NHS Efficiency Still 14% Below Pre-Pandemic Levels, New Analysis Finds
A major new analysis from the Health Foundation has found that NHS acute hospital trusts in England remain significantly less efficient than before the pandemic, a finding with direct relevance for the residential and nursing care sector, which continues to feel the knock-on effects of hospital capacity pressures, discharge delays and workforce strain.
The report, published on 3 July 2026, examined efficiency data from 110 acute NHS trusts between 2018/19 and 2024/25, measuring how effectively hospitals convert resources such as staff, equipment and funding (“inputs”) into patient activity such as admissions, appointments and procedures (“outputs”).
Key findings
The analysis found that NHS efficiency fell sharply during the pandemic and has yet to recover. Trusts were around 28% less efficient at the height of the pandemic in 2020/21 than they had been in 2018/19, and by 2024/25 efficiency remained roughly 14% below pre-pandemic levels, even though overall hospital activity has now risen above 2018/19 levels.
The underlying cause, researchers found, is that the cost of running hospitals has grown far faster than the amount of care being delivered. Between 2018/19 and 2024/25, measured inputs rose by 30% while outputs rose by only 12%. Notably, the analysis suggests this is being driven less by workforce costs — which have shown signs of recovery, partly reflecting reduced reliance on agency staff — and more by rising operating expenditure, including spending on drugs, energy, supplies and outsourced services.
Variation between trusts
The Health Foundation also examined how much efficiency varies between the best and worst-performing trusts. It found that the most efficient trusts are around 1.6 times as efficient as the least efficient — a gap that has stayed broadly stable since before the pandemic, and one the report describes as modest compared with the private sector, where the most efficient large companies can be roughly three times as efficient as the least.
Crucially, the decline in efficiency was found across almost all trusts, including the best performers, rather than being concentrated among a handful of poorly performing organisations. Researchers say this points to system-wide pressures — such as bed occupancy, delayed discharges, diagnostic capacity and workforce availability — rather than isolated management failures.
The report also noted that trusts with lower measured efficiency tend to be disproportionately teaching and research-intensive hospitals, whose activity may not be fully captured by standard efficiency measures.
Why this matters for care homes
For providers of residential and nursing care, the findings offer important context for pressures already familiar on the front line. Delayed hospital discharges, one of the most persistent drivers of NHS bed occupancy, are closely tied to the availability of step-down and long-term care capacity in the community.
Tim Gardner, Deputy Director of Policy at the Health Foundation, said: ‘The latest monthly NHS performance figures show a health service continuing to operate under considerable strain.
‘Waiting times for routine hospital treatment improved in May, with 65.6% of waits within 18 weeks, but the waiting list increased again to 7.28 million. There is still a long way to go to restore the 18-week standard, and our recent productivity analysis highlights the need for system-wide interventions to improve efficiency across all trusts.
‘A&E waiting times and ambulance response times got worse in June, reversing the modest gains seen earlier in the year.
‘The recent heatwaves have only added to the pressures on services, with the extreme heat leading to surges in demand and operational pressures from overheating wards and equipment failures.
‘The NHS has achieved some important progress towards achieving the government’s top priority of cutting waiting times for routine hospital treatment. However, turning around a struggling health service within a tight financial settlement means trade-offs are unavoidable, and our polling consistently shows the public are most concerned about general practice and A&E.
‘The next prime minister may need to reassess and rebalance the NHS’s priorities and focus more on improving primary care access, addressing bottlenecks in urgent and emergency care and delivering overdue reforms to social care.’
