Finances at hospital trust hit by missed targets

Bosses at Leeds Teaching Hospitals NHS Trust have battled to end the financial year with a surplus of £500,000.

But the total is well below the £10m they had planned to make so that they could apply for prestigious foundation trust status, the gold standard for hospitals.

Last autumn they had already revised their estimate to £5m, but after missing an A&E target because of a critical shortage of doctors, they have lost £3m of funding.

It means that they hoped to end the year with a £500,000 surplus from a £1bn annual budget.

Trust finance director Neil Chapman said: “It’s obviously hugely disappointing that we have had to take two cuts in the year, from £10m to £5m and then virtually down to break even.”

During 2012-13, Leeds hospitals had to find savings of £24m.

To apply for foundation trust status, which all hospitals are expected to do, they need to have a one per cent surplus at the end of the year.

But figures up until the final month of the financial year show the hospital trust’s income has been badly hit by targets being missed.

The main problem was not achieving the A&E target, which is to treat and discharge or admit 95 per cent of patients who arrive in casualty within four hours.

In December, performance dropped to just 80 per cent at St James’s Hospital in the city while Leeds General Infirmary also missed the target, and latest figures show the target is still lower than 95 per cent at both hospitals.

A major shortage of junior middle-grade doctors is behind the problems which has also affected performance at other hospitals up and down the country.

In February, hospital bosses were told that there were just six doctors on a rota which should have 22.

At the time there was a 60 per cent vacancy rate in emergency medicine registrar posts, which was set to increase to 72 per cent in June.

A lack of available beds has also caused problems, especially at St James’s.

Mr Chapman told a meeting of hospital directors: “It’s all around the four-hour A&E target and the fact that we are not going to hit the target for the year. That has cost us £3m.”

He added: “This is going to become more common in future years because operational performance can and will have a significant impact on financial targets in a way that’s never happened before.”

Targets on patient experience, pressure ulcers and learning disabilities, as well as fewer patients being treated in neurosurgery because of short-staffing also affected the finances.

A financial plan for the next 12 months shows £24m-worth of savings still need to be identified to achieve a £10.1m surplus.

In order to apply for foundation trust status, hospitals are expected to have a one per cent surplus and a cash balance equal to 10 days operating expenditure, which for Leeds would be £25m.

However, they did not meet these conditions in the last financial year.

At the meeting, trust directors heard there currently was no timetable for making the application to become a foundation trust, which has already been significantly delayed.