Welcome to the most exclusive club in the NHS

Action on nursing

Separate meetings are held by the medical directors, the finance director, and the chief nurses from the 10 trusts, focusing on their particular areas of expertise. “Take the nurses’ group as an example,” said Naylor. “There’s pressure in the NHS to set a nursing ratio—one nurse to every seven patients, say—but our view is that there shouldn’t be such a fixed ratio. A paediatric cancer ward, for example, needs twice as many nurses as a geriatric ward. Life is not simple; you have to look at acuity [level of medical need]. You might have 30 patients on a ward, and six require one-to-one care, so you can’t say you need six nurses to look after 30 patients; you need six just to look after the six.”

The nurses’ discussions have revived a product first created in 2007 and originally supported by the Association of UK University Hospitals, the Safer Nursing Care Tool. This is a data collection system that enables nurses to assess the acuity and dependency of patients on their wards in order to calculate the staff needed to meet patients’ needs. This tool has proved very useful, according to Moore. “People have tried very many ways to work out how many nurses you need, but it has to be based on the type of patients and how dependent they are, and it varies from time to time. The acuity of patients has gone up and up; you tend to forget how different it has become.”

In its response to the Francis report on Mid Staffordshire, the government held back from setting mandatory staffing levels for nurses but said that trusts must conduct six monthly reviews of staffing, to be made public and monitored by the Care Quality Commission.1 In a letter to the Times newspaper published on 21 November the Shelford chief nurses group urged the use of the tool to determine what staffing levels should be.2 The group’s intervention seems to have been timely and influential.

Fight for extra money

More controversial, perhaps, has been the claim made by the group that specialist academic hospitals are disadvantaged by the tariff under which providers are paid for each episode of care. The group believes that the tariff under-rewards specialist hospitals because their patients are likely to be more ill, require more complex care, and have higher costs. In London a group of specialist trusts won the argument for a top-up payment under a scheme called Project Diamond, and NHS London handed out £40m in 2010-11 and a further £50m in 2011-12 to make up for the tariff’s failure to fully account for these extra costs. Although NHS London no longer exists, payments are expected to continue through NHS England, the commissioning body for specialist care.

Naylor said: “Most major developed countries do the same, adding a percentage to the tariff. In the long term it should be possible to make the tariff more sophisticated, but there’s no example in the world that we could find that’s cracked it.” He added that there was “a very strong opinion” in the Shelford Group that the London solution should also apply to hospitals outside the capital. Cash, in Sheffield, went further, arguing that the tariff problem was one of the two main reasons for setting up the group in the first place (the other being benchmarking). He cited the example of care for rectal cancer, where a study at Sheffield had found that the trust was losing 40% of the tariff price for every case it treated.

“But we did feel it was tricky making the case for extra money,” he said. “It’s got to be based on strong evidence rather than being caricatured as whingeing by academic hospitals. It’s not big money, this, maybe £30-50m a year. We don’t know how much it would be, and it has to be calculated independently. We need to look at each portfolio and write off losses against gains, and we want that independently verified by the tariff team and by outside consultants.” The Shelford Group made a submission two months ago to NHS England for the extra funding, he added, and it was under consideration.

Moore agrees that an uplift is justified but seems sceptical that one will ever be granted. “Specialist hospitals don’t treat typical patients,” she said. “If we operate to repair a hernia, it’ll be in a patient with diabetes, or a transplant recipient, or whatever. We’re a trust of last resort. The tariff is quite crude—in most other places in the world specialist hospitals receive extra resources. They get it in London but the rest of us are struggling on. We need a Project Diamond outside London.” Are you getting anywhere with it? “No, we’re not getting anywhere with it, and I don’t think we will.”

The group has lobbied hard for the extra cash ever since its inception—a letter to the Financial Times in late 2011signed by the 10 chief executives and claiming the tariff shortfall would be £400m that year was one of the first times the group put its head above the parapet.3 At the time, the group was lobbying the Department of Health and the Treasury along the same lines. In a pitch calculated to appeal to the Treasury, the group argued that the shortfall in funding could lead to clinical trials in the UK drying up, with “long-reaching implications for employment, exports and the economy.”

The argument hasn’t gone uncontested. Critics point out that specialist hospitals actually earn a far lower proportion of their income from the tariff than do other trusts, with a much higher proportion coming from off-tariff specialist contracts. Guy’s and St Thomas’ NHS Foundation Trust, for example, the foundation trust with the biggest income in 2010-11, earned just £196m of its total £953m from the tariff. The same applies, to a greater or lesser extent, to other members of the group. In addition, Shelford Group hospitals receive more in long stay payments under the tariff, as well as other top-ups such as the service increment for teaching (SIFT), the market forces factor (which favours London hospitals in particular), charitable contributions, and research funding.

Just elitism?

I asked Naylor what he said to critics who complained that the group represented big successful hospitals and that they didn’t need any more. “You have to educate them,” he replied.

