The Existential Threat to the National Health Service.
I am not given to hyperbole but I honestly believe the NHS is facing an NHS Existential Threat. By this I mean that it is possible that, within four years, the NHS as we know it will have ceased to exist. When I say as we know it, I mean largely in public ownership, available to eligible patients on the basis of need, not the ability to pay and, accepting current exceptions, free at the point of delivery.
What is the nature of the existential threat?
Everyone involved in running or delivering the National Health Economy has heard of The Nicholson Challenge. In his Annual Report 2008-9, the Chief Executive of the NHS, Sir David Nicholson, announced a £15-20 Billion hole in future NHS funding. This can be found on page 47 of NHS Chief Executive’s annual report 2008/09. This states:
Looking ahead to the next Spending Review, we need to be planning for a much tighter financial environment than we have had in recent years. We need to start that work in earnest now.
We know that NHS investment will grow by 11 per cent over the next two
years. That growth will be locked in on a recurring basis, so we have a real opportunity to prepare for harder times. After those two years, we must be prepared for a range of scenarios, including the possibility that investment will be frozen for a time. We should also plan on the assumption that we will need to release unprecedented levels of efficiency savings between 2011 and 2014 – between £15 billion and £20 billion across the service over the three years. This is so that we can deal with changing demographics, the implementation of the regional visions and cost pressures in the system. That level of productivity gain can only be realised through the kind of quality improvements and advances in innovation described earlier in this report.
This £15-20 billion of efficiency savings is from where the threat to the NHS comes. This blog will not favour one political party over another. It does, however, need to be realised that the Nicholson Challenge predates the last General Election and Andrew Lansley’s bottom-up Clinical Commissioning Health Reforms.
Not many people are aware that the new Clinical Commissioning Groups that replaced the old Primary Care Trusts have one statutory objective – to deliver a 1% surplus within an operating year. A large Clinical Commissioning Group, purchasing services for a population of around 720,000 could receive in the order of £700 million a year to purchase hip replacements, prescriptions, X Rays, Out of Hours Service, Cancer treatments etc. It’s only statutory obligation is, at the end of the year, to be left with £7 million in the bank.
That newly formed Clinical Commissioning Group, led by eager and dedicated GPs, is, however, likely to find that when it speaks to its Hospitals, Community Trusts, Ambulance Services, Mental Health Trusts etc that it will have calls upon its £700 million funding in excess of £730 million. The plan to meet the shortfall, very simplistically, is to strip activity out of the hospitals and to get GPs to do it for a fraction of the cost. This is called the Quality, Innovation, Prevention and Productivity programme or QIPP for short.
The frightening thing for me is that nothing is changing. We have the QIPP agenda and we attend regular meetings to monitor progress. All the right noises are being made but, when you put GPs on the spot and ask ‘Being aware, as you are, of the problems that face the NHS, what are you doing differently when the consulting room door closes?’ The answer is overwhelmingly ‘Nothing different at all.’ This speaks volumes for the dedication of GPs in putting their patients first but the failure to act is posing an existential threat to the very NHS that they all love and support.
What will happen when the new CCGs fail to deliver their commissioning plans within budget has not been made clear. The Department of Health has made clear that CCGs will deliver ‘or else’ (my words – hyperbole I know) . Failure to deliver is not an option according to the Department of Health.
What follows is my personal assessment of what will probably happen in the event of failure to deliver within budget:
Year 1. Chief Executive of CCG sacked.
Year 2. special Measures – Department of Health put Special Task Force into CCG
Year 3: CCG commissioning role put out to tender.
The Nuclear Option
This is the ‘nuclear option’. If the role of the CCG is put out to tender there are likely to be a number of private health companies and partnerships who would bid for that role. This has already happened in the running of Hospital Provider Trusts. If and when this happens, the commissioning of high quality health services that are cost-effective, sustainable and reduce inequalities will become subordinate to a profit motive and the interests of shareholders and/or partners. At the this point, the NHS as I know it, and as the population at large know and love it, will have ceased to exist.
So what should we do? More anon……