OBJECTIVES: The NHS is meeting efficiency savings through 4 areas: quality, innovation, productivity & prevention (QIPP). There is currently a considerable degree of uncertainty from the Department of Health (DH) as to whether the demand for healthcare is being managed in ways that inappropriately restricts patients’ access to care. Reducing demand and redesigning care pathways to treat patients in the most appropriate setting are key ways of generating savings. However transforming services within a prospective payment driven systems is fraught with difficulty. A review was undertaken of current Health Policies and Independent Government office findings e.g. National Audit Office (NAO) as to the likely reality of achieving efficiency saving via this route.  METHODS: A survey of PCT clusters and NAO findings was undertaken to understand how these policy initiatives were being introduced and to understand the barriers to services transformation.   RESULTS: In 2011-12 47% of PCT clusters reinvested less than a quarter of their cash releasing savings in transforming services. The perceived barriers to services transformation were perceived as; Lack of measures to invest first e.g. in community services; organizational barriers between health & social care including information sharing and  differing financial priorities; lack of influence over acute providers; organizational barriers between acute and community services; some transformations would be better enforced at a regional or national level; staff across patient care pathways do not have the right skills; lack of evidence to convince stakeholders of the benefits of service transformation. CONCLUSIONS: Currently financial incentives do not always encourage providers to transform services or to work collaboratively with each other or with commissioners of care.