Health service to face years of austerity

The NHS has seen massive growth since 2000, with a budget of more than 100bn including 9bn in Yorkshire.

But from next year, latest projections suggest NHS resources will increase by only about one per cent a year for the following three years – effectively a cut in real terms because of inflation and the inevitable increase in demands for care.

Whichever party is returned at the election, major savings will be required.

The scale of efficiencies, amounting to more than 1bn in Yorkshire, will not be achieved by sacking a few managers – although management costs will be slashed by 30 per cent.

Instead, wholesale redesign of the NHS will be needed. Broadly speaking, cash will be cut from hospitals and ploughed back into services provided in the community and at home.

It remains unlikely hospitals in the region will close but some will shut departments and buildings as complex treatments move to regional centres and other care is shifted into the community – particularly for those with long-term conditions whose needs account for an estimated 70 per cent of spending.

The scale of the task ahead is summed up by health chiefs in Bradford who say: "We will transform the health system over the next five years.

"We will develop a lower cost, better integrated and highly efficient local health and social care economy which will be targeted at having the greatest possible positive impact on the health of the population."

In the East Riding, health chiefs are predicting a financial gap of 105m across the health economy by 2013-14 unless efficiencies are made.

Measures will include reducing lengths of stay in hospital, cutting outpatient appointments, reducing emergency admissions and establishing thresholds before patients are treated.

Primary care trust managers say: "We still have priorities in all the areas of our cradle-to-grave strategy but we will put more emphasis on prevention and management of long-term conditions, such as heart disease, diabetes, respiratory disease and dementia."

Mergers of back-office functions can be expected with NHS officials in Bradford, Wakefield and Doncaster among those raising the prospect of a range of public sector organisations joining forces in organising pay or procurement.

One key problem is that the sheer scale of savings has never before been carried out in the NHS which has found it difficult to achieve small efficiencies – its productivity has even fallen in the past decade.

Hospital cuts and closures also typically raise public opposition, which could lead to delays or halt plans to achieve savings.

The changes must also be made against ever-increasing demand for services, mainly due to the ageing population and technological developments which mean more can be done for more people but often at great cost.

In Calderdale, GP referrals for hospital treatment have risen by more than five per cent in the past 12 months and unplanned hospital work by nearly 10 per cent which managers say cannot continue.

The task of treating more people out of hospital will instead fall on family doctors and NHS community care and social care teams.

|However, uncertainties remain about how much this can save and if it will be effective – with the risk that patients could fall through gaps in services provided by different organisations that have failed to work well together in the past.

Cash crises set to continue

NHS services in North Yorkshire have been beset by funding problems for years.

Among future pressures faced by the county is a 22 per cent increase in over-65s by 2020 – a rise of 45,000 – who are most likely to need the NHS.

Next week, health chiefs will unveil 130m "quality and productivity" savings over four years – with 53.5m cut in the next 12 months from a 1.2bn budget.

Priorities include reducing hospital visits, tackling diseases affecting the elderly and helping people deal with their own conditions.

The PCT estimates it could save 3-4m each year if patients with 19 long-term conditions avoided hospital.