Under the "payment by results" system, hospitals are paid a fixed pricefor every procedure they perform, replacing the payment of a set amountregardless of the work carried out.
A limited version of the system was introduced across England in Aprilafter being trialled in foundation hospitals in 2004. Last week, publicspending watchdog the Audit Commission warned that the scheme couldcause less popular departments to close.
Additional concerns have been raised by specialist children's hospitals,which warn that the higher expense of treating children with highlycomplex needs has not been factored into costs.
Alan Sharples, director of finance, information and commissioning at theRoyal Liverpool Children's NHS Trust, said the problem was the "numberone topic" of discussion among children's hospitals.
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