The false promise of the self-improving health system

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Over the last 30 years, the English NHS has repeated a peculiar managerial ritual: the development of payments, incentives and contracts to reward health services for performance. Despite the disappointments, national policymakers have remained convinced that their latest round of payment reform would finally create a self-improving health system.

Each iteration of the ritual has ended in failure. Devised to increase activity, the national tariff has continued to focus resources on hospital services when they need to be moved into primary and community care.

Our current combination of piecework payments for hospitals and capitation or block contracts for primary and community care incentivises the wrong things in the wrong places.

Meanwhile, there is little evidence that incentive schemes such as Commissioning for Quality and Innovation have delivered substantial improvements in quality or efficiency.

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