1% Improvement 'Can Save NHS £400m'

Increasing staff efficiency in hospitals by just 1% could represent around £400 million in savings to the NHS a year, a report has found.

Making sure every hospital pays the best price for medicines and supplies could also save money that can be reinvested in frontline care, chairman of the NHS procurement and efficiency board Lord Carter said.

He was asked to produce a report into how up to £2 billion in procurement efficiency savings can be made to improve the health service's financial situation.

Among his findings was a hospital that was using the soluble version of a steroid and paying £1.50 per tablet, when it could have been paying 2p for the solid version.

By saving the soluble version only for children and patients who have trouble swallowing, it is saving £40,000 a year.

Lord Carter also found that hip operations are costing some parts of the NHS more than double the amount they should.

Often the hips used do not last as long as less expensive versions, meaning patients need more replacements and follow-up care, costing the NHS up to £17 million extra every year.

He has spent the last year working with 22 leading hospitals to see how the NHS could save money.

One hospital, which has 23 operating theatres, improved the way it tracks the products used during surgery and saved £230,000 in the first year, he said.

His report, published today, found that by making better use of staff, using medicines more effectively and getting better value from the huge number of products the NHS buys, it could save up to £5 billion a year by 2020.

Reducing the number of product lines of everyday consumables that the NHS uses from more than 500,000 to fewer than 10,000 and being better at procurement could save up to £1 billion in five years, he said.

The report said the size of the NHS means that by doing several small things better, huge savings are possible.

He found another hospital could save up to £750,000 a year by improving the way it deals with staff rosters, annual leave and sickness, flexible working and making the most of staff hours, and recoup the £10,000 a month it was losing due to people claiming too much annual leave.

Last week Health Secretary Jeremy Hunt described Lord Carter's findings as "staggering" as he spoke of a huge variation that leaves some hospitals paying more than twice as much as others for toilet roll.

Mr Hunt said a box of syringes could be bought for £12 by one hospital but another would pay £4 a box, while surgical gloves cost £1.27 to one hospital and as little as 50p to another.

A box of toilet rolls could cost £66 or £30, he said.

He also described how money that could be spent on patient care was instead going on products from sales reps, with some hospitals targeted by hundreds.

The NHS spends more than £22 billion every year on goods and services, which accounts for around 30% of the operating costs of each NHS organisation.

Responding to the report, Rob Webster, chief executive of the NHS Confederation, which represents around 500 members across health and social care, said: "Lord Carter's interim findings are crucial to understanding how costs might be brought down and we expect that the implementation of his review will be developed further with the sector, in the spirit it has been up to now.

"The potential savings need to be tested and developed with the wider NHS, so that final savings targets due to be handed to the NHS from September are owned by the whole service."