Grant Thornton - Targets in sight: Approaches to delivering NHS cost improvements

Targets in sight: Approaches to delivering NHS cost improvements

CIPs survey Summer 2012

Contents

Foreword 1

Introduction 2

CIP delivery and future plans 3

The drivers behind CIPs in 2012/13 4

Rating the ways to reach CIP targets 5

Can outsourcing of corporate services deliver savings? 7

Opportunities for outsourcing clinical support services 9

How CIP schemes have been received 10

Hitting long-term financial targets 11

Making a success of CIPs 12

Using rewards to drive CIPs 13

The goals of successful CIPs 14

Additional benefits from CIPs 15

About us 16

Contact us 18

1Approaches to delivering NHS cost improvements

When trusts set their financial targets, they look at their expected income for planned activity and the current costs of delivering those services. The mechanism for closing the gap between costs and income has traditionally been the cost improvement programme.

During times of growth, additional income for activity above planned levels was often a key contributor to this gap-closing exercise. But in an era of flat real-terms increases, this simply isn’t an option – at least not when you consider the NHS as a whole.

Cost improvements also get progressively harder. The simple improvements have often been made in previous years – bearing down on use of agency staff, for example. And given the current difficult financial environment is likely to be with us for some time, non-recurrent measures such as vacancy freezes are not only unsustainable, but add to the cost improvements needed in future years.

Added to the current financial context is the quality agenda. As the NHS looks to improve efficiency, it must at least maintain patient safety and outcomes and, wherever possible, look to improve them. No one – frontline or back office – would argue otherwise. And while higher quality can be lower cost by getting things right first time and avoiding unnecessary interventions and duplication, it is not always so straightforward.

The survey undertaken for this report on cost improvement programmes underlines many of these points. It seeks to identify the areas that contributed to organisations’ most recent CIPs and the expected make-up of future savings plans.

In overall terms, the NHS cannot grow its way out of the current financial challenge. But we examine how individual organisations see the role of income generation in meeting their own ‘cost’ improvements. We also examine the appetite to think more strategically in the quest to do more (and better) with less.

What is completely clear is that the NHS faces an unprecedented financial challenge in the coming years. While some organisations have delivered more than 5% efficiencies in the past, estimates suggest that the whole service will need to match this performance. For some areas the challenge will be even greater.

Success will depend upon finance professionals working alongside clinical colleagues and other support services. But as different localities rise to their own CIP challenges, it will be vital to understand different approaches to the delivery of these CIPs and, where appropriate, to share good practice.

Keith Wood Chairman, HFMA Financial Management and Research Committee

Bill Upton Partner, Head of Healthcare, Grant Thornton

Clive Mellor Associate Director, Healthcare Advisory, Grant Thornton

ForewordStrategic thought gets more done with less

2 Approaches to delivering NHS cost improvements

IntroductionMeeting the CIP challenge

As the requirement for savings continues in the NHS, every trust is feeling the pressure. The requirement demands ever greater efforts from all healthcare organisations to meet the ambitious £20 billion savings target, and the drive for new savings and efficiencies to meet this target will become harder over the forthcoming years.

During July 2012, the HFMA and Grant Thornton conducted a survey of NHS trust finance directors to ask them about their CIPs, their experience to date, and how they expected their CIPs to progress over the next three years.

In addition to asking how their CIPs were structured, our survey asked finance directors to rate the relative importance of individual components of their schemes, how different corporate and clinical services were provided at their trust and how their CIPs – and the individual components of their CIPs – had impacted their trust in recent years.

In total we received 34 responses from directors and senior finance staff, representing 14% of provider organisations in the NHS. This included respondents from acute, mental health, community, ambulance and integrated trusts, including both NHS trusts and foundation trusts (referred to as ‘trusts’ throughout this report). Not all directors answered every question, meaning the overall sample size changes for some questions.

The results of this survey are presented in this report with analysis from Grant Thornton and additional commentary on their CIPs contributed by NHS trust directors and senior finance staff interviewed for this report.

We believe it will provide valuable assistance to finance directors in supporting trust boards to deliver on this difficult challenge, and will help to throw light on the progress being made across the whole sector.


