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Vaughan Gething, Cabinet Secretary for Health and Social Services

First published:
23 May 2018
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As part of the Targeted Intervention support provided to Hywel Dda Health Board, under NHS Wales Escalation and Intervention Arrangements, a zero based review of potential excess costs arising from the current configuration of Hywel Dda UHB healthcare services was commissioned from independent external experts.

Given the long standing concerns around structural, demographic and geographical issues within Hywel Dda, the review aim was:

To undertake a Zero Based Review for the current configuration of Hywel Dda UHB healthcare services, that is to assess the “excess” costs of the current configuration of Hywel Dda UHB healthcare services.

The contract was awarded to Deloitte LLP through an open competition through the Crown Commercial Services ConsultancyOne Framework.

Deloitte’s worked collaboratively with both Health Board and Welsh Government officials throughout the review, and their approach to the review focused on four broad drivers of health costs (demographics, remoteness, scale, and efficiency). For each of the 4 drivers, estimates of excess costs experienced by Hywel Dda were developed by comparing the Health Board’s costs to the Welsh average.

The review findings were that 2 factors, demographics and scale, generated excess costs that were unavoidable to the Board, but that the other two factors, remoteness and efficiency, did not generate excess costs for the Board.

The full review report was presented at the Health Board meeting held on 29 March 2018.

http://www.wales.nhs.uk/sitesplus/documents/862/Item 2.6 Report of the Chief Executive1.pdf

The review partially confirms the view that Hywel Dda faces a unique set of healthcare challenges that have contributed to the consistent deficits incurred by the Board and its predecessor organisations. In response to these findings I have approved the release of £27 million additional recurrent funding to the Health Board. This places the Health Board on a fair funding basis compared to other health boards by funding the excess costs identified in the review and provides a sound footing for the Board to develop and transform services.

Following my decision to fund the identified excess costs for healthcare in mid and west Wales, I now expect the Board to  focus on the  costs that the review indicate were within their control to manage and deliver on the efficiencies that it identified.

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