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WEST SUFFOLK HOSPITAL NHS TRUST

Agenda item 6.1. WEST SUFFOLK HOSPITAL NHS TRUST. FINANCE & WORKFORCE REPORT MAY 2009 Linda Potter, Director of Finance. Contents:. Executive Summary Income and Expenditure (Trust) Income and Expenditure (Directorate) Directorate Performance Summaries Balance Sheet Cash Flow

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WEST SUFFOLK HOSPITAL NHS TRUST

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  1. Agenda item 6.1 WEST SUFFOLK HOSPITAL NHS TRUST FINANCE & WORKFORCE REPORT MAY 2009 Linda Potter, Director of Finance

  2. Contents: • Executive Summary • Income and Expenditure (Trust) • Income and Expenditure (Directorate) • Directorate Performance Summaries • Balance Sheet • Cash Flow • CIP Summary • Capital Report • Appendix 1: Agency cost analysis

  3. EXECUTIVE SUMMARY

  4. PERFORMANCE SUMMARIES • The following schedules show the financial and workforce performance for the whole Trust and each of the directorates. • Activity variances are based on an estimated profile. • Forecast outturn is assumed to match full year budget • A detailed forecast will be available after the 1st quarter financial results and included in the July Finance Report • The Budget adjustments for additional high cost drugs costs above the SLA value is not reflected in the month variance stated, pending the completion of a project between Finance and Pharmacy. Trust • The Trust has generated a surplus of £694K, £284K above budget. Pay costs on budget. Non-pay costs are generally on or below budget, except drugs and services from other Trusts. • Overall nursing costs are 0.6% below budget. • The Trust currently employs 2250.1 WTE staff, an increase of 9.0 WTE on last month. • There are currently 70.25 WTE (84 headcount) employees on maternity leave, compared to 42.95 WTE (54 headcount) for the same period last year.. There are several areas of the hospital where the high level of maternity leave could impact on service delivery and are therefore back filled through temporary staffing.

  5. Surgery • Income for the month was better than budget due to increased charges for medical staff to other Trusts of £27k and USAF (Tricare) income of £30k. Pay was £72k more than budget primarily as a result of medical agency staff £60K, Prof. & Tech agency cost £16k, but partially offset by £5k from vacancies. Non-Pay was £42k under budget due to drug savings £15k, hearing aids £26k, orthopaedic appliances £12k and £3k professional fees but an unplanned medical staff recruitment fee of £15k partially offset these savings. • The Directorate continues to experience high levels of GP referrals necessitating additional outpatient sessions to manage demand, particularly within ENT and Oral Surgery. Referrals in other areas have reached a plateau but remain higher than capacity. New to follow up ratios are within acceptable limits. The majority of additional activity is within outpatients based on activity data. • Sickness rates on the inpatients wards have improved but maternity leave continues to increase resulting in more backfill from bank staff to meet the current level of elective and emergency activity. • The use of agency staff was £48k for junior medical staff (Gen. Surgery, Urology, T&O, ENT) and £12k for consultants (Anaesthetics). A further £15k was for the plaster orderly in the Fracture Clinic (long term sick and subsequent retirement) and £5K Admin cover. Locum cost were £50k, primarily in Anaesthetics and Plastics for consultant cover and bank usage was £56k for nurses and medical secretaries to cover sickness, maternity leave, bank holidays, and vacancies.

  6. Medicine • The Directorate was overspent by £96k in May 2009. • Directorate activity for the current financial year has not yet been published, therefore it is difficult to ascertain if some of this is due to over performance. • ‘Other Income’ was over recovered by £18k, due to increased charges out for consultants reflecting the Medical staff pay award – made in May and backdated to April. There were also unbudgeted charges to the PCT for staff involved in the Rapid Response Team. • Staffing costs were the biggest contributor to the overspend. Consultant vacancies in Gastroenterology, Oncology, Dermatology, Stroke and A & E have been covered by a combination of additional sessions, locum cover and agency costs. The continued increased demand for Rheumatology outpatients has necessitated additional outpatient sessions. • Agency expenditure was concentrated on filling Medical vacancies. The main areas using non-NHS staff were Accident and Emergency and junior on-take medical staff. • Nurse costs net of bank expenditure were underspent. • Non pay expenditure was overspent by £15k in the month – the costs of drugs exceeded budget by £8k primarily in Oncology and Haematology and Neurology, the majority of which can be reclaimed from the PCT as part of the high costs drugs excluded from tariff. • The Directorate incurred a one off cost of £6k related to advertising. Normally this is funded via HR, but local nursing staff were targeted as part of a successful recruitment drive. • Increased rental costs for the Mobile Angiography unit (reflecting a new, more resilient unit) have meant expenditure above budget. Income, will exceed the expenditure, is recorded centrally and therefore does not offset the costs to the directorate.

