News Roundup [abridged Versions Appear In The Paper Journal]

Trusts to be graded by finances as well as quality of care

BMJ 2006; 332 doi: (Published 16 March 2006) Cite this as: BMJ 2006;332:626
  1. Andrew Cole
  1. London

    NHS trusts that overspend, even by only a few hundred pounds, will be heavily penalised under the annual “health check” that replaces the old star rating system this autumn. The Healthcare Commission, the NHS's inspection body, announced this week that trusts will receive two separate ratings, one for quality of care and one for financial management. And, the commission made clear, overspending will not be tolerated. The tough new approach follows growing concerns about the current state of the NHS's finances, with a record overspend predicted by the end of the financial year.

    Under the health check, trusts will be rated on a four point scale, from weak to excellent. The commission's chief executive, Anna Walker, emphasised that any trust in deficit would find itself at the bottom of the scale and was likely to be subject to regular performance monitoring. It would also be barred from applying for foundation trust status. “It will face closer scrutiny from us because we will be watching like a hawk throughout the year for any impact on care of patients,” she declared.

    Quality of care and finance were “two sides of the same coin. If financial management is poor then patients will eventually pay the price because services will suffer.” With the former system of star ratings, poor financial performance could sometimes be disguised because it was only one of many measures that made up the overall rating. This would no longer be possible under the new system. “There is no room for overspend,” a spokeswoman stressed. She added that the decision to split the rating in two had been the commission's and had not been dictated by ministers. “It was our advice and the Department of Health agreed.”

    Health secretary Patricia Hewitt stressed that the quality of the service was what mattered most to patients. But these arrangements would help to get best possible value for money. “By using every pound of public money as effectively as possible we release more resources for new drugs, better prevention, and faster treatment.”

    The chief executive of the NHS Confederation, Gill Morgan, welcomed the greater transparency offered by the new system but warned that it would be “very challenging for many NHS organisations given the current climate.”

    Under the new health check, the commission plans to inspect only a fifth of all trusts each year, relying largely on declarations by the trusts themselves, which will then be checked against patient surveys and the views of local bodies. This year's declarations have to be submitted by May.

    The commission is now consulting about the shape of next year's health check, which will focus more on how trusts have improved their services and not simply performance against core standards and government targets. Responses must be in by 5 June.

    For full details of the consultation see

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