CIP delivery and future plansRecent performance on CIPs and the next three years

To put the survey in context, consideration must be given to organisations’ track record in delivering CIPs in previous years and the projections for the next three years. In 2011/12, trusts set average CIP plans of 5.1% of income. By the year’s end, they delivered on average 4.8%; 91% of the target by value.

This corresponds closely to the figures in the May 2012 King’s Fund publication ‘How is the NHS performing’. That report indicated that the average savings achieved amounted to 4.7% of turnover, compared with plans of 5.1% – a shortfall of around 10% compared with plan.

The largest savings, as would be expected, over this period came from pay. While organisations focus on reducing non-staff costs first if possible, it is simply not sustainable to expect continual savings without reviewing employee/workforce levels. Staff costs typically account for around 70% of trust expenditure and CIP plans indicate 54% of savings in 2011/12 were in pay. Respondents to our survey highlighted that many of their savings were achieved through such means as procurement and outsourcing reviews, but acknowledged that staffing was a prime factor in ongoing savings.

A large proportion (62%) of respondents recorded income growth in 2011/12 as contributing to their achieved CIPs, although in nearly half of these cases, the contribution was 15% or less. This income growth related both to demographic growth and the transfer of services from other NHS organisations. Consolidation of services and the creation of local hubs are clearly contributing to this, and specialisation in particular areas appears to be driving further savings in the future.

The received wisdom is that 5% is the maximum cost improvement that can be delivered in the NHS within anyone year. However trusts in the survey planned an average cost improvement of 5.1% in 2011/12 and actually achieved 4.8%. This average masks a number of organisations with planned CIPs that were substantially higher. The full range stretched from 3% to 7.8%. The organisation with the highest planned CIP successfully achieved its plan. On average, the trusts in the sample missed their planned level of improvement by less than 10%. In total 15 out of 32 trusts fell short of their CIP target in 2011/12, with one organisation only achieving 64% of its planned level.

Moving forward, the 5.1% CIP target planned for 2012/13 is the same as that of 2011/12. This target reduces for the next two years, with 4.9% planned for 2013/14 and 4.7% for 2014/15. This is broadly in line with Monitor’s Acute Assessor case financial assumptions of 5.0% in 2013/14 and 2014/15, although their downside case is 5.5% for both years. This is clearly at the challenging end of efficiency improvement and recent experience suggests many will struggle to deliver their CIPs in full. Management and monitoring of CIP delivery will be crucial in underpinning the service’s response to the current financial challenges. Finance directors also recognise that they need to achieve this 5% alongside the improvement of services, maintaining quality and patient safety.

Respondents to our survey highlighted that many of their savings through such means as procurement and outsourcing reviews, but acknowledged that staffing was a prime factor in ongoing savings.


The drivers behind CIPs in 2012/13Expenditure controls and service/pathway redesign emerge as the leading contributors to next year’s targets

We asked respondents to rate the approaches that are driving their CIPs over this financial year. Service and pathway redesign emerged as the leading factor, with nearly 50% naming this as making the single biggest CIP contribution in 2012/13. This suggests there is a recognition that the saving targets won’t be achieved by simply squeezing harder on expenditure budgets. Instead new pathways will be needed. These pathways will need to be centred on patient needs and expectations, delivered in the optimum location and eliminate duplication and unnecessary interventions and tests.

While most trusts identify service redesign as key to delivering their CIP, in many cases this is still a work in progress. Those trusts that had begun implementing plans reported considerable improvements. Trusts who had yet to implement may need to make project management resources available to ensure service redesign ideas are converted into robust deliverable plans.

Expenditure controls generally, however, remain highly significant, with a third of directors suggesting this will be the single biggest component of their current year CIPs. Many respondents named procurement as a key source of savings.

Searching every savings route“In CIP terms, we’re on year three of what has already been 5% each year. And we have to continue that potentially for another two or three years. It becomes a case of what do we do next? Where do we go to make further savings? It becomes more difficult the further you go.

I don’t think we’re doing anything particularly unique, though in comparison with others I think our project management looks more robust. In terms of actual ideas it’s been about skill mix, workforce productivity, back office savings, streamlining management structures and procurement.

With our Private Finance Inititative (PFI), we’re in a 35-year contract, but we had a break where we could test value for money on the soft facilities management contract and that has delivered savings as well.

