New research shows that improvements in just eight areas of NHS activity could save England’s 212 clinical commissioning groups (CCGs) more than £1.6 billion a year, or 2.5% of current hospital spend.

The research, contained within a white paper published by consultancy MedeAnalytics, analysed statistics from a year of the Hospital Episode Statistics (HES) data sets, which cover all patient-level activity and associated costs taking place in hospitals in England. From this analysis, the researchers identified eight areas of activity that could be either improved internally by NHS Trusts or carried out closer to people's homes, thus avoiding hospital visits and associated costs. The eight areas are: 

- emergency admissions with 0-1 day length of stay;

- inappropriate admissions;

- readmissions within 30 days;

- outpatient procedures carried out as inpatient same-day procedures;

- follow-up outpatients to first outpatients visits ratio;

- walk-in/inappropriate accident and emergency visits during general practitioner clinic hours;

- admissions for long-term conditions; and 

- falls.

Interestingly, the data analysis found no obvious pattern in the challenge facing individual CCGs across the eight key metrics. Also, for 49 of the 212 CCGs, there was only one area in which they needed to improve.

In terms of regions, the study finds that the Midlands and East region currently has the best levels of performance overall. The London region comes second, but it is also the most varied in rankings, scoring well in some areas and poorly in others.

And the region facing the most challenges is the North, ranking worst for five of the eight indicators.

However, where an individual CCG scored poorly against a metric, other Groups in the region performed well. There is thus a significant opportunity for CCGs with areas of poor performance to use resources more effectively by understanding how their peers have tackled these challenges, the authors note.

With NHS expenditures accounting for 23% of public service spending in 2010-11, the implications for addressing this variation in performance are significant. The MedeAnalytics researchers have modelled that if every CCG achieved the average level of performance for the eight key metrics identified in the study, annual savings of £880 million - or 1.4% of total current hospital expenditure in England - are achievable.

To put this into perspective, gains on this scale would allow the NHS to achieve more than 10% of its annual savings target. Moreover, if the best (upper quartile) levels of performance were achieved everywhere, the saving should exceed £1.6 billion, 2.5% of current hospital spend, they say.

The study authors conclude that their findings offer important insights into the way NHS resources are being used in hospitals, and point out that without addressing areas of lower performance, the Service will struggle to achieve planned service improvements and better value for money. They note that while many organisations, including The King's Fund, have published lists of priorities for the new CCGs, their white paper is the first of its kind and goes one step further, in identifying eight key performance metrics and quantifying the potential impact of more consistent performance across England.

"The current spending plans that run to March 2015 are among the most challenging the NHS has delivered in any of the last 50 years, so NHS commissioners need bespoke and timely intelligence to tackle the variations they inherit," commented Anthony McKeever, one of the authors of the study and chief executive of MedeAnalytics' UK business.

"To rise to the challenges they face, CCGs must focus their resources on practices where intervention will generate the highest pay-off. This white paper offers CCGs some valuable intelligence on how to do this," he added.