A non-partisan journal of the left.

High Quality Healthcare- Competition brings Quality?

Sun 10th Jun 2012

Reform - a think tank advocating market deregulation and competition as the way to deliver better quality services (1) - organised a conference on 16th May in Canary Wharf, London, on the theme of ‘High Quality Healthcare’.

The Key Note Speaker was none other than the Secretary of State for Health, Andrew Lansley. Though there were a variety of individuals in the audience, including NHS doctors, journalists from most of the major papers, researchers and a smattering of MPs, Lansley would no doubt have felt at ease as a large part of the audience comprised representatives from private healthcare consortia, such as Circle, Cerner, United Health UK, Capita Health. Monitor, the organisation formed in 2004 to overlook the establishment and regulation of NHS Foundation Trusts2, was also represented. Since the Health and Social Care Act became law earlier this year, Monitor has been given the job of ‘specifying the services for pricing to the NHS Commissioning Board, who will have to agree these with Monitor…Monitor will collect data from providers and design a suitable pricing methodology’ (2).

For an individual like me, who wholeheartedly and unashamedly supports the concept of a state run health system and heads for the streets to join protests at the mere whisper of privatisation, the conference proved to be an eye opening experience.

One of the dominant ideas that emerged during the conference, and which was supported by most of, but by no means all of, the speakers, was that competition increases quality and that greater choice will lead to greater empowerment amongst service users.

I was compelled to ask the following question at the end of the morning’s plenary session: Competition based on quality is all very well but allowing any willing provider to bid for contracts within the NHS could allow for the descent down a slippery slope where contracts are won on the basis of cost. After all, a competition, namely one that takes place on the plane of free enterprise, is designed to have a winner. Those that can produce sleeker marketing, do the job for a cheaper price or deliver a greater dividend to their shareholders- to whom private companies are answerable at the end of the day- have a greater chance of snapping up a contract that might have otherwise been given to an NHS provider. I cited the following example:

A leaked memo from early 2011 showed that an NHS Trust, previously responsible for providing healthcare to 5000 prisoners across the North East of England, was pipped to the post by private healthcare provider, Care UK.

Care UK was awarded the £53m contract though the NHS trust was reportedly ‘‘judged better than the successful bidder on quality, delivery and risk.”. However, Care UK were said to be able to carry out work at a cheaper price than the NHS (3). It is a slippery slope for a competition based on quality to become a competition based on price.

I made a subsequent point that if a hospital were to derive a large proportion of its income from performing a costly procedure, such as hip replacements, and a private health provider were to snap up the contract, this could lead to the hospital losing a large proportion of its income resulting in its potential closure.

It was interesting to note that in the afternoon session a former Minister for Health, from Labour’s days in power, commented that the NHS is a very inward looking organisation that spends too much time pre-occupied with itself. He chastised the Coalition for having made amendments to the Health and Social Care Bill (following immense opposition from all quarters) as such caving in sets a bad example. He insisted that what was needed was for more ministers to stand up and defend the Bill, later stating that the NHS had a poor record of productivity.

The last time I checked, the NHS was there to provide a service tailored to the health of each patient, rather than a cradle to grave production line whose bywords are efficiency and profit.

My question did eventually receive an answer after the second plenary session when one of the speakers remarked that there was nothing wrong with an organisation being able to provide a service for a cheaper price thus allowing an NHS provider to go out of business, as this was the way of the free market. I would like to have asked that if free markets provide for greater opportunity and openness, could this degree of openness not be matched by releasing the NHS risk register?

Few would argue that high standards and patient centred care should be at the centre of the NHS but to me there seems to be a gap in thinking as this is expected to be achieved whilst implementing a £20 billion cut to the NHS budget over the next few years. We risk having a fragmented, underfunded healthcare system where certain services are not provided as there is deemed to be an inadequate need for them or they do not generate adequate profit. The regulations, or lack of, within a free-market system allow for cut-throat competitiveness and undercutting most often seen in the world of business. In my opinion, such modus operandi should not lend itself to a system where lives, rather than commodities or capital are at stake.

It is worth a quick glance at Reform’s major donors kindly published in their website (4). http://www.reform.co.uk/content/2992/support/corporates/corporates

Without trying to create a web of conspiracy theories, I would simply say follow the money.

Cui bono?

(1) http://www.reform.co.uk/content/13610/research/health/high_quality_healthcare
(2) http://www.monitor-nhsft.gov.uk/
(3) http://www.thenorthernecho.co.uk/news/8807239.Anger_as_NHS_loses_prisons_contract/
(4) http://www.reform.co.uk/content/2992/support/corporates/corporates

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