NHS review: Billions wasted each year on variations in care and finances

A review into how hospitals operate aims to save the NHS £5 billion annually. Credit: Peter Byrne / PA Wire/PA Images

A comprehensive 18-month review into how the NHS can become safer and more efficient has found billions is wasted every year by Trusts on variations in care and finances.

The report, compiled by efficiency expert Lord Carter and set to be published today, found unwarranted differences in hospital running costs, sickness absence, infection rates and prices paid for supplies and services.

In order to maximise the £102bn annual budget allocated to the NHS, Lord Carter has advised hospitals to end variations in quality of care and finances that cost the NHS billions by standardising procedures, be more transparent, and work more closely with neighbouring trusts.

Some of the variations Lord Carter found across the NHS during his review are outlined below:

  • Average running costs for a whole hospital (£/m2) vary starkly at different trusts starting at £105 at one trust and going as high as £970 for another.

  • Infection rates for hip and knee replacements vary from 0.5 - 4% - meaning you're eight times more likely to contract an infection at the worst trust, compared to the best.

  • Prices paid by different hospitals for hip replacements vary from £788 to £1590.

  • The use of floor space varies significantly with one trust using 12% for non-clinical purposes and another using as much as 69%.

  • Sickness and absence rate vary from 3.1% to 5% - meaning staff are 60% more likely to be absent due to sickness at the worst trust compared to the best.

Some of the recommendations in Lord Carter's review are listed below:

  • The NHS should end the use of outdated and inefficient paper rosters and implement electronic rosters.

  • Improving staff productivity by five minutes every shift could save the NHS £280m a year

  • Trusts should publish the time doctors and nurses are able to spend caring for patients, to improve patient care.

  • From April 2016, trusts will publish their receipts on a monthly basis for the top 100 items bought by the NHS.

  • Increased transparency will drive down prices and end the days of trusts paying wildly varying costs for the same goods - saving hospitals £1 billion a year by 2020-21.

  • Trusts' unused floor space should not exceed 2.5%.

  • Expenditure on administration should not exceed 7% by 2018 and 6% by 2020.

  • Hospitals should work with local government representatives to ensure patient care is also focused on recovery to tackle the issue of bed blocking

  • Trusts should work closely with their neighbouring hospitals, sharing services and resources in a bid to improve efficiency and drive down costs.

As part of the review, a 'model hospital' has also been developed which will advise trusts on the most efficient allocation of resources and allows hospitals to measure performance against other trusts.

It has been shaped by Lord Carter's experience of best performing hospitals in the NHS and internationally and will enable trusts to replicate those examples.

Lord Carter suggests implementing the tool will save hospitals £5 billion a year by 2020-21 and put an end to the variation the review uncovered across the NHS.

Lord Carter was asked to undertake the review by Health Secretary Jeremy Hunt. Credit: Neil Hall/WPA Rota/PA Images

Health Secretary Jeremy Hunt welcomed the findings and recommendations of the review.

He said: "I want to make the NHS the safest healthcare system in the world, capable of providing the same world class care every day of the week, powered by a culture of transparency and learning.

"This groundbreaking review will help hospitals care for patients, making sure every penny possible is spent on frontline patient care and bureaucracy is slashed so doctors and nurses can concentrate on caring."

Lord Carter will continue to engage with and support trusts to realise the efficiency improvements they can make over the coming months.

NHS Improvement will lead the implementation of the recommendations and Lord Carter will become a non-executive director of the regulator in April.