Carter review publishes details of hospital efficiency plan

Photo of Lord Carter

Lord Carter has called for acute trusts to take a series of steps to tackle “unwarranted variation” in quality and finances, as he publishes the final report of an 18-month review into efficiency and productivity in NHS hospitals on Friday (5 February).

The measures, outlined in a report submitted to the health secretary, include moving to e-rostering systems, adopting ‘model hospital’ standards, prioritising the role of procurement, and working more closely with neighbouring hospitals.

They are designed to tackle the wide disparities in running costs, staff sickness absence and prices paid for supplies and services unearthed by the review.

The report also calls for improvements in staff productivity and a strategy to address the "major problem" of delayed transfers in care.

Taken together, the review’s 15 recommendations could see NHS hospitals save £5bn a year by 2020/21, and help trusts improve performance and patient care.

The headline findings and recommendations for NHS Confederation members to be aware of can be found below. NHS Employers has summarised the workforce implications for the NHS.

The Carter Implementation Programme team, currently working in the Department of Health, will be scaling up and accelerating their work from September 2016 once fully embedded in the new Operational Productivity directorate in NHS Improvement. 

Cost-effective care

“Lord Carter’s work with trusts makes a helpful contribution to the challenge of bringing down costs in hospitals,” the head of the NHS Confederation, Rob Webster, said on Friday.

“Full delivery of the report will provide less than a quarter of the overall efficiencies we are required to make and it is important to recognise the huge scale of the challenge ahead.

“Alongside this work, we will need to keep a focus on system-wide changes that deliver more cost-effective care. Hospitals alone cannot deliver changes required and they will be working on the back of efficiencies achieved in the last Parliament."

Case studies

The NHS Confederation will soon launch a new project bringing leaders together to share learning on ways to deliver better value. The organisation is keen to gather case studies that demonstrate how members are making savings, for example in different ways to procuring goods.

If you would like to be involved in this work, please email Emma Paveley at

View the ‘related links’ on the right-hand side of this page for ways members are already making strides on Carter-related recommendations, including pathology transformation, innovative supply chain management and clinical involvement in procurement. 

The findings

The review looked at productivity and efficiency in English non-specialist acute hospitals, using a series of metrics and benchmarks to enable comparison. It found “significant unwarranted variation across all of the main resource areas”.

Findings include:
  • Average running costs for a whole hospital (£/m2) vary starkly at different trusts starting at £105 at one trust and going as high as £970 for another.
  • Infection rates for hip and knee replacements vary from 0.5 to 4 per cent – meaning you’re eight times more likely to contract an infection at the worst trust, compared to the best. 
  • Prices paid by different hospitals for hip replacements vary from £788 to £1,590. 
  • The use of floor space varies significantly with one trust using 12 per cent for non-clinical purposes and another using as much as 69 per cent.
  • Sickness and absence rate vary from 3.1 per cent to 5 per cent – meaning staff are 60 per cent more likely to be absent due to sickness at the worst trust compared to the best.

The recommendations

The report makes 15 recommendations, supported by a series of steps to achieve them. They are aimed at NHS acute trusts, NHS Improvement and other national bodies.

“We have placed a heavy responsibility on NHS Improvement to manage the delivery of these savings, but it’s imperative that all of the national organisations work together and we want to make it absolutely clear that trust boards should be held to account,” the report says.

Recommendations of note to NHS Confederation members include:

  • All trusts to use an e-rostering system, implementing the following practices:
    • an effective approval process by publishing rosters six weeks in advance and reviewing against trust key performance indicators, such as proportion of staff on leave, training and appropriate use of contracted hours
    • setting up a formal process to tackle areas that require improvement, with escalation paths, action plans and improvement tracking 
    • developing associated cultural change and communication plans to resolve any underlying policy or process issues.
  • Trusts to implement the guide on enhanced care (previously referred to as ‘specialising’) by October 2016, which will be monitored by NHS Improvement, using an approach developed by them as an improvement priority.
  • Trusts to develop plans, by April 2017, to ensure hospital pharmacies achieve set benchmarks, such as increasing pharmacist prescribers, increasing pharmacist prescribers, e-prescribing and administration, accurate cost coding of medicines and consolidating stock-holding by April 2020.
  • Trusts to ensure their pathology and imaging departments achieve their benchmarks as agreed with NHS Improvement by April 2017.
    • Trusts to introduce the Pathology Quality Assurance Dashboard (PQAD) by July 2016.
  • Trust to report their monthly procurement information to NHS Improvement, to create a NHS Purchasing Price Index beginning in April 2016; to collaborate with other trusts and NHS Supply Chain with immediate effect; and to commit to the Department of Health’s NHS Procurement Transformation Programme (PTP), so that there is an increase in transparency and a reduction of at least 10 per cent in non-pay costs is delivered across the NHS by April 2018.
  • Trusts to ensure unused floor space does not exceed 2.5 per cent; floor space used for non-clinical purposes does not exceed 35 per cent; and expenditure on administration should not exceed 7 per cent by 2018 and 6 per cent by 2020.
  • Trusts should have the key digital information systems in place, fully integrated and used by October 2018, and NHS Improvement should ensure this happens through the use of ‘meaningful use’ standards and incentives. 
  • Trust boards to work with NHS Improvement and NHS England to identify where there are quality and efficiency opportunities for better collaboration and coordination of their clinical services across their local health economies, so that they can better meet the clinical needs of the local community.
  • Trust boards ensuring that the Electronic Staff Record (ESR) is reconciled to the financial ledger on a weekly basis, with a minimum reconciliation of 95 per cent from October 2016.

Find out more

Download the report from the Department of Health website and view the NHS Confederation's press statement.

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