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514 Economic crisis, health systems and health in Europe: country experience
Payment to providers
England
• Payments to acute hospital providers through payment by results tariffs
were frozen in real terms in 2010–2011 and set at 1.8% below inflation
in 2011–2012 and 2012–2013. This translates into a cut in real terms of
just under 4% overall. Further real cuts in 2013–2014 and 2014–2015
imply a real reduction since 2010–2011 of nearly 7%.
• The Department of Health announced new measures in 2012 to make
procurement of goods and services more effective. The Department
estimates this will produce savings of £1.2 billion by 2016.
Northern Ireland
• Efficiency savings from 2008–2009 to 2010–2011 in the Department of
Health, Social Services and Public Safety were implemented by cutting
the budgets of the health trusts that provide care by 2.5% in the first year,
rising to 3.5% in the final year.
Overhead costs: restructuring the Ministry of Health and purchasing agencies
England
• The Treasury's Spending Review in 2010 indicated the administration
budget of the Department of Health would be reduced by 33% between
2010–2011 and 2014–2015, from £5.1 billion to £3.7 billion in real
terms. For the first time this sum included the budgets of arm's-length
bodies. Government is in the process of reducing the number of arm'slength
bodies, mainly transferring their functions elsewhere. The goal was
to reduce the number from 18 to a maximum of 10 by 2014.
• All regional management bodies and local commissioning organizations
(primary care trusts) were replaced with as many if not more bodies with
similar functions (2013).
Northern Ireland
• Administration cost limits were set in the first budget of the devolved
government; the Department of Health, Social Services and Public Safety
limit was to steadily reduce costs from £42.6 million in 2007–2008
to £40.4 million in 2010–2011. The pressure to reduce administration
costs has been maintained in the second budget, which covers up to
2014–2015.
Scotland
• Health directorates are included in the Scottish Government's drive to
reduce administration costs by 25% between 2010–2011 and 2014–2015.
• A national target was set of reducing by 25% the number of senior
managers in the NHS by 2015 (2010).