Analysis Comment NHS Long Term Plan Private Providers
"Stroke of a pen" can end NHS competition… but are the privateers still smiling?
By Paul Evans January 25, 2019
The government has the power to overturn NHS competition rules without the need for new legislation, according to an analysis by health academic Peter Roderick.
It means that ministers could grant the request of NHS England to end the much criticised competition rules within the NHS, which it made within the NHS long term plan.
Under the current rules NHS commissioners are obliged to advertise contracts, which has resulted in over £25bn worth of NHS clinical work being put out to tender, according to figures from the NHS Support Federation.
Nearly 40% of the value of the awards has been won by the private sector.
The failings of the tendering system have made it unpopular throughout the NHS. It has disrupted the planning of healthcare and wasted precious resources. It is seen by NHS leaders as dead wood, where only six years ago it stood as the central pillar in the biggest reorganisation in NHS history.
Even the 2017 Conservative manifesto admitted that the NHS market "can fail to act in the interests of patients and creates costly bureaucracy"
NHS England want new legislation, admitting that without it, the new structures that they are introducing will be weak on governance and accountability. However, the Tories wafer thin Parliamentary majority makes new law unlikely, which is where Peter Roderick's intervention comes in. It means the government could start to repair the damage from the Lansley era, and do it right away.
In a letter to the Guardian the academic from Newcastle University writes "The act only empowers the government to require tendering and the requirement is imposed under secondary legislation – the National Health Service (Procurement, Patient Choice and Competition) (No 2) Regulations 2013. These can be revoked with the stroke of a ministerial pen."
So the competition regulations can be altered quickly and easily without further legislation, but why haven't they?
The Guardian predicts that it's only a matter of time, as Downing Street has given its approval for the NHS plan.
Surely this is bad news for Richard Branson's Virgin Care and the fleet of privateers that have won over £10bn of NHS clinical contracts?
Maybe not. The Independent Healthcare Providers Network, a group made up of private providers of healthcare, has welcomed the long-term plan's aim to develop integrated care systems, as they believe the emphasis on working with local partners will include independent sector providers.
"To further promote more integrated models of care, we welcome the Plan's emphasis on the NHS working with its local partners, including independent sector providers, to produce and implement plans that meet the needs of local people."
Social Enterprise UK, which represents over 100,000 social enterprises, has also welcomed the NHS's new Long Term Plan which calls on the NHS to continue to work with social enterprises who they claim are leading innovators in community health care and provide over a third of all community health services.
Outsourcing remains?
So even if the competitive tendering system is dropped – in line with NHS England's request, could its replacement still fuel further outsourcing, to both private companies and charities?
The NHS long-term plan confirmed that Integrated care systems will be introduced in all the 44 areas across England. It means closer working between the NHS, councils and other providers.
In most areas integration is at an embryonic stage. Organisations work in loose partnerships, but the NHS England's aim is to steer every area towards having one lead organisation. This organisation will Inevitably have to subcontract a whole range of health provision to other providers.
So who will win this multitude of subcontracts? NHS England say that in the future the NHS will have ability to choose to keep more of this work in-house, but clearly from their reaction the private sector and the charity sector are not discouraged by the new system.
NHS England argue that it will be different system and will rest on a "best value test" to secure the "best outcome for patients and the taxpayer", but as yet there is no detail about how this will be work.
New for old?
Healthcare lawyers have speculated that the new system will very likely share some of the features of the old.
Mary Moody of DACBeachcroft says
"It is difficult to see, however, how there could ever be no competition, or at least the testing of quality and pricing of providers, particularly following the lessons learned from the Uniting Care Partnership failure (that triggered the development of the ISAP by NHS England and NHS Improvement) and the Carillion collapse."
The new best value test "will be difficult to do without some market engagement and testing."
Reassurances
Detail is lacking, but ministers have been keen to reassure.
'Big private health companies' won't run integrated care screamed a headline in the Health Service Journal. Health secretary Matt Hancock, speaking out to calm the controversy that has built up around the role of the private sector.
However despite this verbal commitment NHS England have not written private providers out of the new contracts which the lead provider in each area will sign.
The health secretary's pro-public sales pitch would have been more convincing had he not also appeared to back a commercial venture by Babylon to sell digital healthcare to GP surgeries.
So who can blame the public for a modicum of suspicion?
Thinking back, the Lansley legislation was preceded by warm words too. Competition would allow patients to call the shots; giving choice and control about how, when and by who they would be treated. Of course the reality is very different.
For years ministers have issued flat denials of any privatisation, whilst all shapes and sizes of odd experimentation with the private sector were taking place, often followed by headlines about spectacular failure.
Contracts have collapsed, companies have walked away and the NHS has been forced to pick up the bill, a few low-points spring to mind;
Co-performa was forced to give up the £63m contract to provide ambulance services in Sussex after the service fell into chaos leaving patients stranded and missing appointments.
Circle pulled out of its 10-year contract to run Hinchingbrooke hospital in Cambridgeshire – the first NHS hospital to be run by a private firm – after financial problems and heavy criticism from the Care Quality Commission.
Rated as "inadequate" by the Care Quality Commision, Primecare, announced in September 2017 that it would be handing back a contract to provide NHS 111 and GP out-of-hours services contracts.
Dozens of people were left with impaired vision, pain and discomfort after undergoing operations provided by the private healthcare company Vanguard Healthcare under contract with Musgrove Park Hospital, Taunton.
The point to learn is surely that there is an unacceptably high risk in handing over the care of NHS patients to private companies. Many have failed to make profit and have abandoned their contracts or have been caught compromising the care of NHS patients in the process.
Which future?
NHS leaders may want to stop it, but the tendering machine keeps on turning. This week it was confirmed that a £1bn contract to provide NHS community service in the South West was to go out to tender. Confirmation that intervention is needed to turn the machine off.
As for the new path toward integration, it offers many potential benefits, but the controversy about where it leads the NHS is easy to snub out. Convince the public that the NHS is being protected once more, properly funded again. Close the door on outsourcing and build-up NHS capacity.
Of course this is more difficult now, because although ministers deny privatisation has taken place, the NHS has become reliant on their services for some crucial treatments. They carry out a third of all NHS hip operations – many performed by NHS trained surgeons.
Also the private sector are moving into community health because they know that the NHS lacks capacity here and yet, this is the direction NHS planners want to move the majority of patient care, away from expensive hospitals. So the door must be left ajar, as the bottom line is that NHS has not been given the funding it needs to build its own army of community nurses.
Escaping the competition rules would be positive, no doubt about that, but if feels like a side step when we need bold a stride forward. We need new local structures which are truly accountable to the public with proper governance, stripped of the market and that have the funds to focus on planning care to meet need. For that we will need a change in the law and likely a change in government.
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Author Paul Evans
director of the NHS Support Federation
Angela Whitehorn 12 months ago	 Reply
More control given back to NHS less outsourcing, The NHS outsourcing should not be a way for profitering and money wasting.