Agenda item

(To receive a report from Jan Sobieraj, Chief Executive, United Lincolnshire Hospitals NHS Trust and Karen Brown, Director of Finance, United Lincolnshire Hospitals NHS Trust, which provides the Committee with an update on the support packages that have been put in place to assist the Trust develop a recovery plan to exit Financial Special Measures)

The Committee gave consideration to a report from United Lincolnshire Hospitals NHS Trust, which provided information on the number of support packages that were in place to assist the Trust in developing a recovery plan to exit Financial Special Measures.  It was reported that a draft recovery plan had been developed and submitted to NHS Improvement (NHSI).  The plan's main aim was based on making current services more efficient and effective.   

The Chairman welcomed to the meeting Jan Sobieraj, Chief Executive, United Lincolnshire Hospitals NHS Trust and Karen Brown, Director of Finance, United Lincolnshire Hospitals NHS Trust.

The Committee was reminded that an additional paper entitled Quality and Safety Report for October 2017 had been circulated by email to all members of the Committee on 2 November 2017, a copy of the said document was tabled at the meeting.

The Committee received a joint update from the Chief Executive, United Lincolnshire Hospitals NHS Trust and the Director of Finance United Lincolnshire Hospitals NHS Trust, which brought the Committees attention to the table on page 21, paragraph 2.5 which described the main elements of the Trust's structural deficit of £70m; and provided a breakdown of the £70m as follows:-

·         Duplication of services across multiple hospitals         £30m

·         Use of agency staff                                                                        £13m

·         Loss of elective (planned) work                                       £13m

·         ULHT inefficiencies                                                                       £14m

The Committee noted that the Trust had not achieved             a breakeven position since 2011/12; and that the graph detailed on page 21 identified the levels of deficit since that time.  Reference was made to the increased costs of delivering and investing in services over the Trust's three main sites; and that the large geographical area of Lincolnshire had not assisted the Trust in delivering the national efficiency agenda.  It was noted that the projected budget deficit for 2017/18 of £75m allowed for investment for quality of care in the future.

It was reported that to exit financial special measures three elements were required, which included a robust recovery plan, which needed to be approved by the ULHT Board and NHSI within one month; and also the production of a detailed delivery plan providing evidence of significant efficiencies within a further two months' timescale.  It was highlighted that the NHSI might also require evidence of delivery over a further three month period; and the implementation of further actions as detailed at paragraph 4.2 of the report.  It was highlighted further to the Committee that there was some recognition from the NHS and NHSI that there needed to be a more co-ordinated approach to commissioning services.

During discussion, the Committee raised the following issues:-

·         One member asked for an explanation of the word 'structural deficit'.  It was explained that the term structural deficit referred to a long-term mismatch between income and expenditure.  The Committee was advised that there was a balance between exiting financial special measures and delivering quality; and as a result the recovery plan needed to be balanced so that it did not affect the quality of care being provided;

·         One member enquired when the Trust's circumstances would improve.  There was acknowledgement that more efficiencies could be delivered and that the Sustainability and Transformation Partnership would help reduce some of the inefficiencies by remodelling some services, for example by reducing the number of people unnecessarily admitted to hospital and the introduction of Neighbourhood Teams would assist in this.  The implementation of the model would ensure that a better service was provided for patients within their communities. Remodelling would also help reduce the number of people attending A & E when it was not necessary, this would also help in attaining more efficiencies;

·         A question was asked as to whether the Trust knew how much funding was required in order for it to deliver a quality service.  The Committee was advised that the Trust's overall budget was £440m; and that the deficit was approximately 16% of that total – one of the highest in percentage terms in the country.  It was noted that some work had been undertaken on zero based budgets, however, budgets in the NHS were not calculated in that manner, they were calculated on the basis of the tariff for a particular patient episode multiplied by the volume of patient episodes;

·         A question was also asked as to whether there was a contingency for the Trust to remain within budget.  The Committee was advised that United Lincolnshire Hospitals NHS Trust was contracted to provide care; and could not therefore refuse to provide that care to the residents of Lincolnshire;