There is some service and pathway redesign around A&E, diagnostics and outpatients that is additional to the savings on procurement, drugs, bank and agency. We are also pushing the quality agenda, ensuring that we maximise best practice and CQUIN payments.

Our key message is that high quality care costs less. Avoiding duplication, minimising errors and waste delivers improvements in patient quality, and costs less.”

Amy Whitaker Assistant Director of Finance, University Hospital of South Manchester NHS Foundation Trust

WhICh of the folloWIng WIll MAKe the BIggest ContRIBUtIon to yoUR Cost IMPRoveMent PRogRAMMe In 2012/13?

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While most trusts identify service redesign as key to delivering their CIP, our discussions

indicated little evidence of worked-up plans.


Rating the ways to reach CIP targetsWhile headcount and pay remain crucial factors, service redesign and partnerships emerge as key to long-term achievement

When asked to rate the contribution of specific measures to achieving CIP targets over the long term, reduction in workforce numbers and pay across the organisation remain significant for most trusts. Some 27 out of 33 respondents said that headcount reduction would be making a major contribution, while 29 said that reduction in average pay would make a major or modest contribution.

These reductions would be expected given that pay costs account for approximately 70% of costs on average at provider trusts. Reductions in average pay relate mainly to changes in the skill mix of staff as changes are made to the way services are delivered.

Only 18% of trusts saw trust mergers as making a significant contribution to long-term CIP achievement. In fact, 67% saw trust mergers as making no contribution at all, suggesting that most trusts were not considering formal mergers as a solution to delivering their financial savings target.

However mergers and consolidation of specific services are seen as having a significant role. This reinforces other findings in the survey relating to the importance of partnerships. The survey highlighted the need for closer partnership working with community, acute, general practice, mental health, local authority and the voluntary sector. Working collaboratively and streamlining services in partnership with other trusts are viewed as key to driving new efficiencies and savings. Interestingly, there was little evidence of partnering with the private sector.

The survey confirms the importance of service redesign in meeting long-term CIP targets. Some 88% of finance directors expect service redesign to make a major contribution to plans. This underlines a recognition in the finance community that the NHS will need to revise patient pathways – rather than squeezing greater efficiency out of existing ways of working – to meet the scale of the challenge ahead.

hoW IMPoRtAnt ARe the folloWIng MeAsURes In AChIevIng yoUR long-teRM CIPs?

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Reconfiguring services“We don’t use beds in the same way. If we close a ward we can save a million pounds, initially when we closed down two dementia wards the majority of the money went into creating new services, so there was an expansion. Of the couple of million pounds that we took out we probably got one and a half million pounds reinvested. So we actually treat more people now than we ever did in a bed, and it’s better for them.

With the acute services element, we’re going to be doing exactly the same – we call it the acute care reconfiguration. So we’ll ask how many beds do we really need, where are we going to have them, what buildings don’t we need? That’s something that all organisations, certainly mental health, will be looking at.

In terms of IAPT (Improving Access to Psychological Therapies) team services, lots of organisations up and down the country have just absorbed this into secondary care. What this trust has done is to work with the GPs to have our IAPT services sat in their surgeries. We do the same with other areas such as consultants, who will go out to the GPs surgery and meet with people, as do our community mental health team.

We don’t need as many bases. It’s taking infrastructure out rather than people. Obviously once you’ve disposed of the buildings that is a one-off saving. To do something more innovative than that is going to be what we have to face. One example is community working with iPads/Androids, so people don’t have to come to their desk to use their computer; they have the enablement for mobile working. Our younger mental health clientele are very computer literate so you can probably dial them four times a day rather than get in your car, go and visit them and come back. So you have more contact with them. That’s what we’re tending to spread out at the moment.

The other working relationships we have are with people like the Alzheimer’s Society, and with MIND, and we’re going to be doing more of that – they do some of the basic care stuff, possibly a lot better than we can. We would be contracting with them for those services. They are cheaper as a result of them not having the significant bureaucracy and associated costs as a statutory service, therefore, savings can be made. The third sector is happy, we are happy, and many people are significantly better off.”

