NHS providers as priority—a policy shift?

Civitas, 21 September 2009

The Financial Times is claiming health secretary Andy Burnham’s recent statements advocating NHS organisations over independent bodies as providers of state-funded health care backpeddle on current policy.  

“The NHS is our preferred provider,” Burnham said last Thursday in a speech to the King’s Fund. He explained that NHS organisations should be given the chance to improve performance or to offer new or redesigned services before primary care trusts (PCTs) and GP commissioners put such opportunities out to tender.

Favouring state-funded providers within a state-funded health system may not seem to be much of a contradiction, expect that for the past eight years DH policy in England has focused on introducing provider competition (including inviting private and voluntary healthcare organisations to set up business) and reaping the theoretical market benefits of increased quality and customer (i.e. patient) satisfaction. Independent providers are already finding it hard to break into the market due to inability to access the low-interest loans available to government bodies and to offer public service pensions, then additionally face the obstacles of comfortable, prevailing, local purchasing relationships.

Burnham said to the Financial Times: “It seems to me right and fair that the existing staff get the opportunity to respond to new requirements” first, rather than automatically face the “destabilising” process of a tender. This does seem to be a fair point—something the DH should also consider regarding its rampant use of management consultants.

But this new idea is in direct contrast with existing competition regulations, which dictate that PCTs put all new or significantly changed services out to tender and must explain their actions if they choose to do otherwise. Is this a move to appease unions or other lobbying groups that adamantly oppose marketisation, such as the BMA? How is the NHS going to meet the projected necessary £15bn to £20bn in savings over the next few years while covering the nation’s increasing healthcare demands on its own?

The FT states that Burnham denied demoting the use of private and voluntary sectors in health care to “a last resort,” but it does sound as if that’s what he is intending, does it not? An option that is there when needed, but not one he wants to be seen supporting. Why the turn-around?

A clearer policy stance is needed here.