NHS reform mythbusters

There has been much controversy and debate about the proposed NHS reforms, and the current state of the NHS. We thought it would be useful to pick up – and debunk – some of the myths that have been generated in the debate so far.

Myth one: the NHS is performing poorly compared to other countries' health systems

When it comes to health results and health care quality are we lagging behind other nations or leading the field?

What have we found?

Our review of NHS performance since 1997, published last year, identified that the NHS has made significant progress over the past decade, with a number of notable achievements.

• Hospital waiting times reduced dramatically from 1997-2010, with more than 90 per cent of patients waiting less than 18 weeks for treatment last year.

• Infant mortality has fallen and life expectancy is increasing for all social groups.

• Smoking rates have fallen, and deaths from cancer and cardiovascular diseases have been steadily declining.

• Infection rates for MRSA and C. difficile have been significantly reduced, and there are now robust systems for collecting and analysing information on adverse events.

• In mental health services, access to specialist early intervention and crisis resolution teams is considered among the best in Europe.

• There is now far more information available to patients, professionals and the public about how services perform.

What other evidence is there?

Our analysis is reflected in national and international surveys:

• According to the 2011 British Social Attitudes Survey, 64 per cent of people are satisfied with the NHS, a record high.

• The UK was ranked second in an assessment of health systems in seven countries published by the Commonweath Fund in June 2010.

• In November 2010, a Commonwealth Fund survey of 11 leading nations found that people in the UK have the highest levels of confidence in the effectiveness and affordability of health treatment.

However, while good progress has been made, performance needs to improve in a number of areas before the NHS can be deemed truly world class. For example:

• Although cancer survival rates have improved, international comparisons show we still lag behind other countries in survival rates for several types of cancer.

• While infant mortality has fallen, recent analysis published by the British Medical Journal suggests that UK child mortality rates are higher than in many other European countries.

• NHS productivity has declined by an average of 0.2 per cent a year since 1995 according to estimates by the Office of National Statistics.

• While progress has been made in reducing smoking, there have been increases in alcohol consumption and related hospital admissions, and obesity rates have risen significantly.

• Inequalities in life expectancy between rich and poor have widened, even though life expectancy is increasing for all groups.

• Support for people with long-term conditions is inconsistent and people continue to be admitted to hospital for conditions that could be managed in the community.

• Variations in the quality of general practice and in the treatment provided in hospitals remain persistent and widespread

Myth two: the reforms will lead to privatisation of the health service

The NHS has always involved a mixture of public and private provision. For example, most GPs are not public employees but rather independent contractors to the NHS. This was part of the settlement struck with GPs when the NHS was established in 1948. Dentistry is another profession that has remained largely outside the NHS while receiving NHS funding.

What is the current situation?

In recent years, the NHS has become an even more mixed system, particularly in England. Reforms introduced by Labour saw private sector organisations becoming involved in new ways. For example, from 2003 the government commissioned around 35 new 'independent sector treatment centres' (ISTCs), with the aim of helping the NHS to reduce waiting times for hip and knee surgery, cataract operations and other procedures. These treatment centres are owned and operated by private companies, but are contracted to provide services exclusively to NHS patients.

Despite this increasingly complicated picture, the NHS today remains a public system, funded by public money, and delivered mainly by publicly owned providers. ISTCs, for example, perform just 2 per cent of all elective (planned) operations funded by the NHS. In some clinical areas, such as mental health, the proportion of private and voluntary sector provision is far greater than others.

How would the reforms affect this?

The current government’s proposals would open up the NHS to greater competition, with the aim of creating a level playing field between NHS, private and voluntary sector organisations and driving up quality of care.

Under the 'any willing provider' system, patients can choose to be seen by any qualified organisation that is registered with the necessary regulatory agencies, willing to accept NHS prices and agrees to the terms and conditions laid out in the NHS contract. The any willing provider system is already in use for some kinds of health services – Labour introduced it for elective care in 2008 – but the current plans would extend it to new areas such as community services. Importantly, Monitor, the new economic regulator, would be given concurrent powers with the Office of Fair Trading to ensure competition operates fairly in the health system.