Mick Rodgers Deputy Chief Executive/Executive Director of Finance, Sheffield Health & Social Care NHS Foundation Trust

In many cases this will involve clinically-led redesign programmes. There could be a role for innovative approaches. For example this could involve greater use (at scale) of telehealth, providing more holistic support and reducing the need for ‘traditional’ appointments and avoiding inpatient stays. Recently integrated acute and community trusts (and mental health and community trusts) could also provide opportunities to move support into community settings, delivering more patient-focused services that could reduce costs in whole system terms.

“While most trusts identify service redesign as key to delivering their CIP, our survey discussions and work with trusts indicate a lack of worked up plans. We believe trusts must make project management resources available to ensure service redesign ideas are converted into robust deliverable plans.”

Clive Mellor, healthcare Advisory Associate Director, grant thornton

Rating the ways to reach CIP targets


Can outsourcing of corporate services deliver savings?Outsourcing of corporate services is often seen as a possible source of savings. Yet after analysis of the costs, many trusts appear unconvinced of the benefits

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Given the priority of focusing resources on frontline activities, interest remains high in the potential to drive value from corporate services. However the survey highlights that NHS trusts have mixed views on the role of outsourcing in these areas. While 40% of respondents had outsourced payroll and 48% had outsourced transport, there was only limited outsourcing in other areas. There seems to have been little appetite to date from many trusts to outsource functions such as finance and human resources.

The reasons behind this retention of services are varied. While some of the estates services would be restricted in outsourcing terms due to established PFI contracts, several respondents interviewed for this report stated that despite ongoing reviews of opportunities there was simply not enough savings to be made in these services.

In interviews, several finance directors suggest that most functions have already been assessed for possible outsourcing or formally market tested. Market testing had often led to the retention of services by the in-house provider, with cost and efficiency often cited as the reasons for selection. In some cases the costs of transfer, including redundancies and system

implementation were seen as prohibitive. In particular some trusts viewed an in-house HR team as essential because of the importance of workforce reduction in meeting the current financial challenges.

“Considering outsourcing in an environment where nothing else is going to change is to miss its real potential. Successful leaders in back office transformation use outsourcing to radically change how their departments work and recognise they are still accountable for how well the overall service supports the wider organisation. Control is not lost, rather efforts are focused on integrating the requirements of the organisation and the service provider. This is as much about changing the way departmental managers and internal customers operate as it is about managing the relationship with the service provider.”

Bill Upton, head of healthcare, grant thornton

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Procurement and services savings“Better procurement has generated in the region of 8-10% of savings for the last two years. This has been achieved by investing in an internal team, focusing particularly on category management. As a large teaching hospital, we have the ability to generate significant savings on our own and in collaboration with other trusts locally.

The trust does not currently have a large number of outsourced services and has ‘in-sourced’ a number of services, including laundry and catering, following the merger of the predecessor organisations in 2006 to utilise spare capacity and ensure a consistent service across both campuses. However, we continue to measure the efficiency of all of all our support service functions and where appropriate will undertake market testing to ensure the best value is achieved.”

David shannon Assistant Director of Finance, Nottingham University Hospital NHS Trust

Can outsourcing of corporate services deliver savings?


Opportunities for outsourcing clinical support servicesOther public sector and NHS bodies remain the central partners in clinical support services such as pathology, radiology and pharmacy

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As our responses show, clinical support services are still overwhelmingly provided in-house, with services such as pharmacy being 93% in-house. However, pathology and radiology are showing greater reliance on other NHS bodies to provide services.

This reliance perhaps reflects the general CIP drive towards efficiencies through better partnerships, creating specialist hubs and reducing duplication of services locally.

Portering and cleaning are services where trusts (30% of the sample) have turned to external providers. Catering follows behind with 5 from 32 trusts having outsourced this to a private company. Portering, cleaning and catering were also provided by the third sector in one case each.

Comments from our respondents indicate that there is, however, some on-going activity in relation to outsourcing, especially in the areas of pathology and radiology. Away from the survey we can see this in the south sector of Greater Manchester, for instance, where there is a review to combine pathology services with savings expected from the early models. In addition, trusts in Leicester and Nottingham have drawn up plans to combine their pathology into the largest department of its kind in the East Midlands. Either public sector alone or a mixture of public and private sector organisations, there are increasing examples of organisations coming together to offer substantial savings in terms of centralising facilities and improving efficiency.

Comments from our respondents indicate that there is activity in relation

to outsourcing, especially in the areas of pathology and radiology.