But he acknowledged that the cost efficiency targets being imposed on the NHS were a bigger challenge to district general hospitals than to teaching hospitals. “They’re stretched both ways. They’re told to discharge patients quickly back to the community and pressed to refer specialist activity to fewer, larger places. So they’re pulled in two directions. There are major financial problems there.”

The 10 trusts that form the group are not the only important tertiary centres in England, so how did the membership come about? Is it an exclusive club, or can others aspire to join? Naylor said membership had been determined by a mixture of objective and subjective criteria. According to Moore, the objective element included some metrics created by Price Waterhouse Coopers, which took into account size, quality, research, and teaching. “There were several other trusts that didn’t meet the metrics, so they fell out,” she said. “Two of the member trusts are not foundation trusts (Oxford and Imperial), but they scored highly on quality metrics and so made up for that.”

All three chief executives who spoke to me agreed that personal chemistry between the 10 had been important—“we like each other’s company,” said Moore. She said that the group was anxious not to duplicate the work of any other body. “There is the UK Association for University Hospitals, but it has more than 40 organisations in it—everyone teaches now—and it’s a UK-wide organisation, while we’re England only. And there’s the Foundation Trust Network, but we’re not all foundation trusts. We’ve had meetings with both organisations and we remain members of them, if we were before. We think 10 is about the right number for what we want to do.”

Asked if there is a parallel with the Russell Group of universities, Naylor didn’t dissent. “Like the Russell Group, we’ll probably grow in time, but we wanted to establish ourselves first. We’ve had many debates about expressing our opinions publicly, and there’s increasing interest in that. But we’d rather influence policy behind the scenes than through the media. People might say ‘Oh, they’re a self-interest group, they would say that.’”

In an NHS that is supposed to be run by general practitioners through clinical commissioning groups, the big providers getting together might be seen as a reactionary response. But whatever the theoretical source of power in the NHS, hospitals have always proved adept at pulling the strings, and none more so than the big teaching hospitals. This can get people’s backs up, as the more colourful accusations hurled under the cover of anonymity in Health Service Journal make clear: “elitist claptrap indicating that we’re most certainly not all in this together,” . . . “arrogant pompous organisations,” . . . “the epitome of those organisations who have attempted to grow their way out of the economic downturn creating chaos around them,” to quote a few of them.

Do the charges stick? As long term survivors in NHS management where the average duration of a chief executive’s survival is only two years, the Shelford Group’s leaders are certainly a self confident bunch but do not come across as arrogant. “We represent a very senior cadre of leaders in the NHS,” said Cash. “On 1 April 2013, when the health reforms were implemented, we lost some senior people with the demise of the strategic health authorities, so the Shelford Group is seen as an alternative source. We can deliver change, but also provide calmness.”

After a selection procedure, the group has contracted the market oriented think tank Reform to help project its message. Reform’s director, Andrew Haldenby, said he was delighted and proud to have been chosen. The first step was to talk to all the chief executives and write a report outlining common issues; the second will be two cross-party conferences next year, the first on 14 March on the future provider landscape at which both Jeremy Hunt and his shadow, Andy Burnham, have agreed to speak.

Big ambitions

Reform’s report on the group, which has yet to be discussed by its members, starts with a conclusion none of them is likely to dispute: “The Shelford Group is a unique resource that should be a valuable support for policy makers in the rest of this parliament and beyond.” It identifies the subject of greatest current importance as integration of care. Here the group can compare the experience of hospitals that did and didn’t take over community care under the last government’s changes. In evidence to the health select committee the group showed that its members that run community care were better able to manage pressure on emergency departments. Moore singles out Newcastle upon Tyne Hospitals NHS Foundation Trust and Central Manchester University Hospitals NHS Foundation Trust as good examples, lamenting meanwhile that her own area, Birmingham, has a fragmented system: “I’d like to see a lot more coming together of acute and community care,” she said.

Nearly all the Shelford Group hospitals have grown large by merger, some by successive waves of mergers. Their size provides security. But are their territorial ambitions sated? Privately, some of the group’s chief executives have been heard to argue that they could run the entire local health economy better than the present incumbents do. That’s quite possibly true, but those I spoke to on the record were more circumspect, emphasising cooperation rather than takeover as the pattern for the future. “There are too many hospitals in the NHS,” said Moore. “Lots are not big enough. But we don’t want to lose them—it’s better to keep them alive but in a different way.” She suggested that combining backroom functions such as human resources and information technology could provide savings.

In London, where there is a hospital on every corner, more radical change is likely. “The NHS is in a state of disarray, uncertainty, and challenge,” said Naylor, who has argued that it was a mistake to entrust GPs with commissioning and favours “end to end” healthcare for London with six to 10 providers offering a fully integrated service and patients free to choose which of the competing providers to join. But this is not Shelford Group policy—Cash said that, unlike Naylor, he supported the commissioning role of GPs and was encouraged by the reforms.

So it would be wrong to see the group as monolithic or driven by ideology. Some of its chief executives are empire builders, no doubt, but others are more tractable and cooperative. What is clear is that the NHS in England has a powerful new player whose views are already heard and are likely to become more influential with time. Safe harbours are especially attractive when the waters are choppy.