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NHS price cap guidance: Risks and Doubts

Consider the following statements from a recent report about NHS price cap guidance:

“Proposed price caps could deliver savings… of £370 million under a 55% cap. It is important to note that there is a significant margin of error around these estimates.”

“Without the proposed mitigation, the policy would carry very high risks of creating staff shortages, which in turn would lead to increased risks to patient safety and to the quality and continuity of services, including increased waiting times.”

“There are significant economic risks to using price caps, such that economists will not, under most circumstances, advocate their use”

“Price caps may reduce the supply of agency shifts, leading to staff shortages. This could lead to risks to patient safety and clinical quality, and to performance and patient access. This may be experienced more acutely in particular trusts or in particular specialties.”

“there is a general risk that price caps will, in fact, become the default prices in each market affected”

“The greatest difficulties are likely to be faced by challenged trusts, especially those formally in special measures and/or subject to CQC compliance/enforcement actions related to staffing. Experience suggests that, particularly as a result of adverse reputational issues affecting their ability to recruit substantive staff, such trusts often rely on agency staff to maintain continuity of services, and that those agency staff have usually required a significant premium to take on such roles.”

“There is a further risk that costs may increase overall, if trusts respond to price caps by significantly increasing the wage rates of all staff, including substantive staff, potentially through increased use of overtime.”

The author of the report? Monitor.

Read it here: https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/468469/Impact_assessment_-_agency_rules.pdf