Does the NHS have a productivity problem?

Too many targets, too little capital spending

Black says part of the problem lies in the current confusion about what hospitals should be focusing on amid the welter of objectives and targets. He contrasts this with the years of Tony Blair’s Labour government, “when chief executives were told from the centre unambiguously that they had a small number of critical objectives and their careers were at risk if they did not show some improvement. The waiting list was one and emergency care performance was another.”

Just before Christmas Pritchard sent a letter to trusts and integrated care boards saying that NHS England would be coming up with a standard set of minimum productivity measures.5

A lack of capital spending, leading to everything from a shortage of scanners to dilapidated buildings, is routinely cited as a major cause of NHS productivity problems. While it has now recovered to £10.4bn for the coming year, capital fell as low as £5.1bn in 2016-17 during the six years that capital budgets were raided to support day-to-day spending.6

Anita Charlesworth, Health Foundation director of research, says capital funding in areas such as diagnostics “needs to be sustained—it will take time to feed through to productivity improvements.” But digital investment has recently been cut because of short term funding pressures, which she describes as “textbook ‘penny wise, pound poor’.”

Saffron Cordery, deputy chief executive of NHS Providers, describes the lack of long term capital investment as “probably one of the biggest underminers of productivity,” giving the example of how something as simple as an antiquated air conditioning unit breaking down can put an operating theatre out of action for weeks.

She also points out that around 60-70 days have been lost to industrial action, “a significant distraction from the task at hand, which has had a massive impact on what trusts have been able to deliver.”

The pandemic effect

Charlesworth also highlights the impact of the pandemic. “Office for National Statistics estimates suggest productivity fell by about a fifth during the pandemic. It is now improving, but it’s probably about 5% below pre-pandemic levels.”

There are also differences between services. GPs have managed to recover relatively quickly because they have been able to flex their supply more easily, such as by using remote consultations. From the low point of GP appointments in June 2020 there is a clear trend upwards. The three month rolling average in October 2023 was 31.2 million appointments, compared with 25.9 million in October 2018.7

“The thing that is stuck is inpatient admissions. If you run your system on the edge of capacity you have no resilience to fluctuations, and it takes very little to tip it over. We have more volatility [in inpatient demand] coming out of the pandemic than we did pre-pandemic, and we were already struggling,” says Charlesworth.

That problem is exacerbated by many hospitals still not managing patient flow effectively. Deterioration in older people’s health during the pandemic may also be significant, but the data are not yet clear, Charlesworth says.

She speculates that the absorption of considerably more staff without a corresponding increase in output may in part be explained by wards no longer being willing to operate on the low staff numbers that had become normalised before the pandemic. “It might be that people are saying they’re [not] going back to that, that what they were doing before the pandemic was not safe.”

There is some modest evidence for this, with the nurse care hours per patient day increasing by about 1.6% between October 2021 and October 2023.8 The Care Quality Commission has described understaffing as “a serious risk to staff and patient safety.”9

Some of the extra funding has been absorbed by catch-up pay rises, Charlesworth says—low pay flatters productivity figures.

Lack of analysis, understanding, debate, and trust

Nuffield Trust chief executive Thea Stein is frustrated with the entire productivity debate. She says the quality of discussion is undermined by the lack of trust between the interested parties—“We know, for example, that the Treasury believes the NHS is non-productive. So when the Treasury asks NHS England what’s going on with productivity, what they hear is, ‘You’re lazy, you haven’t really got a grip of this.’ Not the best context for an open, productive conversation.” She sees the same pattern in conversations between NHS England and local providers.

Stein cites the expansion of the workforce as a case in point, saying, “When you bring a lot of new staff into the NHS, productivity goes down as we educate and support them. That’s fine. We need to own it.”

Charlesworth says having the right management skills in the right numbers is key to unlocking NHS productivity. “Experience in other economic sectors shows that big productivity gains from new technology are only unlocked when you also invest in management capacity and capability.”

Stein agrees, pointing out, “We know categorically, looking at world examples, that we are an undermanaged system. We don’t have enough people to do lean manufacturing techniques, system improvement, data analysis, and data checking. Or ethnographic studies hanging out with staff and listening to what’s going on.”

Managers make up around 2% of the NHS workforce, compared with 9.5% of the entire UK workforce.10

People can suddenly find themselves promoted to operational manager without the right skills, training, data, or support. “You don’t quite know what you are doing, so you muddle through,” Stein says.

Among those tackling the productivity problem, Guy’s and St Thomas’ NHS Foundation Trust has been making progress with its high impact theatre initiative,11 where successes include operating on the same number of breast cancer patients in five days that would have previously taken three months.12 It involves using two theatres and three teams, enabling surgeons to go straight from patient to patient.

But while this is described as innovative,12 a similar approach was outlined in The BMJ in 2007.13 It is more than a decade since the King’s Fund publicised the Aravind Eye Care System in India, which quadrupled the productivity of their ophthalmologists by deploying support staff to carry out routine tasks.14 So why haven’t these approaches been adopted across the NHS?

Britnell is sure there are big productivity gains to be had. “Worldwide, there are outstanding examples of high productivity, high quality care which the NHS needs to learn from, exploiting data and technology, establishing lean systems, and bringing together the optimum mix of staff and skills.”