16 September 2005
NHS trusts and private care providers should compete on price as well as quality under payment by results, according to shadow health secretary Andrew Lansley.
Under PBR, national tariffs are set for groups of similar treatments and the government believes this eradicates the need for time-consuming and potentially divisive negotiations on price.
However, in the first of three Westminster lectures organised by the NHS Confederation, Lansley insisted price competition was needed or the market would fail. 'If — and it does depend on this coming first — if the standards required to be met and the quality of information to purchasers and patients is established, then I believe it will be right and secure to permit price competition.'
He added that the market needed a strong regulator that acted more like a competition authority, such as the Office of Fair Trading. It could, for example, block mergers if they reduced competition. Monitor, the foundation trust regulator, should take this role, he said.
Health Secretary Patricia Hewitt and Liberal Democrat health spokesman Steve Webb are due to give the final two lectures later this month.
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