News story

Reference cost guidance

This news article was published under the 2010 to 2015 Conservative and Liberal Democrat coalition government

Reference costs are the unit costs to the NHS of providing healthcare to NHS patients.

The Department of Health has collected reference costs from NHS providers for every financial year since 1997-98.

Published data

The data collected in reference costs are presented in three ways:

  1. national schedules of reference costs - these show the national average units costs derived from the unit costs of NHS provider
  2. reference costs index - a measure of the relative efficiency of NHS providers
  3. database of source data - this allows a more detailed analysis of organisation level costs.

Collection guidance

The submission of reference costs by NHS organisations is supported by detailed guidance published each year by the department.

Unify2

Unify2 is the Department of Health’s corporate data collection system, used to collect reference costs. As well as collection materials, it also includes a discussion forum in which NHS costing practitioners can seek advice from others. An N3 connection (NHS staff only), user account and password are required.

Governance and review

An advisory group of NHS costing professionals and other partners supports improvements to the reference costs process. In 2010, the department, in partnership with the Audit Commission, published findings from a joint review of reference costs as well as the department’s proposed response.