Hospices: health care providers, commercial businesses - or both?
Should hospices continue to depend on statutory funders for large portions of their financial requirements or become more financially independent?
Are hospice teams skilled and prepared enough to embrace the change that is required for future financial sustainability?
As part of our Hospice Thought Leadership series, Rhona Baillie, Chief Executive of The Prince & Princess of Wales Hospice, discusses sustainable financing for hospices.
Rhona M Baillie OBE, EN, RGN, RN (Canada), Diploma Cancer Nursing, BSc in Community Health & Diploma in District Nursing
Chief Executive, Prince & Princess of Wales Hospice
Introduction: a balance of approaches
When asked to write this article, my first thoughts were to look back 10 years ago and consider how I would have written it then. I quickly concluded that it would have been a much brighter picture, regarding statutory funding.
In my 19 years as CEO of the Prince & Princess of Wales Hospice (PPWH) in Glasgow, I have never known such a challenging external landscape, a threat to statutory funding, and an environment that is so alien to negotiation. Hospices are often regarded as an afterthought and in some cases are largely misunderstood by statutory funders.
My head quickly turned to hospices’ ability to fundraise in their extremely supportive local communities, where we are held in high regard in appreciation of the quality of care we deliver, much of it funded by the public we serve. Although that public purse is shrinking, we can still rely on the loyalty of our supporters.
And lastly, I considered how some hospices have shed their traditional coats and begun to behave in innovative and more versatile ways when generating income, in short, they are behaving like commercial businesses. The challenge here may be the Ivory Tower and its defenders as dedicated hospice teams, demonstrate resistance to commercial innovation which is perceived to be infiltrating the very values and traditions that hospices are built on.
Is the answer possibly a balance and respect of all three approaches, statutory funding, fundraising and a commercial approach, to suit the environments within which we operate UK wide, promoting increased financial independence and choice?
This current, lengthy and unstable financial landscape, leaves hospices facing an impossible balancing act, as inflation, energy costs, and salary increases, consume our income and negatively affect public donations.
However, hospices are doing what we always do – As Knights in Shining Armour: stepping up, and focusing on delivering our charitable objectives, always attempting to bridge the financial gaps and being forced to accept the consistent message of no additional support from our statutory funders.
This response to financial hardship and survival is questionable, outdated and largely unsuccessful. The NHS is financially cash strapped, unreliable for fair and additional funding, and hospices can’t continue to generate income in the traditional way we used to.
Statutory funding negotiation is challenging and disheartening: Commissioning as an approach and language has always been a bone of contention. Why Governments fail to recognise the overall financial contribution and benefit to NHS patients, and the lack of recognition of the contribution that hospices make to bridge the gaps in provision of statutory services is beyond comprehension. At the very least funders should practice within a uniform national framework, communicate in a transparent and consistent way and fund hospices fairly and equitably, recognising us as financial partners, caring for NHS patients.
"Hospices collaborating and operating as one voice within Scotland has been conducive to building professional relationships between Scottish Government and hospices in funding negotiations during COVID19, and this approach will be consistently applied moving forward. Hospices are stronger together."
Income Generation: it's time for change
Regarding income generation: It’s time for change, to take the reins, and realise that the traditional hospice fundraising models that we all understand and cherish may be incompatible with this current and future climate.
Whatever approach we take, it remains essential that we keep our patients and families at the centre of all our decisions, it’s what we exist for and are passionate about.
PPWH commenced this financial year with a proposed deficit position, many of our colleagues are in similar positions, as statutory funding shrinks. In response, in addition to our fundraising models, we focused and built on a commercial and social enterprise strategy.
BargaCree, a community inhouse Café will generate circa £60k profit this year, operated by a commercial inhouse catering team, producing a range of luxury goods for sale, and providing an events service for our corporate and community partners.
Beauty with a Conscience, a social enterprise beauty business partners with a local college to provide a training site for students, all proceeds benefit the hospice. Hospices are hiring out spaces to generate income and PPWH new build was designed to support this. Having a diversity of new and innovative income streams is essential for financial survival.
There are some key questions that we must ask ourselves:
- Are most hospices running efficiently?
- Are our business strategies driven by the fact that we are very often strapped for cash, so we must be clever about how to deploy our resources, not to generate profit but simply to survive?
- Does this approach stifle the very innovation that we need to ride out this perfect storm?
- Is it the right approach to batten down the hatches as a coping strategy?
Refreshing strategy, assessing the organisation’s appetite for risk, developing a robust and innovative commercial arm, and employing the right skill mix of staff, while maintaining a laser focus, will develop into new and diverse ways of generating income.
It is not always an easy task – deep reflection prompts demanding questions, and the process competes for time and resource away from day-to-day operations. In addition, recruiting the skills we need is challenging, requires competitive salaries and hospices must be forward thinking to attract the right people.
Final food for thought
Fair statutory government funding is essential to the sustainability of hospice services and must be continuously and relentlessly pursued. Hospices are leaders and experts in the delivery of palliative care, however what is not always recognised is their tenacity and ability to financially survive through commercial skill and innovation, out with statutory funding, while making a significant contribution to NHS services, and lessening their financial burden.
Laser focus on effectiveness, efficiency and commercial innovation is a real consideration for hospices, as we tackle our current social and economic situation and increased demand for support.
"Our new strategic direction both in the delivery of palliative care and financial models needs to be bold and fresh to make us stand out."
The benefits of strategic renewal outweigh the negatives, providing a greater impact for those we serve and a greater sense of collective purpose across the charity’s staff, board, statutory funders, stakeholders and our communities.
Collaboration is a wise choice and can be with commercial, charity or healthcare partners, we have the choice as independent charities, who we wish to partner with. Collectively we are more effective and can provide the answers and the framework for recovery.
"We have nothing to fear, except fear itself", ~ Franklyn D Roosevelt
About the author
Rhona is a highly experienced senior healthcare director with a strong history of redesigning healthcare models and a special interest and education in cancer and palliative care. She was appointed CEO of the hospice in 2008.
Her passion and strong commitment to Glasgow saw her successfully lead a £21million capital fundraising appeal to provide the city with a new hospice.
She is a past chairman of the Scottish Hospice Leadership Group and a former member of the council of The Scottish Partnership for Palliative Care, in addition to being a Director of Glasgow Chamber of Commerce Council.
Rhona was awarded the Order of the British Empire (OBE) for her exceptional contributions to the field of palliative care and her efforts in expanding the reach and impact of The Prince & Princess of Wales Hospice in June 2023.
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