03 October 2008
As the Conservatives gear up for office, they are coming under pressure to spell out what the health service would look like in their hands and where their policies differ from those of New Labour.
With the Conservatives riding high in the polls, attention is turning increasingly to the substance of their proposed policies. As far as the NHS is concerned. shadow health secretary Andrew Lansley gave us some clues at the party's annual conference in Birmingham. More choice, a crackdown on bureaucracy and targets, and a focus on outcomes were among the remedies outlined.
However, with the exception of one or two specific pledges – for example, an independent board and single rooms for patients– Lansley's speech was not long on detail.
Nevertheless, the outlines of a Conservative health strategy are beginning to emerge. Over the past 18 months the Tories have published draft legislation for the NHS and a green paper on improving the health of the nation. These, together with key speeches by Lansley and Opposition leader David Cameron, paint a picture of the sort of NHS we can expect if the Tories win the next general election.
At first blush, the differences between Labour and Conservative policies do not appear that large – not least because the Conservative Party has moved a long way since the 2005 general election, where its policies on health failed to convince.
In particular, the unpopular proposal for a 'patient's passport', where NHS funds could be extracted by patients and set against the costs of private treatment, has been abandoned.
Moreover, Cameron has made several commitments that overtly link his policy to that of the current government. An incoming Conservative administration would honour its commitment to a 'fully funded health service' – although recent Tory concerns about the state of public finances casts some doubt as to how generous this funding might be. A Tory government would also enshrine in legislation the core principles set out in Labour's NHS Plan in 2000, and would make no further structural reorganisation of local NHS bodies.
Many of the themes in health minister Lord Darzi's report this summer, following his year-long review of the NHS, chime harmoniously with the documents and speeches of the Conservative front bench. Both major political parties clearly share a basic vision for the future of the NHS in England.
This future is broadly market based. It has a clear split between purchasers (primary care trusts and GP practices) and providers; has strong financial incentives to improve efficiency and responsiveness to patients; is regulated (at least partly) by independent organisations; engages clinicians in the design and management of the service; and offers far more choice than ever before to patients.
However, while largely accepting the existing framework, the Conservatives have devoted considerable attention to tuning the engine. Their intention is both to make the NHS more efficient and to improve health outcomes. In particular, the main financial incentive system within the health service, 'payment by results' has been subject to a detailed review, with proposals for how it might be reformed.
These include reforming the tariff by which hospitals are paid to reflect the costs of the most efficient providers rather than the average, permitting providers to offer discounts on the national standard price and introducing quality-based incentives for providers.
Cameron and Lansley set out 30 key recommendations in their proposal for an NHS Autonomy and Accountability Bill, published last year. These were augmented this year by a green paper devoted to improving health outcomes. Some of these recommendations, while innovative, perhaps had their thunder stolen by the Darzi review.
For example, the Conservatives' proposal for patient-held budgets for people with long-term conditions such as diabetes or heart disease is mirrored by a new national pilot programme that will start next year. Much more power and 'real' budgets for GP-based commissioners are echoed in the new 'integrated care organisations', pilots of which will kick off this autumn. Better comparative information for patients (including 'patient reported outcome measures'), essential if the Conservatives' dynamic vision of the market is to succeed, has been highlighted as part of the government's plan to expand the NHS Choices website.
However, where Conservative policies do begin to diverge more sharply from those of the current government is in their recommendations to reform the political and regulatory accountability of the NHS .
The big distinction they would like the electorate to make between the different policies relates to the degree of control by politicians. The Conservatives, says Cameron, would abolish the 'self-defeating top-down targets' and end the day-to-day interference in the health service by ministers.
This would be achieved by a fundamental change to the political relationship that binds the NHS to the state. The party's 'no reorganisation' commitment does not apply to the Department of Health or the current independent regulator, Monitor.
Under the Conservative proposals, an independent NHS board would be created, with its own chair and executive directors. The board would discharge the health secretary's responsibilities but in an autonomous way, freed from day-to-day political control. The health secretary would agree a set of objectives that relate solely to expected improvements in health outcomes and the board would set commissioning guidelines and standards, and performance manage local commissioners through strategic health authorities and PCTs. The health secretary and Department of Health would be responsible for improving the public's health through action across government.
For their part, providers would be 'set free', in what the Conservatives describe as a 'social market' based on competition and patient choice. This market would contain foundation trusts (and all NHS trusts would be encouraged to adopt foundation status) with enhanced freedoms and more non-NHS providers.
Regulatory structures are also due for a shake-up. This would mean that Monitor would become a general economic regulator responsible for, among other things, setting the NHS tariff, promoting and regulating competition, managing market entry and intervening where the market fails.
The shape of Conservative health policy is now clearer and has been informed by an exhaustive process engaging a wide range of independent stakeholders and experts. So is the resulting recipe a good one?
In many respects, the answer must be 'yes'. But in part, this is because much of what is proposed is not terribly contentious – the overall narrative is not dissimilar to Labour's. Choice, competition, public health are all touchstones for Health Secretary Alan Johnson and Prime Minister Gordon Brown as much as they are for Lansley and Cameron.
Some of the technical issues raised by the Tories are the right ones. For example, research evidence suggests that GP-based commissioners need 'real' budgets if they are to get involved and produce change. Patients and commissioners also clearly need better information with which to compare providers and to hold them to account. The increased focus on health outcomes, with ministerial responsibility for public health extending across government, should be welcomed.
Whether the reforms to political accountability will be effective is a trickier question. Certainly, the King's Fund has argued strongly that an independent board would be a misguided solution to the 'problem' of political interference, preferring instead Darzi's NHS 'constitution'. And can the claim that top-down management through targets will be abolished really be sustained if instead the NHS will be accountable for the delivery of defined health outcomes?
A target to improve health outcomes might be preferable to one that insists on processes, but it is a target none the less.
The Conservatives have demonised what they call 'process targets'. Yet there seems little doubt that such targets have the ability to transform the performance of the NHS, even if they risk perverse outcomes, as the Conservatives point out. For example, national waiting time targets have undoubtedly had unintended, and sometimes negative, consequences at the hospital level. However, they have also reduced waits for hospital treatment from years to months. If targets are to go, something different – and hopefully better – will need to take their place.
And here is the rub. Both Conservative and Labour policies rely heavily on market mechanisms to drive improvements in quality and efficiency within the NHS. How successful this strategy will be is relatively untested. For example, evidence from the US casts doubt on consumers' appetite for using quality information to choose their provider. Other evidence from the internal market in the UK in the 1990s suggests that strong competition might be associated with lower quality of care.
We are still learning about the impact, positive and negative, of markets in health care. But if an incoming Conservative government dismantled central mechanisms for top-down control on day one in favour of a market red in tooth and claw, it would be left with no plan B.
Richard Lewis is a director in Ernst & Young LLP's health advisory practice and a senior associate at the King's Fund
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