How CIP schemes have been receivedCIPs can be key drivers of improvement in all areas if done correctly, and our survey finds that trusts have largely avoided any negative impact

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Nearly 60% of respondents said CIPs had led to reductions in staff numbers, and this is reflected in a negative impact on staff morale identified by four out of 10 directors taking part. The fact that 40% said it had not had an impact on staff numbers is surprising. It should however be noted that half of the finance directors said CIPs had not impacted on staff morale and two finance directors actually reported an improvement in staff morale as a result of CIPs.

The relatively positive picture on staff morale suggests staff may respond well to seeing an improvement in efficiency and reduction in waste, with services being more streamlined and focused on patient needs and expectations.

CIPs were understandably seen as having a positive impact on efficiency. However finance directors were split on the impact of CIPs on quality and outcomes with 42% reporting a positive impact and 58% reporting a neutral impact. Some trusts indicated that they had rejected or deferred high-risk schemes.

A number of respondents identified that they had robust procedures for ensuring savings do not have a negative impact on quality, through such means as risk assessments at the earliest possible phase of proposal. These findings reflect earlier work by the HFMA on clinical engagement in provider organisations, which also identified safeguards to ensure service quality was not reduced by cost improvement. As CIPs progress the integrity of these procedures will become increasingly important.

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Hitting long-term financial targets When asked about hitting targets over the next three years, confidence from respondents falls

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Our survey asked respondents to rate the likelihood of their trust achieving their financial targets over the next three financial years. The results show a clear deterioration in confidence in 2013/14 and 2014/15. While 97% thought that hitting the 2012/13 targets was very likely or likely, this reduces to 30% for 2014/15, with the remainder indicating achievement of targets was only ‘possible’.

This is likely to reflect two issues. First, there is greater uncertainty about the financial context for 2013/14 and 2014/15. Finance directors simply do not know what tariff prices and efficiency requirements will be set at. Nor do they know the business rules that will be put in place – for example around marginal rates for emergency work under payment by results or possible readmissions penalties. Secondly, the introduction of new commissioners in the form of clinical commissioning groups will also add to this uncertainty.

However the fall-off in confidence beyond the current year is also likely to reflect the fact that CIP schemes are expected to become more difficult as time moves on. Easier opportunities for savings are likely to have been realised leaving trusts to deliver on some of the longer term, transformational projects.

Respondents mention a number of specific concerns around medium term targets. In particular there are concerns about a loss of education funding and cuts to local authority budgets, with a knock-on impact on the NHS.

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Making a success of CIPs Trusts identify good board awareness and support for CIP schemes but some concerns over manpower levels and capability to make partnerships work

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The survey identified some of the key components for successful CIPs and asked finance directors to rate their own organisations in these areas. Some 73% of respondents said their organisations had good board awareness and support for schemes. Board level buy-in to CIPs is seen as a vital foundation for achievement of targets. Trusts largely suggested that they had the skills within their finance departments to deliver on CIPs. Some 64% of respondents said finance department skills were good. However there was slightly more concern about actual numbers of staff within finance departments to support delivery of the improvement agenda.

The sample was split in identifying clinical engagement in their organisations as either good or average. Perhaps the greatest concern was around collaboration with partners, considering the importance of partnership working to the achievement of better integrated services. One in five respondents said this was poor in their organisations while a further 55% rated collaboration as only average, reflecting the difficulty in enabling effective partnership working. Less than half the sample rated project management capacity as good. Those organisations with average or poor arrangements in place will need to address this if they are to continue to deliver CIPs successfully going forward.

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Using rewards to drive CIPs A variety of divisional incentive schemes are in place across trusts to help achieve targets

Our survey asked finance directors whether their trusts had incentive schemes in place to help drive their CIP targets. Of our 34 trusts, nine have some form of scheme in place, each with a very specific and varied profile.

Some trusts allow greater access to capital for divisions that generate surpluses, while others maintain reserves that can be accessed by divisions proposing proven ‘spend to save’ schemes. Likewise, there are also trusts that have the availability of transformation funds for such things as service developments rather than awarding preferred access to capital.

Respondents also identify CQUIN and Best Practice Tariff funds being reinvested in the division, alongside others who simply allow surpluses to be retained, either in full or as a percentage.

