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Financial Resource Management In Healthcare Social Work Essay

Paper Type: Free Essay Subject: Social Work
Wordcount: 2550 words Published: 1st Jan 2015

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This budget has the Healthcare For All Hospital Trust in good standing at the end of the next fiscal year. Potential problems could arise however, if the macular degeneration developments do not come to fruition. In that case, the hospital would have a choice: meet the target cuts, and be in debt, or do not aim to make the hospital’s target cuts. Small cuts could be made for the fiscal year of 2010-2011, while developing other revenue-generating projects such as the macular degeneration facilities.

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This report deals with the financial implications of creating a more sustainable way of providing health care to individuals with learning disabilities, as highlighted in Sir Jonathan Michael’s 2008 report into access to healthcare services by people with learning disabilities, entitled ‘Healthcare for All’. This report aims to briefly review a variety of issues on sustainable funding for healthcare, both from the point of view of a local Primary Care Trust (PCT) as well as the central Health Care for All hospital trust. The first section of this paper, entitled ‘Changes in Healthcare Demand’ focuses on the changes in patient demands for services, especially those instigated by the Payment by Results and Patient Choice reform measures. The paper then moves onto a section entitled ‘Possible strategies for managing demands,’ which examines what possible strategies exist for managing those changing demands. Potential systems for sustainable healthcare funding are then examined in the section entitled ‘Sustainable Healthcare Funding,’ where these issues are addressed form both the PCT and Healthcare for All points of view. The consequences for budgeting for these programs are examined under a section entitles ‘The Behavioural Aspects of budgeting and performance management.’ The final section examines how financing could be altered to produce a more long-term fiscal health in the NHS, entitled ‘A More Sustainable Way of Funding the NHS’. Through this summary, this report, using financial and qualitative analysis, aims to provide an overview on ways in which a variety of problems within the UK health sector could be solved.

People with learning disabilities have traditionally not been thought of as a group that needs special access to healthcare. However, recent research has demonstrated that this sub-group of society often finds it more difficult than others to access the care they need.

‘The health and strength of a society can be measured by how well it cares for its most vulnerable members. For a variety of reasons, including the way society behaves towards them, adults and children with learning disabilities, especially those with severe disability and the most complex needs are some of the most vulnerable members of our society today. They also have significantly worse health than others. The Inquiry has found convincing evidence that people with learning disabilities have higher levels of unmet need and receive less effective treatment, despite the fact that the Disability Discrimination Act and Mental Capacity Act set out a clear legal framework for the delivery of equal treatment’. (Healthcare for All 2010)

New research shows that many people who have learning disabilities find it more difficult than other people to access the facilities where they can have treatment and assessment performed for general health problems, those that are not directly related to their disability. New demands to solve this problem include increasing support that these people have in accessing equal treatment, as required by the Disability Discrimination Act. Adjusting whenever necessary communication patterns in case such an individual demonstrates a difficulty in understanding, or exhibits apparent anxieties about their treatment.

This is seconded by people who work within the secondary care providing industry, who claim that their opinions are often ignored by healthcare professionals, despite the fact that they have the best information about the people they support. These practitioners are not offered the same support as hospital workers are, and they are often required to provide care beyond their personal


Health service staff, particularly those working in general healthcare, appear to know only limited amounts about learning disability, not understanding how this could affect the way healthcare is accessed and delivered. They are often unfamiliar with the regulations framework, and often they do not understand that a right to equal treatment also entails a right to equal access and equal understanding. Communication problems, and cognitive impairment that is often associated with learning disabilities are now on the fore front of reorganization schemes in the NHS.

Emerging demands include simple training to increase and facilitate communication between patients suffering with these problems and doctors and other practitioners. Healthcare for All hospital trust and local PCTs may approach these new demands differently.

Possible strategies for managing demands

Payment by Results

Payment by Results (PbR) aims is to provide a regulated, transparent, system that paying trusts employ. In theory, PbR will reward efficient work, as well as support a variety of patient choices and will work to encourage waiting time reductions through sustainable measures. In this model, payment is adjusted to the activities engaged in, and is then adjusted for each casemix. This system ensures a fair and equalized basis for the distribution of hospital funding rather than relying principally on the negotiating skills of particular individual managers.

In July 2000 the NHS introduced the Government’s intention to establish link in the fund allocation process between the treatments they perform and the funds they receive. In order to ensure that patients and hospitals receive the best from available resources, major changes were and still are necessary for improving the way that money flows through the NHS, accounting for things such as differentiation between routine surgeries and emergency admissions.

In this model, hospitals will now receive payment based on the elective surgeries they choose to perform. These reforms of the financial system offer incentives that reward good performances while sustainably reducing variables such as waiting times, and other hindrances that shorten capacity.

Traditionally, hospitals have been paid in block contracts. This means that a fixed sum of money is delegated for a broadly specified type of service, rather than for the number of services performed itself. This meant that there was no incentive for healthcare management to increase numbers of services offered, because they would get no additional funding. In this newer system, hospitals are encouraged to perform more procedures, more tailored to patients’ needs.

Patient Choice

The Government is developing programs whereby patients have more choice and control over their treatment practices and care. In the NHS Constitution this is referred to as ‘patient choice,’ which now designated that patients have the right to choose a health practitioner based on a first referral, to any consultant service for elective healthcare.

