NHS budget cuts threaten adoption of new technology

Nuffield Trust report urges trusts to invest dwindling budgets in ground-breaking equipment

There are fears budget cuts could be affecting NHS procurement of new technologies

Cash-strapped NHS trusts are being urged to take an early hit by investing money in new medical technologies in order to reap the benefits from improvements in performance and patient outcomes in the future.

A new report from health think tank, The Nuffield Trust, admits that NHS organisations will have to make tough decisions in order to meet the Government’s £20billion savings target over the next four years.

Technical change is the most important determinant of improvements in healthcare and hospital productivity in the medium to long term

But it urges commissioners to be forward-thinking and embrace state-of-the-art equipment, despite growing pressure on capital within the system.

The report, entitled Can NHS Hospitals Do More With Less? was written by Jeremy Hurst and Sally Williams and is part of The Nuffield Trust’s Quest for NHS Efficiency Programme .

Based on feedback from NHS executive managers and clinicians, and by reviewing literature, it looks at how trusts can meet the efficiency challenge through changes in staff performance, process improvements and estates rationalisation.

It states: “At a first glance, the omens for making such efficiency savings do not look good. The NHS can boast many achievements in recent years, but until very recently increased productivity was not one of them.”

Key to improving performance in the new landscape, it claims, will be understanding the impact new technology can have.

It adds: “Technical change is the most important determinant of improvements in healthcare and hospital productivity in the medium to long term.

Even when NHS purse strings are being tightened, there are likely to be opportunities to enhance outcomes and reduce costs by speeding up the adoption of affordable new technologies

“Even when NHS purse strings are being tightened, there are likely to be opportunities to enhance outcomes and reduce costs by speeding up the adoption of affordable new technologies.”

But it acknowledges that, for many trusts, the high costs associated with ground-breaking new technologies can threaten widespread adoption and, in turn, a trust’s ability to compete in what is becoming an increasingly open marketplace.

It states: “It is often difficult to find opportunities to reduce costs with the newest medical advances because such advances extend treatment possibilities and most are introduced at premium prices. Nevertheless, some new technologies can lower costs if resources are fully released from displacing older ones and, as others mature, their cost effectiveness often improves, sometimes sharply, as when pharmaceutical patients expire.

“It is important to try to introduce new, cost-saving technologies quickly and to try to find budgetary room for those which are highly cost effective but mildly cost increasing.”

An important question arising from the situation facing the NHS in 2010 is whether increased financial pressure in the future will tend to slow the rate of adoption of new, cost-effective technologies, inhibiting potential improvements in productivity. All other things being equal, the answer to this question is likely to be ‘yes’

Even when technologies appear to be affordable, the report claims, the rate of diffusion can be slow and varies significantly across organisations in the UK and between different countries. For example, the first trials of day surgery for hernia repair were carried out in the 1950s, but the NHS Institute for Innovation and Improvement was still forced to recommend surgeons use the approach as recently as 2009.

Reasons for slow diffusion include waiting for prices to fall, a lack of expertise in the new technology, difficulty releasing ‘fixed’ resources dedicated to older technologies, and the presence of liquidity constraints. Habitual behaviour of staff and a reluctance or inability to learn new skills is also blamed.

And the report predicts the situation will be exacerbated further by continuing cuts to NHS budgets. It states: “An important question arising from the situation facing the NHS in 2010 is whether increased financial pressure in the future will tend to slow the rate of adoption of new, cost-effective technologies, inhibiting potential improvements in productivity. All other things being equal, the answer to this question is likely to be ‘yes’.

Tightening the health budget will raise the cost-effectiveness threshold for assessing any new technology, potentially squeezing out of consideration some new technologies

”Tightening the health budget will raise the cost-effectiveness threshold for assessing any new technology, potentially squeezing out of consideration some (marginal) new technologies. Also, a tighter budget will make it more difficult to afford any medical advances that will add to expenditure.”

Fundamental to protecting investment in technology will be changing staff attitudes to the impact it can have, the report adds. Strategies for addressing this will include increasing the quality of information and education, carrying out peer review and audit, encouraging person-to-person contact, and introducing financial incentives, the authors claim.

This approach has already proved successful in several trusts across England. The report authors spoke to six NHS organizations that were in deficit or barely out of it. Their experiences revealed the significant impact investment in technology can have.

Barnet and Chase Farm hospitals NHS Trust and St Helens and Knowsley Teaching Hospitals NHS Trust both procured robotic dispensing systems, which have enabled patients to be discharged faster by reducing waits for medicines to take home, reducing dispensing errors, and releasing pharmacy staff to spend more time on wards. The latter has also introduced paperless clinics, which are expected to reduce delays for patients, increase safety and save the trust £2m a year recurrently in secretarial costs.

It is important to try to introduce new, cost-saving technologies quickly and to try to find budgetary room for those which are highly cost effective but mildly cost increasing

Elsewhere, Mid Staffordshire NHS Trust and Sandwell and West Birmingham Hospitals NHS Trust have increased the capacity and turnaround times of many blood tests using robots to help analyse 3,000 samples a day.

Another forward-thinking organisation is Mersey Care NHS Trust, which has invested in a Potchi machine to perform a blood test in a community setting. It delivers results and a prescription within three minutes where previously this would take a week. The trust has also procured automated drug cabinets on wards, increasing the availability of medicines and strengthened safety.

But, possibly most importantly, managers at Mersey Care are using a Dragon’s Den-style approach to considering any proposals to invest in new technologies and clinicians have undertaken social enterprise training to hone their skills at pitching new technologies. Staff are further encouraged to support new technologies through a multi-disciplinary group called Breathing Space, which enables those with an entrepreneurial streak to explore new ideas and to learn from other sectors.

The Nuffield Trust report says: “The topic of disseminating innovations in healthcare has been reviewed exhaustively under Department of Health auspices. They eschew formulaic, universally-applicable recommendations for practice and policy. Rather, they stress the contingent and contextual nature of dissemination and highlight remaining gaps in knowledge about the process of diffusion.”

But it adds: “Current NHS operating frameworks envisage that some of the efficiency savings that will be required over the next few years will be ploughed back into the NHS, which should allow for some additional adoption of new, cost-effective technologies.”

Click here to read the full report

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