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The NHS “car crash” and PMI

July 21, 2011

At the time of writing, the BMA were still objecting to the Government’s NHS reforms.  Despite “winning” they seem to want humiliation. Even where we are now was rightly, in my view, described by Alan Milburn as a car crash and here is why.

At local level, we will have clinical commissioning groups (rather than GP consortia) which will commission services for their areas (rather than simply patients registered with them).  The governance of these groups will include a local NHS hospital trust doctor – which will blur the distinction between NHS provision and commissioning.  In parallel with this clusters of Primary Care Trusts, which were to have been abolished, will remain for some considerable time.  They will probably operate like the District Health Authorities of old – by ensuring “integration” (a much used word in the listening exercise) and reducing the commissioning/provision split.  Finally we have Health and Wellbeing Boards which will be set up by local councils.  Their powers have now been increased considerably – to encourage joined up working between health and social care sectors.  In theory this is a good thing – in practice it may mean further raids on health spending to make up for reductions in social care spending and “political” interference in big local decisions about provision of hospital services.

At National level we have the NHS Commissioning Board, the Secretary of State for Health and the Regulators (and in particular Monitor – the financial regulator).  The Secretary of State’s powers to influence the Commissioning Board have been reduced and the power of Commissioning Board itself has been fettered if it wants to intervene to encourage say hospital closures or mergers – it’s now a bit like planning decisions for major infrastructure projects.  As for Monitor, it will now not have a duty to promote competition.  Instead it will only be able to tackle anti-competitive behaviour – and that power is itself fettered by changes to the rules on the National Tariff pricing system (to enforce uniformity, no price competition, no “cherry picking” of easy to treat patients, and no duty to provide access to NHS facilities when someone moves from private to public care).

As for patients and the public, much more power is to be given to the “collective voice of patients and carers” at National (Health Watch England) and local level.  Their views on services will carry much greater weight than at present.  In addition, there will be requirements for public consultation exercises and forbidding NHS Foundation Trusts from having closed meetings.  Patient choice, on the other hand, takes a back seat.  The aim is integration and uniformity.

The result is to return us to the period before the NHS reforms of the Kenneth Clarke – with added bureaucracy.  Power returns to public hospital providers to act in their own interests.  Levers to make savings through price competition, mergers of hospitals, changes to service provision to make them more efficient (by closing some and creating centres of excellence), and patient choice are removed.  So when it comes to achieving the huge savings that the NHS has to make over the next few years this can only be achieved in the old way too – cutting out “non-essential” treatment or increasing waiting times.

So while the reforms are extremely bad news for private sector providers they are likely to be good news for PMI.  The gap between what you get through the NHS and what you can get through a PMI policy is going to increase.  Those who can afford it will vote with their wallets.

Written by Richard Walsh, Director and Fellow at SAMI Consulting

Published by Cover Magazine, July 2011, Click here to view published article

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