A number of trusts are now discussing the implementation of incentive schemes and it is clear that such incentives may become a valuable tool in driving further savings across the sector. The benefits of incentives are clear, but the difficulty is that these may only be affordable if

trusts deliver their overall financial plan. For some to retain surpluses, for example, while other divisions fail to hit targets is clearly problematic, so future surplus schemes in particular may need to be linked to overall CIP achievement. A creative approach to structuring these schemes is required to balance the needs of incentivising individual service lines and meeting the ongoing CIP targets.

“Incentives are useful but need to be structured on an affordable basis.”


A number of trusts are now discussing the implementation of divisional incentive schemes, and it is clear that such incentives may become a valuable tool in driving further savings across the sector.


The goals of successful CIPs The highest quality care can be the lowest cost care if care is delivered ‘right first time’ and duplication and waste are eliminated. But how do clinical staff view efforts to improve costs?

WhAt Do yoU thInK yoUR ClInICAl stAff see As the MAIn goAl of yoUR CIP PRogRAMMe? (CLINICAL STAFF = DOCTORS, NURSES AND OTHER FRONTLINE STAFF)

To reduce costs To reduce costs and improve quality To reduce costs without reducing quality

Our survey included two key questions about the overall goals of CIPs and the benefits they bring. While overall the responses were positive – from both the points of view of financial directors (see page 15) and how those directors believe their clinical staff feel – more needs to be done about communicating the goals and reasons for CIPs.

This was shown in a question asking what finance directors believed their clinical staff saw as the main goal of the CIP programme. Over half (53%) thought that clinical staff saw the CIP goal as reducing costs without reducing quality – a neutral stance. However, 25% thought that clinical staff viewed CIPs as purely a cost-reduction exercise.

Changing traditional mindsets is, as our respondents commented, a long process. Some remarked that professional bodies greet their CIP schemes with scepticism, and that more work needs to be done to convince staff that efficiency can be delivered while maintaining, or improving, standards. This implies that work needs to be done at the national level to help both staff and professional bodies understand the role of CIPs. Engagement of clinical staff is key to successfully delivering on CIPs, and where this is failing, there may be a direct effect on the long-term sustainability of schemes. High quality services are built on a foundation of robust finances. But it is also the case that trusts that focus on continual improvements in quality appear significantly more successful at delivering ongoing financial savings. The engagement of clinical staff in this process is vital.

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CIP impact and clinical engagement“We’re making sure we look at everything, every opportunity. We’ve had ideas from everywhere within the trust, and even from outside organisations. There isn’t a pound of expenditure that won’t be looked at three times over the next couple of years in terms of whether it is being spent wisely. I don’t think there’s anything novel, however the only thing I would say in terms of our performance management framework is that it has allowed us to drive some additional costs out at the same time as managing quality, performance and workforce targets. If we didn’t have that framework in place I think we may have compromised performance or quality on the back of savings. We’ve been able to sustain performance – improved performance, actually – as well as managing key quality metrics.

In terms of CIP impact on staff morale, there is always concern that the focus remains on finance and savings and this of course impacts on a broad number of our staff. I have no qualitative evidence that there is a direct impact of CIP on staff morale, however.

Clinical engagement is an absolutely critical issue. It’s both the medical staff and broader clinical workforce. We have to develop initiatives for savings that have full support from the clinicians delivering the services and make sure in communicating the challenge clinicians see the importance to them of supporting the savings programme.”

Karl simkins Director of Finance, Royal Cornwall Hospitals NHS Trust

“Those trusts that have a major focus on continual improvements in quality appear significantly more successful at delivering on-going financial savings.”



Additional benefits from CIPsCIPs enable improved clinical engagement and the opportunity to improve both clinical pathways and quality

We also asked finance directors what they saw as the additional benefits derived from undertaking CIPs, apart from reducing costs and meeting financial targets. Most respondents agree that CIPs provide opportunities, as well as challenges.

Directors were almost unanimous in identifying the opportunity to review pathways as a key benefit. Changed pathways can deliver better services for patients – potentially delivering services more proactively to avoid inpatient episodes or delivering different components of care on the same day in the same location to provide greater convenience. The need to find cost improvements can provide an impetus to challenge the status quo and look for opportunities to deliver improvements in both quality and value. It may be that pathways, once reviewed, remain unchanged or merely tweaked. But the act of reviewing can help clinical-financial engagement, which is likely to pay off in other service areas and projects.

