, especially for
residents in Wyre Forest and north Worcestershire, whose local
services face major cutbacks, and whose clearly expressed views have
so far been completely ignored by WHA.

WHA also calls for a merger of acute Trusts, and for community and
mental health services to be run by a single county-wide Trust.
Although savings on redundant Trust bureaucracy are to be welcomed,
one unheralded implication of the WHA proposals would be the complete
liquidation of the Kidderminster Trust, along with its inpatient
services.

Another significant result of the proposed merger of acute Trusts into
a single countywide body would be to leave hospital services
throughout the county dominated by the Worcester Royal Infirmary (and
thus by the long term bills that will flow from leasing its
privately-financed buildings).  Residents in north Worcestershire are
therefore likely to pay twice over - through the loss of their local
services and through longer-term financial pressure on services - for
the new hospital in the south of the county.

An extremely optimistic - and very specific, though unexplained -
target of £830,000 is set for "reducing bureaucracy and management
costs".  If no financial analysis has been done, where does this
figure come from?  If an analysis has been done, why has it not been
published?

We are not the only ones to question how robust are the prospects of
big savings from merging Trusts.  We note that the SECTA Financial
Review - commissioned by WHA warned in October 1997 that "Trust
mergers on their own will probably not generate significant savings"
(4.1.8).

"Better use of buildings and property"

WHA projects savings of £1.57 million from the closure (and sale?) of
land and buildings which are deemed "surplus to requirements", which
include a partial rationalisation of the Kidderminster General
Hospital site, closures of clinics in Tenbury and Bromsgrove, and the
"review" of all clinics in Redditch.

Despite the appearance of a precise figure, we are not told how much
of the saving would flow from reduced overheads and how much from
property sales and reduced capital charges.  WHA's "Financial Issues"
document of February 13 claimed that £0.5 to £0.6m a year could be
saved from capital charges, suggesting substantial land sales.

The same document reveals that further savings on capital charges - of
up to £1m are hoped for through "partnership" deals develop Pershore
and Tenbury community Hospitals "with GPs, local Authorities, NHS
Trusts, League of Friends, etc." However the savings on capital
charges would only be achieved if the NHS relinquished ownership of
some or all of the assets: perhaps the "partners" - and local patients
- should be told.

Nor are we told the full extent of the projected retrenchment at
Kidderminster General, which certainly goes far beyond the initial
proposals included in the consultation document: it seems that as much
as 60% of the current site could be left vacant by the axing of
almost all in-patient services.

"Non-clinical support services"

WHA claim that a massive £2 million could be lopped from spending on
support services, without offering any specific proposals on where the
cutbacks would take place.  Since this work is heavily labour
intensive and tends to be at the lowest end of NHS pay scales, savings
of this size could only arise from a substantial cutback in the jobs
and working conditions of existing staff.

WHA's "Financial Issues" document on February 13 argued that services
"such as waste disposal, maintenance, catering and cleaning" would be
targeted for savings.  This appears to conflict with the findings of
the SECTA Financial Review which last autumn found that the hotel and
operational costs of the Trusts (which totalled around £19m in 1996-7)
"are not particularly out of line with national trends".

It appears that either the £2m savings target (around 10% of current
spending) is unrealistic and over-ambitious, or WHA intends to cut
spending on these support services to well below national average
levels, implying heavy loss of jobs and poorer quality services.

Clinical support services

Again offering no details or explanation, WHA is projecting a £700,000
saving on "clinical support" - which we discover only from the
"Financial Issues" document means pathology and pharmacy services -
as a result of its strategy.  Clearly this figure must be based on be some
working assumptions on where jobs will be cut.  "Financial Issues"
claims that the savings are to come from "increased efficiency and
integration of services": why have the proposals not been published?

Perhaps it is a reluctance to divulge the scope of these combined cuts
which has led to WHA's failure to offer any projection of job losses
in Kidderminster.  Rough estimates so far (unconvincingly denied by
the Health Authority in public meetings) suggest that just over a
third of the existing total workforce at Kidderminster General perhaps
600 posts - could face the chop over the next 3-5 years.  WHAs
"Financial Issues" document reveals a projected cost of redundancies
and early retirement payments totalling £9m over the next four years,
confirming that large numbers of jobs are to go.

Reviewing health care purchasing

While cutting back on services in the county (and while assuming that
over 1,000 more medical in-patients a year will be diverted from
Kidderminster to Dudley's Russell's Hall Hospital), WHA declares its
intention to spend less money on services outside the county or in the
private sector - and, without any explanation, assumes a "saving" from
this of  £700,000.

This, too, seems to be wildly optimistic, and is out of line with the
SECTA Financial Review last October, which warned that "in practice,
the eventual saving would probably be a maximum of £0.5m once
geographical flows and other issues are taken into account." (2.6.5)

Making more efficient use of hospital beds

WHA projects a hefty £1.7m saving from more intensive use of the
reduced number hospital beds, but once more fails to explain how this
is to be achieved.  Recent experience of hospital rationalisation
(notably the closure of A&E and acute beds at Edgware General
Hospital in London) have conspicuously failed to deliver the
expected economies and efficiency savings.

