The NHS is entering a new era. After years of relative plenty, the health service faces a period of austerity and a ‘perfect storm’ of rising costs and growing demand fuelled by an ageing population and increasing patient expectations.
Scenarios on the extent of the financial squeeze and the implications for public spending were set out in a joint report by the King’s Fund and the Institute for Fiscal Studies this summer. The next government will have little room for manoeuvre; if they commit to protecting NHS spending they will have to make serious cuts elsewhere. Even under the most optimistic of the scenarios, the NHS will have to make substantial productivity gains to keep up with rising demand.
So what do these tougher times portend? How will the NHS respond? Will it use the crisis to drive through transformation - raising quality and reducing costs? Or will it resort to ‘slash and burn’ at the cost of patient care as many fear?
In a recent simulation event, Windmill 2009, which involved 60 policy makers, regulators, commissioners, managers, clinicians and patient representatives, participants were given two future scenarios. The event provided a fascinating insight into how the NHS might respond to a serious downturn in the levels of funding.
It was clear that the NHS needs to take action now, to plan for the downturn, and use the next year (when there is still more money in the budgets) to start and make some changes. Both NHS leaders and politicians need to be honest about the scale of the problem. The government must create a climate in which local NHS leaders are able to engage in difficult discussions about the future shape of health services with staff and the public.
There is a danger if commissioners try and micro manage things and ignore the expertise of those on the provider side whether in the NHS, the private or the third sector. Primary care trusts need to take a leadership role to ensure a whole systems response to the downturn working closely with local authorities. They also need a better understanding of the costs and quality of providers and strengthen their ability to use this to inform commissioning decisions.
Change of this order cannot be managed top down. Strategic health authorities and the Department of Health must resist reverting to command and control and instead support local staff in developing their own solutions. Clinical staff will be critical to this.
The findings of Windmill 2009 suggest that slash and burn can be avoided but only if leaders, at every level, step up now and use the pending storm as an opportunity for change.
Anna Dixon is director of policy at the King’s Fund. Windmill 2009 was designed and facilitated by Laurie McMahon and Sarah Harvey of Loop2, and led by Alasdair Liddell, senior associate at the King’s Fund. Windmill 2009: NHS response to the financial storm is a report of the event