The reforms may, over time, result in an increase in the proportion of NHS-funded care delivered by private and voluntary sector organisations; this will depend on both commissioners and patient choice. There could also be new opportunities for organisations to provide support services to the commissioning side of the NHS. Commissioning consortia are likely to need considerable assistance in performing their new role as the custodians of NHS money, and many may choose to purchase such support from the private or voluntary sector, as PCTs do now.

However, the extent of the increase in private sector involvement in the NHS, and the speed at which it might take place, are far from certain. Given the tighter financial settlement for the NHS, the business opportunities for private sector organisations may not be as lucrative or as immediate as some commentators have suggested, with a number of major firms recently pulling out of UK markets for health service delivery and/or commissioning support services.

Myth three: the reforms are evolutionary not revolutionary

Commentators are split between those who believe the reforms are revolutionary, introducing policies that have not been considered before, and those who see them as a continuation of the former government's health proposals.

The case for evolution

Some major strands of the proposed reforms take forward policies that were already in progress under the previous government. For example, giving GP practices a leading role in deciding which health services to secure for their local population has already been implemented in some areas through the voluntary 'practice-based commissioning' scheme (although GPs get to work with only 'virtual' rather than real budgets). Giving all NHS trusts greater freedoms by requiring that they achieve foundation trust status was also underway – the last government's original target was for 2008, although this was eventually put back to 2014, the date the coalition has now adopted.

The Labour government had also introduced choice and competition into NHS-funded hospital care: all patients referred to hospital for non-urgent treatment can currently choose between any NHS or private sector provider that is registered with the Care Quality Commission, willing to provide care at NHS prices and holds a contract with the NHS.  In other words, an 'any willing/qualified provider' model.

There is also already an independent authority to oversee competition in the health service: the Co-operation and Competition Panel (CPP). The Panel investigates potential breaches of co-operation and competition rules laid out by the Department of Health, including the requirement to support patient choice and to commission services in a transparent way from 'providers who are best placed to deliver the needs of their patients and population'.

So do the coalition government's reforms represent more of the same? Not quite.

The case for revolution

The proposed reforms involve a radical shift in budgetary responsibility with the majority of NHS funds shifting from primary care trusts (PCTs), who are closely supervised by strategic health authorities (SHAs) and the Department of Health, to GP commissioning consortia. A new NHS Commissioning Board will oversee the consortia, as well as taking on responsibility for commissioning specialised services. The Board's role is intended to be 'quasi regulatory' rather than managerial. The local and regional management of the service is being completely removed through the abolition of PCTs and SHAs. The leadership of public health is to be transferred from the NHS to local authorities. And perhaps most controversially, competition between health service providers is being pushed with increased vigour.

Under the reforms, Monitor would take on a new role as an economic regulator, and would be charged with 'promoting competition' in the service. Up to now, the Department of Health has in practice played this role, setting NHS prices and making decisions on the basis of CCP recommendations. In future, Monitor will be responsible (together with the NHS Commissioning Board) for setting prices and, in cases where an organisation is in breach of its licence, will have the power to issue fines and to direct the organisation to take particular actions. This is a completely different type of body to the CCP, which has no enforcement powers of its own.

These major changes to the service are being driven forward simultaneously, and with speed. The Secretary of State published the blueprint for the reforms within two months of taking his post.

Myth four: the NHS has too many managers

Recent media coverage and parliamentary debate suggests that the NHS is bureaucratic and over managed. The argument goes that much NHS management is unnecessary and that over the past decade the number of NHS managers has increased at a rate disproportionate to need and to the wider growth of the NHS.

The government's White Paper Equity and Excellence: Liberating the NHS and the revision to the 2010/11 NHS Operating Framework that followed it shows the government's plan to reduce management costs by £850m (46 per cent) by 2013/14.

The King's Fund recently looked in detail at these issues as part of its Commission into Leadership and Management in the NHS.

How many managers are there in the NHS?

It is extremely difficult to find an accurate figure for the number of managers in the NHS, and most sources of information use different definitions for who is counted as a manager. Best estimates suggest that the NHS spends roughly £8 billion of its £100 billion budget on management and administration. The NHS Information Centre shows that there were about 43,000 NHS managers in 2009 (about 3.7 per cent of the total workforce), although this figure does not include many clinical managers.

