A ‘protect the NHS’ clause needs to be introduced into Lansley’s bill

Cllr Joseph McManners, a GP in Oxford, looks at where-now for competition and the market in the NHS reforms; the views expressed are his own.

The main story today is the publication of the Dilnot report into social care, which Left Foot Forward will have more on later, but what of the coalition’s wider health reforms? Cllr Joseph McManners, a GP in Oxford, looks at where now for competition and the market in the NHS reforms; the views expressed here are his own

With the dust settling after the health secretary’s ‘pause’ and ‘listening exercise’, a key question for the NHS is what has happened to the plans to bring more competition and market forces? Is there a significant change to the plans?

There has been a public, professional and political desire to prevent privatisation of the NHS. Both coalition parties have felt moved to announce this will not happen, and suggested there has been a shift away from policies that encourage competition and new private providers.

Key issues which involved marketisation policies were:

1. Monitor to act as an economic regulator to promote competition;

2. ‘Any Qualified Provider’ clauses to allow registered providers to take NHS patients;

3. Concern over ‘cherry picking’ (related to 2);

4. Opening up of commissioning decisions to EU and UK competition law.

The political presentation of the changes suggests the role of Monitor will no longer be to promote competition, and that there will be safeguarding against ‘cherry picking’.

With 180 amendments to the Health and Social Care Bill published a fortnight ago and debated in committee last week, we need to take a sober look at what the difference will be to the role of the market in the NHS.

The amendments to the bill that are going through committee on this can be seen in the ‘Government response to the NHS Future Forum report: Briefing notes on amendments to the Health and Social Care Bill’ document (pdf). The role of Monitor and ‘cherry picking’ are dealt with in pages 16-21. The role of Monitor will no longer be to ‘promote competition’, rather to “prevent anti-competitive behaviour, which is against the interests of people who use NHS services” (clause 149). If we’re being generous, it is a subtle change.

‘Cherry picking’ seems generally to be understood as the concept that new providers shouldn’t be allowed to design new services that pick off less complicated, harder patients.

The amendments that discuss this problem suggest that non-clinical criteria for rejecting referrals aren’t acceptable, but clinical ones are. Unfortunately, this misunderstands how cherry picking works. Clinical grounds are quite sufficient to exclude complicated and expensive cases (i.e., excluding patients from operations who have had significant medical problems).

The solution suggested is a complex potential redesign of the ‘tariff’, (which is the fixed price for an operation etc), pp 19-20. The idea being that if complexity is accounted for in the tariff, providers would not seek to find easy cases, or at least would be rewarded for doing so. Again, if we’re being generous, this could be described as a complex, top down, market based attempt at tackling this.

The next area that remains unclear is the thorny question of how much the NHS commissioners will have to take into account UK and EU competition law. (See also the NHS Confederation document ‘What do EU competition rules mean for the NHS?’ pdf). There remains a fair amount of uncertainty around this, although this BMJ article explains why commissioners are likely to have to take it into account.

The key aspect seems to be that at present there is a degree of protection as NHS services can be seen as ‘social’ functions, and therefore exempt. Once there is a ‘level playing field’, particularly when Foundation Trusts become more like independent hospitals, the argument for this is reduced.

The amendments to the bill do not seem to address any of the uncertainty in this area. The only thing we can really conclude is that when there is legal doubt there will be a lot of legal activity and legal cost. This is not necessarily the best approach when designing healthcare services. Not only this, but the doubt for commissioners will likely result in a low risk approach, which is to assume EU law applies.

So why does any of this matter?

The key issue is the undermining of local NHS services. If an orthopaedic unit was to lose its physiotherapist, it may be able to cope but if it were to lose its physiotherapist and its simpler operations, it would begin to become unviable. It is important to understand that NHS services work on a cross-subsidy, solidarity basis: many patients are not simple and require a lot of resource. The costs of this are absorbed into the lower risk, lower resource patients.

If this is chipped away, it will be death by a thousand slices. Not only that but if large chunks of NHS hospital work was to be tendered out, patients may find their local options reduced, either directly or indirectly.

These issues were all recognised in the run up to the ‘pause’. As argued above, the solutions are minor, top down, vague, or non-existent.

Is there another way of ensuring the scenarios above, that the public do not want, do not happen? What seems to be needed is a way of commissioning that enables local commissioners to choose to protect NHS services if they and the public wish to, and that also reassures the local public they won’t lose their local NHS services by them becoming unsustainable.

My suggestion is that legislation needs to make it absolutely explicit that commissioners should:

(a). Be obligated to consider when commissioning a service the effect on NHS services;

(b). Have an option to favour local NHS services, as long as they are able to justify it. Reasons can include patient preference, local health needs and wider strategic reasons (for example to prevent losing a whole hospital department);

(c). Then be obliged to publicise this decision and consult local people.

If this is legislated for explicitly, commissioners would have the freedom to commission without fear of bringing competition law onto them. They would also have the freedom to design NHS services that are developed with local people, that look across the whole local health economy and can be assured that precious valued NHS services are not damaged.

It would also remove the need to spend a huge amount of time and resource on legal work; after all, we should be taking into account patients’ interests and views, not lawyers’. Versions of this idea also attracts political support from the Labour party and the Social Liberal side of the Liberal Democrats.

If such a ‘protect the NHS’ clause is introduced to the bill, there would be a genuine change for the good. It would signal the coalition parties are genuine about wanting to protect the NHS from privatisation. The current state of the bill looks like they are not.

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