Given that some respondents have expressed concern over clinical staff viewing CIPs as simply cost cutting, it is heartening to see that 88% rate the opportunity to engage with clinical staff as a key benefit. From comments made in our survey, it is clear that the majority of trusts have made this engagement successfully as they bring clinical staff into the very process of proposing and assessing schemes.

Engaging clinical teams and improving data quality“We have a good relationship with clinical staff: we have six clinical business units (CBUs) and six clinical directors. All the CIPs are generated at CBU level so we have full clinical involvement. Something else we’ve had for over a year now is a quality steering group, led by the medical and nursing directors and involving the clinical directors and other clinicians, that oversees the process of developing CIP plans, with a particular emphasis on the quality aspect.

Data quality is not a significant issue, but an area we can always improve on. What we’re doing at the moment with the quality steering group is to take existing performance indicators and group them in a clearer fashion so you can see what impact CIPs are having on quality.

You’ll get a quality set of indicators that we can take to the trust board, CBUs, or distribute on a team basis to show what’s happening with regards to these indicators. We can say what’s normal, what’s good or poor, we can see if there’s something happening in regard to quality that we might need to investigate further.

At the moment we have many performance indicators. We’ve got about 270 that we currently monitor, whether that’s through Monitor, or the NHS Performance Framework or the local commissioner frameworks. So what would be helpful is a more concise group of quality indicators.”

David sproson Head of Finance & Performance, Mersey Care NHS Trust

APARt fRoM ReDUCIng Costs, WhAt ARe the ADDItIonAl BenefIts of CIPs?

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A number of trusts use transformation change schemes that stand alongside or replace CIPs. These schemes, according to respondents, create more excitement and engagement in their organisations as they place savings as part of the process of delivering a modern, efficient and successful trust.

One director said a balanced approach was needed on quality and cost improvement. While he accepted that higher quality could mean lower cost, this would not be the case in all circumstances. He suggested that a simplistic adherence to this mantra in all cases risked turning clinicians off.


grant thornton

Grant Thornton UK LLP is a leading financial and business adviser to the public and private sectors. The firm has over 200 partners and nearly 4,000 staff operating from 27 client-facing offices throughout the UK. Our key industry specialisms include the health sector, where we have clients ranging from NHS trusts and foundation trusts to SHAs, commissioning bodies and social enterprises. We also supply consultancy services to Monitor and the Department of Health.

We have a specialist team dedicated to providing robust financial and operational support to our clients, enabling them to focus facing significant challenges in implementing policies and delivering improved patient care. Our commitment to the sector is recognised by winning the ‘HealthInvestor Advisor of the Year’ award in 2009 and 2010 and the LIFT ‘Best Advisor Award’ in 2008 and 2010.

We are a corporate partner of the Healthcare Financial Management Association, regularly contributing to HFMA conferences and training activities, and speaking on issues impact the sector at both a national and regional level.

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hfMA

The HFMA is the representative body for finance staff in healthcare and – for the past 60 years – has provided independent and objective advice to its members and the wider healthcare community. We are a charitable organisation that promotes best practice and innovation in financial management and governance across the UK health economy through our local and national networks. We also analyse and respond to national policy and aim to exert influence in shaping the wider healthcare agenda. We have a particular interest in promoting the highest professional standards in financial management and governance.

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Grant Thornton UK LLP is a member firm within Grant Thornton International Ltd (‘Grant Thornton International’). Grant Thornton International and the member firms are not a worldwide partnership. Services are delivered by the member firms independently. This publication has been prepared only as a guide. No responsibility can be accepted by us for loss occasioned to any person acting or refraining from acting as a result of any material in this publication.

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EPI927

head of healthcareBill UptonT 020 7728 3453E [email protected]

londonPaul hughesT 020 7728 2256E [email protected]

Midlands & eastJon RobertsT 0121 232 5410E [email protected]

Report authorClive MellorT 020 7865 2444E [email protected]

south of englandJohn goldingT 0117 305 7802E [email protected]

north of englandPaul DeverillT 0113 200 1551E [email protected]

For further information on this report and CIPs please contact Bill or Clive, or your regional contact listed below:

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