This article appears as part of the Inside the NHS newsletter.

Are we really ready to have a "national conversation" on the future of the NHS, even if that means doing less?

The BMA has repeatedly called for "an honest, open and transparent" discussion about how to make the health service sustainable long-term, while Professor Andrew Elder – president of the Royal College of Physicians Edinburgh (RCPE) – said in June that it was time for a "debate about whether we increase funding, through direct taxation or some other means, or make reasoned decisions about what we can and cannot provide from the public purse".

Scotland's Auditor General, Stephen Boyle, added his voice to the chorus at the weekend when he warned that the current model is "not sustainable" and without reform the spiralling costs of delivering health and social care will undermine other public services.

It comes against a backdrop where NHS Scotland's chief executive, Caroline Lamb, has written to health board leaders urging them to find cost savings amid a predicted £500-600 million overspend in the current financial year.

Scotland's health budget over time (Audit Scotland) 

Budget pressures

In a letter dated June 21, Ms Lamb told NHS chief executives that the health service is facing a £500-600m black hole in its finances for 2024/25 unless additional savings are found (on top of the £350m of cuts already identified).

This was "not acceptable", she warned. The Scottish Government is expected to balance its books at the end of each financial year, but the scale of the deficit in health risked tipping the whole system into the red.

Grim tidings indeed for health boards which are already struggling.

Eight required Scottish Government-funded bailouts – known as brokerage – to break even last year, up from five in 2022/23.

From now on, the value of these loans will be capped. Health boards – which collectively owe the government more than £380m to date – can no longer rely on them to plug a hole in their balance sheets.

NHS Scotland chief executive Caroline Lamb said the health service is facing a £500-600m black hole in its finances for 2024/25 unless additional savings are found (Image: Derek McArthur)

What to cut?

Ms Lamb urged NHS management to immediately review medicines of "low or limited clinical value". Of the £16.7bn in revenue spending allocated to Scotland's health boards in 2022/23, £980m was spent prescribing drugs in hospital – an increase of 17% in five years.

So what might be axed? Cold remedies, antihistamines for seasonal allergies like hayfever, or sedatives for non-clinical purposes (to anxious flyers, for example) are the kind of low-hanging fruit that could be dropped. This is hardly likely to deliver massive savings, however.

In primary care, drug spending has actually fallen by 5.4% over the past five years, to £1.1bn, so perhaps hospitals can learn from GP surgeries.

However, the issue is much less to do with the NHS prescribing basic medicines, such as paracetamol and aspirin, as the huge cost of supplying cutting edge, new medicines.

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Back in 2017, Dr Alan MacDonald, then-chair of the Scottish Medicines Consortium (SMC), questioned whether a push to prescribe expensive cancer medicines to extend terminally-ill patients’ lives by months or weeks might be "encouraging therapeutic futility" at a cost to other conditions.

Meanwhile, the NHS will be expected to stump up for obesity injections such as Wegovy and a new wave of Alzheimer’s drugs. The former appears to deliver a range of cardiovascular benefits beyond weight loss, while the latter seems to slow disease progression – but both will come with hefty price tags.

Staffing costs are also in Ms Lamb’s sights. Health boards are under instruction to cut their administrative staff headcount back to pre-pandemic levels. Meanwhile, spending on agency staff has doubled in the past five years – much of this driven by a shortfall in nurses.

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If health boards cannot fill a vacancy permanently, should they forego an agency nurse to save money? And how would that square with Safe Staffing legislation?

Internal documents show NHS Tayside has already weighed up whether to stand down its locum breast cancer cover to cut costs.

A "national conversation" has to be more than just talk. The NHS needs clear answers on how much the public is willing to pay – and what it is willing to lose.