BRIEFING: BMA campaign to shut out independent sector from NHS is misguided and foolhardy
James Gubb, February 2010
The BMA today extend their ‘Look After Our NHS’ campaign, to stop commercially run firms providing NHS care and end the market in the NHS, to patients.
Leaflets will be distributed containing stories such as a 70-year-old lady who is forced to go to a treatment centre run by a private provider and suffers ‘complications’.
The BMA is politicising health care on cherry-picked evidence.
The BMA states:
The creation of a market in the NHS has meant an increase in bureaucracy; the number of senior managers in the NHS rose by 91% between 1995 and 2008 – more than double the increase in numbers of doctors and nurses.
The market has increased transaction costs, but a large part of the increase in senior managers is due to:
- The NHS having historically low (and inadequate) levels of managers vis-Ã -vis other health systems.
- The sheer amount of paperwork demanded by the government and numerous regulators to satisfy central requirements.
Many private NHS providers have received millions in guaranteed payments for contracts, despite treating fewer patients than planned; on average, the first wave of Independent Sector Treatment Centres delivered just 85% of activity paid for – suggesting a shortfall of Â£220 million on the £1.47 billion contracts.
This is true. But what is not quantified is:
- The fact quality of care is typically higher in ISTCs than the NHS. For example, the Healthcare Commission found length of stay and rates of readmission to hospital to be consistently and significantly lower in ISTCs than the national average; and patient satisfaction rates to be significantly higher.
- The impact of ISTCs on NHS providers. There is mounting evidence to suggest ISTCs caused NHS providers to drive performance in a way that would not have happened without a competitive threat, such as in Plymouth NHS Trust from the Peninsula ISTC; in Southampton University Hospitals Trust from the Southampton ISTC; and in Yeovil NHS Foundation Trust from Shepton Mallet ISTC.
On GP-Led Health Centres
New ‘GP-led health centres’ have been costly, enjoying on average three times the funding per patient of regular GP practices, despite in some cases very few patients registering with them. The new GP-led health centres were demanded of Primary Care Trusts by the Department of Health.
They were a central initiative and not a market response. What they did do was address the fact that access to GPs is disproportionately better in more affluent areas.
The Private Finance Initiative is now funding over 100 new hospital schemes, valued at Â£10.9 billion, but set to cost the taxpayer £62.6 billion by the time the final payments are made in 2048.
PFI deals reflect more the weakness of public sector procurement and lack of trust on the part of the public sector towards the private sector, than a flawed model per se. The contracts negotiated are inflexible. Many facilities built are inappropriate and governed by rigid rules that make adaptation to 21st century models of health care incredibly difficult.
… a Choice
The NHS is facing a choice. The best estimates are that with zero real growth -which looks likely – the NHS will face a shortfall of £20 billion by 2013/14, rising to £38 billion by 2016/17 vis-Ã -vis need. Productivity improvements are needed on a scale never seen in the NHS’s 62-year history.
The NHS can take the BMA’s route and close its doors to the independent sector, or it can harness the sectors’ expertise (and the voluntary sector’s) by breaking down barriers to entry. The latter is the optimum course:
- NHS productivity has declined by 4% between 1997-2007, whereas average private sector productivity increased by 23% in the same period.
- The liberalisation of other industries is indicative. Regulatory reforms that introduced competition into UK electricity, gas and water industries resulted in ‘phenomenal rates’ of productivity growth of over 10 per cent per annum across the 1990s.
- Evidence from Europe suggests higher performing health systems have a mixed economy of provision.
… Out of Touch
The BMA are out of touch with the public and trying to protect their own from radical changes that will be required:
- The number of patients now choosing to go to independent sector providers at the point of referral has increased from 8,928 (2.3% of Choose and Book referrals) to 26,733 (5.5%) between April 2008 and September 2009. They do not seem concerned by ‘profiteering’.
- In a nationally-representative survey of 2,001 people commissioned by the NHS Partners Network:
- 74% said the NHS needed ‘to change to survive’; and
- 74% more closely align themselves with the statement ‘I don’t mind who owns or runs my NHS services so long as the quality is right’ than ‘Services on the NHS should only be conducted in a hospital or other medical facilities run and owned by the government’.
James Gubb, Director of the Health Unit at Civitas, said: ‘The BMA’s stance goes to the heart of the debate in the NHS at present: whether the financial challenges facing the NHS meant taxpayers’ money should be spent supporting NHS providers, or spent on the provider – NHS or non-NHS – that can offer the best deal on quality and cost’.
‘I suspect most of the public would side with the latter. Affinity lies with the values underlying the NHS: universal, comprehensive health care, free-at-the-point-of-use, rather than who provides the service’.
Notes for Editors
i. Civitas is an independent social policy think-tank. It receives no state funding either directly or indirectly and has no links to any political party. Civitas’s health policy research seeks to take an objective view of health care in Britain. It aims to offer an improved perspective on how best to deliver equitable and high standards of health care for all.
ii. Civitas is currently conducting an in-depth study into how markets are operating in the NHS, due to be published in March.
iii. Civitas and the Socialist Health Association are holding a debate on the future of the market in the NHS on 17 March. See: http://www.sochealth.co.uk/confs/markets.html
iv. The research for the NHS PN survey was conducted among a representative sample of 2,001 English adults aged 18+; Fieldwork was conducted by telephone 1-5 July 2009; Data weighted to the national population profile of England; NHSPN commissioned ICM Direct to carry out the poll on their behalf.