For patients with long-term conditions, this need for more choice is particularly relevant. The different results include enabling the individual patients to identify whichever of their specific needs should be regarded, and agreeing in advance as to desired outcomes, care arrangements and personalized attention. This entails bringing patients in during the planning process, and ensuring that the pre-agreed care plans allow individuals to self care, including those who opt for supported living or tailoring other social care needs in order to maintain independence.

Sustainable Healthcare Funding

How can all of these adaptations for increased care and provisions be funded in a realistic way? An adequate budget assessment is the first step to assessing this situation.

Zero-based budgeting is a technique that involves planning and decision-making, reversing the working process of more traditional budgeting techniques. Unlike using the incremental approach of traditional budgeting zero-based budgeting would require a total overhaul of each individual departmental budget, examining them all ‘from scratch’. Because each dollar is laid out across an entire organization, and budgeted funds can be moved across departments to meet targets, it provides a more holistic approach to mega-organisations, such as the NHS.

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This budgeting technique works best for the needs of the NHS, which would allow for a more efficient allocation of all resources across all regions and departments. Managers of each department and hospital could look broadly to find cost effective ways to improve operations. Inflated budgets are more easily noted when they are examined in a group rather than independently. This system is also particularly useful for service departments where the output is difficult to identify, and looking across budgets could show where these shortfalls lie.

In theory, one of the results of zero-based budgeting would be an increase in staff motivation. This is because it provides greater opportunity to demonstrate and develop initiative and responsibility in decision-making. Communication and coordination across diversified institutions can also be encouraged by being forced to come together to create an annual budget. Outsourcing can be easier to implement than it would be, if it were done on a per-department basis. Overwhelmingly, zero-based budgeting forces organizations to centralize and identify their mission and their relationship to overall goals.

But there are disadvantages to this method of budgeting as well. Zero-based budgeting can present difficulties for defining ‘the units of decision-making’ because it is so time-consuming and exhaustive. This method also makes it necessary to train managers in a particular format. Because it must be clearly understood by all different managers at various levels in order for it to be successful. In a large organization, such as the NHS, the sheer amount of documentation may be so excessive that no single overseer could read it comprehensively.

Budgetary slack could be a helpful tool; by overestimating costs and underestimating available funds, it should require a tight budget for the new fiscal year. referring to budgetary bias, is a common process where an implementer intentionally underestimates revenue or overestimates expenses in the tight budget. Managers may attempt to create budgetary slack in three ways.

The Behavioural Aspects of budgeting and performance management

The behavioral aspects of budgeting make up a highly important factor in successful ¬nancial management. It is important for managers to develop the skills and techniques that help to develop and sustain e¬€ective control over the people involved in budgeting, and the budget itself, including income and expenditure.

Effectively managing budgetary controls can use a system that relies heavily on individuals within a particular organization. The human aspects of developing, controlling and implementing a particular budgetary system can be nearly if not more complex than the financial aspects of managing a budget, but they are essential. All processes related to spending organizational money, and budgeting those expenditures involve relationships between the di¬€erent people who work within the organization. These can be managers, general employees as well as directors of the whole organization. Chadwick (1993) writes that budgets are actually best approached as models ‘designed to a¬€ect people’s behavior,’ and they cannot be separated from this aspect.

A More Sustainable Way of Funding the NHS

Whether the NHS continues on into the future or not will depend on choices that the government makes. These choices relate to funding, and efficiency. Changes to the present system that is in place could present challenges, but they would still be possible with more resources being spent in producing a greater understanding of both the national and the regional effects of NHS policies. This could result in health authorities being given increased amounts of responsibility in managing their money. This would need to go along with a system of penalties for those who failed in making their facilities more efficient. This would work if policies that check the cost effectiveness of new developments and equipment were used at the facilities. The central NHS planners and policy makers could attempt to reduce the demands from the unrealistic expectations clients and patients demonstrate, by implementing spaces and venues for public debate focusing on establishing priorities and the availability of all healthcare resources, including private health care.

There is much emphasis on how the supply side of the NHS affects the cost, and very little on how managing demand will improve the system. Increasing the number of people who use the NHS as well as increasing the speed at which they are seen is simply unfeasible. 
The cost to the NHS of bad habits related to health choices amongst its users amounts to between 5 and 60 billion pounds a year, depending on whether loss of productivity and other factors are accounted for. This cost is largely preventable, but only in looking at the NHS as part of a wider context. It is in everyone’s interest, especially the NHS staff whose jobs may be in threat, to find ways of helping to reduce these costs. So while much of this report has focused on inter-NHS practices, there is an emerging focus on managing people’s health outside of the healthcare facilities. 

The NHS Alliance has found 3 key points to affect health costs and budgeting. 1.

‘Effective local delivery requires effective participatory decision-making at local level. This can only happen by empowering individuals and local communities, to which we would add local frontline staff.

2. Create fair employment and good work for all…one of the most effective ways of increasing productivity is by valuing the workforce and improving their health through greater security and flexibility in employment.

3. Increase availability of long-term and sustainable funding in ill health prevention across the social gradient. Let’s have a focus on landscape gardening rather than short-term bedding plants.’

(NHS 2010)


The NHS is one of the biggest government institutions on the world, and deals with the health and healthcare provisions of millions of people each year. With constantly developing technologies, as well as government economic crises, it is very difficult to develop a system through which this huge machine could successfully be funded, without bringing about any debts.


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