The University of Southampton
University of Southampton Institutional Repository

Managerial perceptions of the incentives inherent in National Health Service capital charging

Managerial perceptions of the incentives inherent in National Health Service capital charging
Managerial perceptions of the incentives inherent in National Health Service capital charging

Capital charging was introduced into the National Health Service (NHS) in 1991 in order to stop capital being treated as a 'free' good and to encourage managers to use their assets more efficiently. This article seeks to examine the extent to which managerial thinking has been influenced. It uses as evidence interviews with NHS managers conducted in Scotland in 1994. The following uses of capital charges data are explored: capital programme; disposal programme; maintenance programme; contract pricing; and budgetary devolution. New capital programmes required more justification and capital charges were seen as relevant to estate rationalization. Less effect was found with regard to the maintenance programme, though this may have been due to a downgrading of the estates function in most Trusts. Although the capital charge costs included in contract prices affect the competitive position of providers, there was criticism of the lack of development of the purchasing function. Budgetary devolution was proceeding relatively slowly but, among those Trusts which had devolved capital charges, evidence was found that some clinicians were becoming aware of the full costs of equipment use. This article concludes, with cautious optimism, that capital charges are beginning to influence decisions and that, despite some incentives being dysfunctional, they will lead to a better managed NHS.

Budgets, Capital Expenditures, Contract Services/economics, Decision Making, Organizational, Fees and Charges, Health Facility Administrators/psychology, Humans, Interviews as Topic, Motivation, Program Evaluation, Scotland, State Medicine/economics
0951-4848
190-201
Heald, D
2be80e37-1e44-4bac-9b86-5e04d7e02e46
Scott, D A
19b5fd34-9974-4ae4-8be0-27a693639e20
Heald, D
2be80e37-1e44-4bac-9b86-5e04d7e02e46
Scott, D A
19b5fd34-9974-4ae4-8be0-27a693639e20

Heald, D and Scott, D A (1997) Managerial perceptions of the incentives inherent in National Health Service capital charging. Health Services Management Research, 10 (3), 190-201. (doi:10.1177/095148489701000306).

Record type: Article

Abstract

Capital charging was introduced into the National Health Service (NHS) in 1991 in order to stop capital being treated as a 'free' good and to encourage managers to use their assets more efficiently. This article seeks to examine the extent to which managerial thinking has been influenced. It uses as evidence interviews with NHS managers conducted in Scotland in 1994. The following uses of capital charges data are explored: capital programme; disposal programme; maintenance programme; contract pricing; and budgetary devolution. New capital programmes required more justification and capital charges were seen as relevant to estate rationalization. Less effect was found with regard to the maintenance programme, though this may have been due to a downgrading of the estates function in most Trusts. Although the capital charge costs included in contract prices affect the competitive position of providers, there was criticism of the lack of development of the purchasing function. Budgetary devolution was proceeding relatively slowly but, among those Trusts which had devolved capital charges, evidence was found that some clinicians were becoming aware of the full costs of equipment use. This article concludes, with cautious optimism, that capital charges are beginning to influence decisions and that, despite some incentives being dysfunctional, they will lead to a better managed NHS.

This record has no associated files available for download.

More information

Published date: 1 August 1997
Keywords: Budgets, Capital Expenditures, Contract Services/economics, Decision Making, Organizational, Fees and Charges, Health Facility Administrators/psychology, Humans, Interviews as Topic, Motivation, Program Evaluation, Scotland, State Medicine/economics

Identifiers

Local EPrints ID: 441353
URI: http://eprints.soton.ac.uk/id/eprint/441353
ISSN: 0951-4848
PURE UUID: 4289f379-88f2-4cae-986b-d27e14caedeb
ORCID for D A Scott: ORCID iD orcid.org/0000-0001-6475-8046

Catalogue record

Date deposited: 10 Jun 2020 16:31
Last modified: 17 Mar 2024 04:02

Export record

Altmetrics

Contributors

Author: D Heald
Author: D A Scott ORCID iD

Download statistics

Downloads from ePrints over the past year. Other digital versions may also be available to download e.g. from the publisher's website.

View more statistics

Atom RSS 1.0 RSS 2.0

Contact ePrints Soton: eprints@soton.ac.uk

ePrints Soton supports OAI 2.0 with a base URL of http://eprints.soton.ac.uk/cgi/oai2

This repository has been built using EPrints software, developed at the University of Southampton, but available to everyone to use.

We use cookies to ensure that we give you the best experience on our website. If you continue without changing your settings, we will assume that you are happy to receive cookies on the University of Southampton website.

×