Financial sustainability of NHS Foundation Trusts in England five years after the enactment of the Health and Social Care Act of 2012

Abstract

Background/Aims The enactment of the Health and Social Care Act (2012) led to significant structural changes in how hospital services are commissioned and has introduced direct competition with the private sector. The aim of this study was to assess the impact of the act on the financial position of the Shelford Group of NHS Trusts, 5 years after the act's enactment. Methods The levels of clinical activity, annual accounts and statements of financial position produced by the 10 Trusts for the financial years 2010/2011 to 2017/2018 were examined. Findings The key financial indicators for each organisation were collected. Key financial indicators for the period just before the Act were compared with the corresponding values for the period of 5 years after the enactment of the Act. The Shelford group of NHS Trusts provided 15 047 304 patient care episodes in 2017/2018, which represented a rise of 6.34% over 5 years. This was a significant slowdown in clinical, which had grown by 18.57% in the 4 years immediately before the act. There were no significant differences in the mean operating surplus returned by the Shelford Group in the 5 years after the Act, compared to before its implementation. The median cost of finance for each organisation increased by 35.4% from £18 245 000 to £24 703 000. The total capital employed remained static over the 5 years following enactment of the Act. There were no significant differences in levels of liquidity and leverage of the Shelford Group in the 5 years after the Act compared to before. Conclusions The financial position of the Shelford Group of Trusts has not been adversely affected by the Health and Social Care Act (2012) , although there was some evidence that the operational finances of these NHS Trusts were less robust in the 5 years following the Act.