WHAT WILL THE NEW MARKET IN HEALTH CARE MEAN FOR THE PROFESSIONALS WE EDUCATE?

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WHAT WILL THE NEW MARKET IN HEALTH CARE MEAN FOR
THE PROFESSIONALS WE EDUCATE? Sally Ruane
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Context two political choices

• Tackle the deficit primarily through public
  spending cuts
• Undertake complex top-down reorganisation in this
  context

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Financial environment

• Promise of real terms increase plus protected
  funding
• 0.1 p.a. real terms rise
• 15-20bn efficiency savings (5 p.a.)
• Reorganisation costing 2-3bn
• Transfer of 1bn out of NHS to LAs for social
  care (not ring-fenced)

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Implications

• Increase experienced as a cut
• Cuts to services
• Job insecurity
• Back office, front-line, management

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Financial aspects of GPCCa

• GP Commissioning Consortia (GPCCa) must bear
  financial risk
• But patient populations are small and funding
  formula may not work
• General financial squeeze

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Financial aspects of GPCCa (cont.)

• High admin costs of health systems run as
  markets
• 6 budget (70s) 14 (2003) 15-20?? 2010
• Proliferation of 500 consortia even higher
  admin costs?

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Implications

• Financial viability of some consortia at risk
• Pressure of financial risk and constraints will
  ripple out to staff in primary care and in other
  sectors of health contracting with GPCCa
• Mergers?

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Quality

• Financial squeeze
• New market will re-introduce price competition
• Economic theory and empirical evidence
• Safeguarding quality nationally?
• NICE Quality Standards not mandatory

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Quality (cont.)

• Licensing arrangements for providers ex ante
  regulation
• Care Quality Commission weak?
• Locally set quality standards but with financial
  constraints
• Performance management of contract - inadequate

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Implications

• Pressure on staff to reduce costs to compete on
  price
• Accommodating a decline in standards?

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Commercialism

• GPCCa a misnomer?
• Commissioning is a largely commercial activity
• Involvement of ex PCT staff out of hours
  provider companies large insurance companies
  operating under FESC (Framework for the
  procurement of External Support for
  Commissioning, 2007)

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Commercialism (cont.)

• So commissioning will involve commercial actors
  and will be a culturally more commercial activity

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Commercialism (cont.)

• Provider side of market
• Tilt market towards more commercial and non NHS
  providers
• Regulator will prioritise rules of competition
• ISTCs private hospitals in Extended Choice
  Network take-over of NHS hospitals

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Commercialism (cont.)

• Commercial providers will
• Seek profitable activity
• Jealously guard innovations and slow
  dissemination of good practice
• Seek to reduce costs staff numbers staff skill
  mix staff autonomy
• Perform to contract (and no more)
• Prioritise the interests of shareholders

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Implications

• skill-mix
• autonomy
• ability to share good practice and utilise
  professional networks to the best
• Denial of treatment?
• Over-treatment?

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Market

• Will the rules of competition become paramount?
• Dynamic or instability?
• Failure regime for NHS hospitals etc which cannot
  remain financially solvent
• Hollowing out of NHS
• FTs allowed to charge for health care

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Implications of market

• Job insecurity and prospect of transfer to non
  NHS employers
• Triple tier workforce
• How much professional energy and resources
  diverted to profitable activity with paying
  patients?
• Organisational fragmentation will vitiate
  professional networks

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Conclusion

• Professionalism in UK health care has developed
  for over half century in a context of public
  service and divorced from the profit motive
• Emergent commercialism will more significantly
  shape the professionalism of the future