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What NHS providers can do to curb agency costs

What NHS providers can do to curb agency costs
By Valeria Fiore Journalist intern
5 June 2018

In 2014/15, the NHS disbursed over £3bn on agency staff, according to data from NHS Improvement.

In order to reduce this spending, NHS Improvement decided to introduce new agency rules in 2015.

This year, trusts managed to save £527m on agency staff compared to last year, despite NHS bank staff costs amounting to a whopping £976m more than planned.

NHS Improvement further updated agency rules in May to make sure providers are even more effective at making agency staff cutbacks.

The organisation decided to take a closer look at agency pay by asking chief executives to sign off ‘agency shifts at £100 an hour or more and above price cap’, and report them to NHS Improvement on a weekly basis prior to the shift.

The same applies to bank staff, marking a reduction from the current requirement to sign off and report shifts over £120 an hour.

So how can trusts reduce agency staff expenditure? Here are our top tips:

Engage your staff

Creating a supporting work environment will help you drive down agency and bank staff costs, an analysis by The King’s Fund, commissioned by NHS England, revealed last March.

The report said that chief executives were able to make considerable savings on agency staff by keeping their permanent employees happy as ‘a one standard deviation increase in overall staff engagement is associated with a £1.7m saving on agency staff costs for the average trust’.

When staff is engaged, they have less reasons to call in sick. You don’t necessarily need to do much to engage your staff – just listen to their concerns. They are best placed to give you feedback on your organisation and offer ideas on how to improve.

Support flexible working

NHS chief executives need to consider the different needs of their workforce in order to ensure they will be happy to continue to work for the organisation.

Women make up 77% of the NHS workforce, according to the latest data published by NHS Digital. Many are parents or single mothers, and as a consequence of a growing population, both women and men are increasingly taking on carer roles to look after relatives, according to NHS Employers.

Offering staff the possibility to work in a more flexible way could help trusts improve employee retention rates and save money and time that they would otherwise dedicate to finding and paying for temporary staff.

Create a sustainable supply

Organisations should create a sustainable supply of workers who can fill temporary vacancies, suggests NHS Employers. This can be done by asking part-time staff if they are interested in taking on a full-time role if a vacancy becomes available, instead of calling in temporary staff.

It can also be more expensive to use temporary staff at evenings and weekends, so NHS Employers also advises try to use your substantive staff at those times instead.

Use technology

Technology plays a role in helping to reduce spending on agency staff. Everybody loves apps, but staff at the Royal Surrey County Hospital NHS Foundation Trust loved their app even more after it allowed them to curb spending on agency staff.

The Locum’s Nest app helped the trust save £150,000 in 2017, reducing the need for agency staff by encouraging more bank staff to cover vacant shifts, as NHS Employers reported in their case study.

Introduce a retention strategy

Managers could prevent employees from leaving by doing as little as making time for them, grabbing a coffee and holding what Lynn Demeda, deputy director of workforce at Guy’s and St Thomas’ NHS Foundation Trust, calls ‘stay discussions’.

Ms Demeda told Healthcare Leader that her organisation was able to retain 117 staff in one year after successfully introducing a retention strategy.

The strategy included asking managers to hold informal conversations with their employees to talk about their ambitions for the future and how they could grow within the organisation.

You can read the full case study here.

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