Costing NHS quality

Philip HuntPhil Hunt on why it’s full steam ahead for the government’s health privatisation agenda

Much of the concern during passage of the Health and Social Care Bill was the evident desire of the government to marketise the NHS. Despite ministerial denials, our worst fears are now being realised as one regulator after another drives forward the privatisation agenda.

The news, leaked yesterday, that Monitor – the NHS’s economic regulator – was looking at exempting private sector providers from paying VAT followed hard on the heels of the bizarre intervention by the Office of Fair Trading (OFT) to halt the merger of two foundation hospital trusts in Dorset.

The latter intervention is unnecessary and comes at a time when the NHS is faced with the cost-cutting challenge of Nicholson and David Cameron’s massive top-down reorganisation, with the latter starting to cause real pressures on the frontline. 

All of this, rather inevitably, entails the re-design of services and the consolidation of more specialist activities to drive up quality. And this may sometimes be underpinned by the merger of two or more separate NHS organisations to allow for major improvements in patient outcomes.

For Dorset, that sensible course of action is now in jeopardy due to the OFT’s heavy handed approach, and referral of plans to merge the two foundation trusts to the Competition Commission for an in-depth investigation. The merger was designed to create centres of excellence by bringing together skills and expertise, and technology promoting safe and sustainable services. It would have brought consultant-led care 24 hours a day, 7 days a week; and promised services more responsive to patients and GPs.

The reference however, to the Competition Commission will put back the proposals by many months and could place in doubt many other sensible reconfigurations of services. 

Although the Dorset merger was clearly designed to increase quality, the OFT remarkably believes that this is trumped by concerns that commissioners will have less choice. And it would seem that it feels the loss of competition is more important than any improvement in services that would follow the merger.

The OFT is now also flexing its muscles to take on the oversight of mergers between foundation trusts and non-foundation trust. This goes well beyond the provisions of the Health and Social Care Act. Essentially, it appears to be saying that non foundation trusts are effectively enterprises and therefore subject to European Competition law.

Any merger proposal of course needs to be looked at carefully; but a series of sensible mergers to consolidate services and improve quality could now be under threat. The OFT seem to have become emboldened – no doubt encouraged by the government – in its determination to force a market-based NHS without considering the impact on patients. 

This gives the lie to ministers’ claims that the competition elements of the Act had been watered down to ensure the integration of services were a priority. In fact, aided and abetted by the OFT and Monitor, the government now seem hell bent on the privatisation of our NHS. 

Lord Phil Hunt of Kings Heath is a Shadow Health Minister and Labour’s Deputy Leader in the Lords

Published 15th January 2013

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