How does this compare to other sectors?

According to the Office for National Statistics, the proportion of managers in the UK workforce as a whole in June 2010 was 15.4 per cent. These statistics also show that there were 77,000 hospital and health service managers across the United Kingdom, or 4.8 per cent of the NHS workforce. In other words, the NHS has a managerial workforce that is one-third the size of that across the economy as a whole.

The majority of managers in the NHS are employed in NHS provider organisations (hospitals, general practices and community services). Most of the management cuts in the NHS will come from the abolition of strategic health authorities and primary care trusts (PCTs) rather than from NHS providers. A submission to The King's Fund's Commission calculates that PCTs in England spend around 1 to 2 per cent of their budgets on management and 'only the most outstandingly frugal charities spend as little as 1 per cent of their turnover on management'.

Has the number of managers grown?

Using data from the independent Binley's Database of NHS Management, research by Manchester Business School for The King's Fund Commission on Leadership and Management in the NHS found that the numbers of NHS managers in England had risen by 37 per cent between 1997 and 2010 – a period in which health spending doubled in real terms.

While the number of NHS managers has grown in England since 1997, figures for the other three countries of the United Kingdom are static or falling. There may be a range of reasons for this, but since 1997 England has seen a plethora of policy initiatives that have increased the requirement both for management and administration. These include targets for waiting times; new regulators; published measures of hospital and PCT performance; expensive staff and patient surveys and more extensive contracting out of a wider range of support services than in Northern Ireland, Scotland or Wales.

Myth five: GP commissioning will damage the doctor-patient relationship

Over the last quarter of a century, doctors have consistently been named the profession most trusted by the British public. The most recent (2009) MORI survey on this issue showed that 90 per cent of those questioned believed that doctors told the truth compared to 13 per cent for politicians.

The GP surveys conducted for the Department of Health also show that patients have high levels of satisfaction with their GP. In 2010, nine out of ten patients were satisfied with the care they received at their surgery and over half of patients were ‘very satisfied’ (54 per cent). Only four per cent of patients were dissatisfied with the care they received. This suggests that the current doctor-patient relationship is highly valued and that the public place a significant degree of trust in doctors as professionals. How might the changes proposed by the Health Bill threaten this?

What does the Health Bill propose?

The Health Bill proposes that all GPs will need to be a member of a GP commissioning consortium in order to have a registered list of patients. The consortia would hold £60 billion of taxpayer's money and commission the majority of hospital and community health services for patients. It is proposed that an element of GP pay would be linked to their consortium's commissioning performance.

What might be the dangers in these reforms?

If patients believe that GP decision-making is being influenced by personal financial gain this could erode their trust in GPs as professionals. The British Medical Association has raised concerns about this issue.

There are two key ways in which financial considerations and patients' clinical needs potentially come into opposition and could reduce patient trust.

The first is at the point of referral. In the future, patients may believe that a GP has decided not to refer them for specialist treatment not on clinical grounds but solely because they want to keep the consortium within budget (as the GP would gain financially from this). Evidence suggests that many patients seek referrals that they don't necessarily need clinically, putting GPs in a particularly difficult position.

Further threats come from the proposed changes to the role of the National Institute for Health and Clinical Excellence (NICE). While NICE will continue to undertake economic assessments of new drugs, it will no longer be compulsory for GPs or providers to abide by NICE guidance. It creates the possibility in a patient’s mind that GPs might make and support prescribing decisions on economic rather than clinical grounds, again undermining trust. Both sets of circumstances underline how important it will be for GP consortia to have strong governance and transparent decision-making processes.

What might be the benefits in these reforms?

On the other side of this argument is the experience of GPs who have already been actively engaged in commissioning, many of whom have worked very closely with patients in developing services and taking commissioning decisions.

For example, the GP commissioning group Principa follow the principle that not a single decision should be made without patients being involved from the outset. This principle has brought patients closer to GPs and strengthened rather than damaged the doctor-patient relationship. It is likely that GP consortia will be required to provide evidence of how they plan to engage patients in consortia work.