Though the government has promised to maintain real-terms spending on the NHS, healthcare managers are under severe pressure to find savings, in order to find room to cope with growing demands for care and the costs of the massive reorganisation the government has pushed through.
Attention turns to ‘productivity’. Sir David Nicholson, chief executive of the NHS Commissioning Board, has demanded NHS trusts in England find £20billion worth of productivity gains. They do more, keeping costs the same or cut costs while doing the same.
But what the NHS does is not straightforward. Its ‘product’ is more than a count of the number of times we visit a GP or how many NHS prescriptions chemists dispense. The trouble is, once you move away from these crude measures the data supply runs out. Measuring patient satisfaction is difficult enough; it’s hard indeed to match treatment and general health or subsequent illness.
No wonder, then, that official statisticians have found NHS productivity a quandary. A decade ago, the Office for National Statistics hit the headlines for suggesting NHS productivity was falling – which seemed to fly in the face of the experience of both the public and politicians at a time when NHS spending was rapidly rising.
Several revisions later, ONS work on health service productivity suggests that it may instead have been rising, with some signs of levelling off in the two years before 2010, the year when the latest analysis ends.
This is not the last word. The statisticians admit they can’t measure many of the things that people experience as healthcare – care and compassion being obvious examples. They can’t yet count the contributions made by local authorities and voluntary organisations and are only now incorporating some effects on ‘output’ from NHS contracts with private firms.
For the moment, the official finding is that public healthcare productivity rose 0.4 per cent a year in the 15 years to 2010. This is a lot more than the annual decrease of 0.2 per cent that ONS was calculating as recently as 2011. The revision stems partly from incorporating more data on the quality of healthcare but also more on what health spending actually bought by way of drugs, treatment and so on.