·         The Committee was advised that the loan to the Trust from the Treasury had been charged at a rate of interest between 1% and 1.5%.  It was noted that as a result of financial special measures the loan rate automatically increased to a rate of 6% which had caused an extra cost pressure of £400,000.  The Committee was advised that the reason for the increased rate was to encourage the Trust to move out of financial special measures more swiftly;

·         The Committee noted further that fire safety had also been an issue, as the Trust had had been investing £2.5m a month to improve fire safety at its hospitals;

·         One member asked whether any work had been undertaken on the estimated costs of reducing the services from three sites to two.  The Committee was advised that no work had been done to estimate the costs of reducing from three to two sites.  It was noted that if there was a change in service, the Trust would have to decide where to replace the activity.  It was confirmed that the three sites were required by the Trust, however, reconfiguration of some services might need to be considered;

·         The impact of Brexit with regard to agency staffing – The Committee was advised there had been some impact on staffing numbers; it was noted that nationally the number of European workers had reduced.  It was reported that the Trust's permanent staff rates had improved;

·         The situation regarding Delayed Transfers of Care (DTOC) – The Committee was advised that as a result of close working between health and social care, DTOCs were not a significant issue; and that the current position was at 3.5%;

·         The need for more positive communication – Some members of the Committee felt that the Trust needed to promote the services it provided successfully better.  A further point raised was whether the NHS could promote locally and nationally the impact to the NHS of patients missing appointments.  The Committee was advised that the Trust had a Communication Plan, but acknowledged that there was more that could be done;

·         A suggestion was made for the Trust to join the campaign for Fairer Funding for Lincolnshire.  The Committee was advised that the Trust was more than happy to support for Fairer Funding for Lincolnshire;

·         Turnaround Programme – Page 23 of the report provided the Committee with details of a high level financial turnaround programme.  It was highlighted that key themes of the plan were to reduce the costs of delivering services through several initiatives, and to ensure that the level of service provided to patients was not affected.  The Committee was advised that the Trust had engaged with staff and the public regarding ideas to help the Trust reduce wastage and develop new service going forward.  To date, the Trust had received over 1,200 savings ideas, all of which were being considered and would be included in the Trust's plans, as part of the 2021 vision.  It was highlighted that anyone could make a suggestion through a generic email address.  The Committee received a short explanation of some of the themes.  Page 24 of the report provided a description of each of the themes;

·         Quality Impact Assessment – The Committee was advised that all efficiency schemes were subject to a full quality impact assessment (QIA) signed by the Medical Director and the Director of Nursing to ensure that quality was not being reduced.  It was noted that the QIA had not been yet been completed on all schemes, and that this might affect some of the content of the final plan.  The Committee was advised that the reason for QIA was to ensure that any decision taken with regard to finances did not affect the quality of care provided by the Trust.  It was noted that the Trust was in deficit each month by £6m.  Out of the £18m (turnaround figure), £6m still had to be go through QIA;

·         Role of the Modern Matron – The Committee was reassured that matrons were frontline staff.  The Committee was advised that a golden hour had been introduced each day where heads of nursing and matrons set aside time to do structured checks of wards to check the care being provided to patients to ensure that each area of the hospital was providing the same high quality standard of care; and

·         Catering provision – The Committee was advised that following an independent survey concerning catering provision; the level of satisfaction had increased.

In conclusion, the Committee agreed to receive the information presented on financial special measures and to updates being presented each quarter.

The Chief Executive United Lincolnshire Hospitals NHS Trust advised the Committee that owing to the levels of specialist nurses available, paediatric services were extremely fragile at the Lincoln and Boston sites.  Reassurance was given that although the service was fragile it was operating safely at the moment.

RESOLVED

1.    That the update from United Lincolnshire Hospitals NHS Trust concerning Financial Special Measures be received.

2.    That quarterly progress reports be received by the Committee.