Acute Trust Turnaround

Break even delivered in year one through £12.25m of cash releasing savings plan (8.5%).

Background

• The Acute Trust (£150m turnover) and the local health economy faced a considerable financial challenge and a requirement to reduce costs by over £20m and reduce staffing by about 260 WTE over a two year period.

• There was an immediate requirement to save £12m in that financial year.

• Kingsgate were engaged by a new chief executive who was committed to delivering significant change in a short period of time.

How We Helped

• Increased grip and control and changed the pace of delivery to secure the in-year position.

• Developed and agreed a turnaround programme, launched by the Chief Executive 4 weeks after engagement to deliver a circa £20m two year savings plan.

• Led weekly reviews with Clinical Directors and Heads of Nursing across all clinical areas to ensure full buy in to turnaround process and adherence to new financial controls.

• Facilitated a CEO-led communications exercise with a standardised message delivered repeatedly at all levels of the organisation.

Results

• Break even delivered in year one through £12.25m of cash releasing savings plan (8.5%).

• 30% reduction in corporate pay costs.

• 38% reduction in clinical administration costs.

• 8% reduction in beds achieved through length of stay reductions.

• Delivered all access targets in year two.

• Significant value for money improvements (eg 7% reduction in nursing costs through skills mix and rota management – led by Director of Nursing).

• Delivered £21.2m saving (14% of turnover) over a two year period and a surplus position in the second year.