  7. Clinical Support • The directorate underspent this month by £3k: pay costs and income underspent, whilst nonpay overspent. • Income exceeded budget due to the continued support to EIT in A&E: involving both Physiotherapy and Occupational Therapy staff. • A consultant vacancy in Microbiology has been offset by additional PAs worked by the existing consultants and locum cover. New consultant due to take up post in September. Additional sessions in Radiology have meant net costs on consultants exceeded budget. • Vacancies in Physiotherapy, Occupational Therapy, Radiology and Pharmacy have meant significant pay underspends. Departments are having to resort to temporary agency cover as a measure to ensure continued service delivery pending appointments and students qualifying over the summer. • A drug overspend of £18k in the month, mainly in pharmacy is to be investigated. • Medical & Surgical costs exceeded budget by £17k, mainly in Endoscopy. A review of the expenditure has identified this is due to an increase in activity and the purchase a patient monitor. ( £4k ) • Pathology equipment and materials were underspent by £19k, this was due to investigations into April 2009 expenditure. Subsequent adjustments have been made to contracts for blood products and the coagulation analyser. • Workload demand in Histopathology has meant that an increasing amount of work has had to be referred to an outside agency. In May this amounted to £10k. A new consultant recently approved by TEG, will address this longer term. • Services received continue to overspend. Addenbrookes charges in Radiology are expected to be settled immanently, addressing the current budget allowances which have been made to reflect this historical overspend. Additional provision has also been made for Speech and Language Therapy, anticipating additional costs for the Stroke/Thrombolysis service started in April.

  8. Woman & Child • The favourable variance to budget is driven mainly by £38.1k in vacant positions, 11.9k in lower drug cost, £3.3k less rent of clinic space, £9.8k in transport cost due to last year credits received, additional USAF income of £26.2k and £20.3k from EWTD funds. These savings were partially offset by extra session payments of £8.8k and £18.8k in bank usage. • Sickness rates are improving but maternity leave remains high. Use of bank staff (£56.8k) reflects the four bank holidays in the period. Paediatrics have used agency staff to support the service. Locum staff (£27.6k) are being used to cover the vacancies for the hybrid consultants in Paediatrics although part of this cost is offset by additional EWTD income (£20.3k).

  9. Facilities Income has evened out from April and is now on budget. Pay SSD (£6k) – vacancy on hold. Housekeeping (£45k) – additional bank & agency staff for continuation of enhanced clean. Facilities Admin (£11k) – phasing of vacancy for Director post. Non Pay is generally under spending across the directorate as some non essential spend is being held until July as requested. Some key areas of under spend are as follows: Estates (£50k), HRS (£5k), EBME (£34k), SSD (£5k) & Purchasing (£5k) - service contracts, phasing of budget in line with timing of contracts is required. Utilities (£10k), lower tariffs & operation of CHP. Portering (£7k) – has incorrect credit, to be corrected. Switchboard (£5k) – telephone calls reduced by installation of GSM gateway (fixed calls to mobiles) Workforce Sickness monitoring & return to work interview process is now established across the directorate and continues to reduce sickness/absence.

  10. Corporate • Corporate report is a consolidation of Finance and Information, Human Resources and Communications, Medical Director, Nursing and Governance, Trust Office and Overhead Directorates. Reserves are excluded from this report. • Agency and bank staff are being used in Finance, HR and the Nursing Directorate, but the overall pay variance is favourable. • Both Income and Non Pay variances are favourable overall. Overheads have some unbudgeted non pay costs which are offset by additional income. • The sickness and maternity rates remain below the overall Trust rates.

  11. The Capital budget will be agreed in June 2009. The current report reflects the 2009/10 impact of schemes continued from 2008/09 and any urgent equipment purchases.

  12. Appendix 1AGENCY COSTS ANALYSIS (based on costs as at May 2009) • The following graphs illustrate the breakdown of agency expenditure incurred during the two months to May 2009 • The analysis has focused on the Medical Agency costs as this is the largest area of agency expenditure incurred by the Trust. • The graphical information analyses the expenditure by the staff type, the location (department) and by the reason (type) for the agency expenditure • The Trust, as part of it’s budget setting process, does not generally set budgets for agency expenditure, unless there is a specific and long-term need for agency expenditure required. • The Trust to date is maintaining total pay costs to budget. • The majority of agency costs is linked to covering vacant posts, with low agency cost associated with staff absence.

  13. Graph 1 Graph 2 • Total pay is currently in line with total budget • Total pay analysis show agency costs are currently 1.86% of total pay costs • There are no agency nursing costs incurred by the Trust to date

  14. Graph 3 Graph 4 • Graph 3 illustrates the majority of the budget is linked to substantive posts • Locum costs are costs paid at NHS pay rates and are therefore not included as agency costs • Graphs 3 and 4 illustrate only a small proportion of agency cost is planned

  15. Overspend £90k • Graph 5 indicates that consultant substantive and locum budget covers the costs of substantive locum and agency expenditure • Graph 6 illustrates that almost all the consultant agency cost relates to covering vacant consultant posts • Graph 7 indicates only several areas were expecting to have to fund agency costs; vacant posts are driving the remaining agency cost Graph 5 Graph 6 Graph 7

  16. Graphs 8 and 9 illustrates that there is significant pressure on junior doctor costs with a large number of vacancies at junior doctor level. Graph 8 Graph 9 Graph 10

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