The loss of local hospital beds in Kidderminster, compounded by the
problems of transport for visiting relatives and friends, and
increased difficulties co-ordinating the discharge especially of frail
elderly patients over longer distances are likely to result in an
increase in the average length of stay, especially in medical beds,
which could well counteract any potential savings.

Even those most wedded to the idea of maximising the efficient use of
beds have expressed some scepticism about the scale of savings
projected by the WHA plan, which appears to be based on applying the
targets for the Worcester Royal Infirmary's PFI Business Case to
Trusts throughout the county.

The PFI scheme, which proposes to impose a 24% cut in acute in-patient
beds at WRI, seeks to reduce the number of beds per 1,000 episodes by
a massive 40%, from 15.3 to just 9.6. The SECTA Financial Review
points out that if this target were applied throughout the county it
could further reduce acute beds by up to 120.

There is one huge problem, however: there is no evidence to show that
this target is attainable in the foreseeable future.  The SECTA Review
refers to the King's Fund and Tomlinson reviews in London, which
prescribed a massive reduction in acute bed numbers, but does not
refer to the consequences of these ill-thought out proposals - the
soaring waiting lists, and the repeated "trolleys" crises which have
resulted as patients queue often for days on end for emergency
hospital beds in the capital.

The recent strategic review of London's NHS commissioned by the
government found that as a result of these cuts Londoners now have
less access to hospital beds than elsewhere in the country, and urged
a halt to further bed closures.

The SECTA Review also points to the need to prepare for any reduction
in bed numbers by developing community support services and
"alternative development care settings (e.g. rehabilitation
facilities)".  Such plans and the resources to implement them - are
conspicuously missing from the W strategy.

SECTA concludes - and reiterates (3.10.2, 3.11.8) that the WRI bed
targets may not be achievable, and will certainly be hard to attain:
"achieving bed capacity targets included in the Worcester Royal
Infirmary PFI proposal across the county would be a major challenge"
(2.8.1).  Yet it appears that the WHA targets for cash savings assume
this challenge has already effectively been fought and won.

In short, the WHA projections, which purport to show efficiency
savings adding up to £7.5m, appear to be at  best "guesstimates", or
at worst wishful thinking, rather than robust and objective
appraisals.

Financial impact of rationalisation plan

The Health Authority claims that the changes it is proposing for acute
services will release an additional sum "for reinvestment", over and
above the "efficiency savings".  Once more - without any supporting
explanation or argument - we are told that this could amount to "a
minimum of £1.2m" but might be as much as £4m.

The mystery is deepened when WHA goes on to assert, yet again without
any evidence, what the comparative costs of alternative options would
be: these range from "no net savings" to "a net extra cost to the
County of  £4.8m". Since WHAs Chief Executive has insisted that WHA
has insufficient resources to provide a Financial Analysis of its
current strategic plan, the source and authenticity of these projected
figures must be a puzzle.

By contrast, Kidderminster Health Care Trust has published figures
which claim that the potential £7.5 million to be "saved" by switching
services away from Kidderminster Hospital would be largely wiped out
by the £7m which would have to be spent buying the same services from
other Trusts, and an extra £200,000 spent on community reprovision,
leaving a net saving from the whole chaotic exercise of just £300,000.

Just as its figures lack any weight, argument or conviction, so too
does the WHA assertion that "the Health Authority does not and would
not support any proposal simply to save money".

There is nothing in Investing in Excellence that would disprove the
view that a health authority desperate to make hefty cash cuts has at
best turned a blind eye to the decimation of local services that would
result from its plans in the Kidderminster area.

Developments not costed

Just as alarming as the dubious claims that easy savings can be made
are WHA's glib suggestions of service developments with no discussion
of costings or identified resources available for them.  Among the
empty, unfunded promises to be found scattered through Investing in
Excellence are the following:

"Development" of community hospitals at Pershore and Tenbury and the
"redevelopment" of community hospitals at Evesham and Malvern - which,
we note, contain no commitment to maintain inpatient beds. (pp 12-13)

"Development" of  Princess of  Wales Hospital, Bromsgrove. (p13)

Establishment of "specialist community teams designed to prevent
unnecessary admissions to hospital" (p13)

"Intensive home support schemes" (p13)

"Specialist response teams (for example, for stroke victims)" (p13)

"24-hour district nursing teams" (p13)

"Redevelop the Elgar Unit and surrounding buildings" (p15) Even
though this is linked with the planned PFI redevelopment of WRI (which
would be on the Newtown Hospital site), no details are offered on how
it would be funded.

"New adult in-patient mental health facilities on the Princess of
Wales / Brookhaven site in Bromsgrove." (p5)

More generalised promises on the front page of the summary of
Investing in Excellence include:

"Strengthening and expanding services provided by GPs and primary care
teams from local surgeries, health centres and clinics."

"Creating a network of community mental health resources centres ..."

"Developing specialist urology and orthopaedic services at the
Alexandra Hospital in Redditch for the whole of the County."

Many of these suggested schemes are perfectly reasonable and even
desirable in themselves.  However in the context of the actual
financial pressures on WHA they appear designed more to placate
potential opponents of the WHA strategy in the north of the county
than in any real expectation that the cash will be forthcoming to
carry them out.

Part 3:  Bogus Theories on Acute Beds