Statistics updating resource allocation

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Each country of the United Kingdom manages its own NHS but this paper concentrates on England only.

The English NHS is managed by the Department of Health and is administered locally by 152 geographically defined health authorities, known as primary care trusts (PCTs), with average populations of about 400 000.

The costs of all local health care are met from within the local PCT’s fixed budget, as set by the national ministry.

If hospital referrals or other aspects of local clinical practice imply expenditure in excess of the local budget, then some sort of rationing takes place.

This may take the form of a delay in treatment or a refusal to prescribe certain medicines.

Patients can at any stage seek private care although, in practice, this accounts for only a small proportion of health care in the United Kingdom.

RAWP also broke down health care into a small number of broad categories of conditions and the index of relative need for care for each category was determined by applying the condition-specific SMR to the population of an area.This trend has been given added impetus by the increased decentralization of health services worldwide.If decentralization is to be effective, national governments need to be seen to be treating different localities even-handedly.While formulae are applied to all the categories of expenditure, this paper focuses mainly on the acute sector, which accounts for 66% of all PCT expenditure.The starting point for any discussion of formula funding in the United Kingdom’s health system is the recommendation in 1976 of the Resource Allocation Working Party (RAWP) for allocating NHS funds to English regions.

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