Hunt should remove workforce straitjackets
Financial pressure on the NHS should be a catalyst for innovation and Jeremy Hunt should support organisations that want to break from national workforce restraints, argues Nick Seddon
In a couple of months the Francis report on Mid Staffs will tell us that the NHS needs to become safer and more caring even at a time when dozens of hospitals face bankruptcy.
Some unions will clamour for more funding, but the latest figures from the Office for Budget Responsibility and the Institute for Fiscal Studies show that there is unlikely to be much more cash to splash any time in the next decade.
If we don’t want the NHS to end up on life support, we need transformational approaches that improve the quality and safety of care while saving money. This means thinking big.
‘World class organisations have improved care by improving the management, motivation and culture of their workforce’
As the business guru Michael Porter put it at a meeting I recently attended in Harvard, “incrementalism is debilitating”. The heart of the matter is that we need to dramatically reform the frontline.
Seeking flexibility
First, this is about saving money. Pay accounts for around 60 per cent of an average NHS trust’s costs, but national approaches prevent employers from using their discretion to change working practices (automatic pay progressions mean 60 per cent of staff will receive an average pay increase of 3.4 per cent this financial year).
In the wider economy, business bosses engage staff in a dialogue about how to get more for less, and pressurised NHS trusts now want similar freedoms: in the Foundation Trust Network’s survey last month, every one of its 210 members - more than 90 per cent of all NHS foundation trusts and aspirant trusts - said they wanted and needed more flexible terms and conditions.
Second, this is about boosting productivity. In the Spanish region of Valencia, private companies have taken on the running of a fifth of the hospitals and primary care services. Employee terms and conditions have been renegotiated: hospital opening hours have been dramatically increased, with some operating theatres running around the clock, which was previously unthinkable.
‘On workforce, the health secretary Jeremy Hunt has sent exactly the wrong message’
Similarly, at the Coxa specialist hospital in Finland, a well incentivised team of surgeons now carry out all orthopaedic services for the district. Specialisation and process design have improved productivity, throughput has doubled, prices have fallen, complication rates are exceptionally low, and they offer a “quality guarantee” giving free revisions after their operations.
Third, this is about higher quality. World class organisations have improved care by improving the management, motivation and culture of their workforce.
Geisinger, an integrated care organisation in Pennsylvania, assigns about 20 per cent of total expected physician compensation to incentives that support improvements in quality and efficiency - and innovation.
The Cleveland Clinic in Ohio publishes clinical outcomes data for each major disease area, which allows hospital leaders to benchmark clinicians and drive up quality. The doctors are on a one year contract and if they’re not up to the job they leave.
Freedom to experiment
The point is not that we should copy wholesale any one of these approaches, but that NHS boards should be free to experiment.
The defensive default is to say that change will automatically be a bad deal for staff. Yet good leaders and managers know that high performance is all about human capital.
Salford Royal Foundation Trust is one of England’s highest performing trusts. Standardised mortality is in the top 10 per cent in the country, infections have plummeted and patients love it.
Salford’s leadership has improved its workforce by: enforcing links between pay and performance; by giving clinical leaders more power and accountability for results; and by putting measurement at the heart of the safety culture for nursing. Staff satisfaction has been the highest in the NHS for two years running.
‘Hunt should give his full support to organisations that want to break from national workforce straitjackets’
As in other public services, the financial pressure on the NHS should act as a catalyst for innovation. For this to happen, NHS leaders must be held properly accountable for performance, including financial performance. Placing South London Healthcare Trust into administration sends exactly the right signal to the rest of the service.
On workforce, however, the health secretary Jeremy Hunt has sent exactly the wrong message. “We are not proposing an end to national collective bargaining”, he said on 7 November. “We are not proposing an end to national pay scales.”
In fact, he should give his full support to organisations, such as the South West Consortium and Foundation Trust Network members, which want to break from national workforce straitjackets so they can improve care quality and outcomes and save money. The ball’s in your court, Mr Hunt.
Nick Seddon is deputy director of Reform. The organisation’s Doctors and Nurses report is available at www.reform.co.uk
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Readers' comments (7)
Anonymous | 29-Nov-2012 2:07 am
http://www.keepournhspublic.com/pdf/Reform.pdf
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Anonymous | 30-Nov-2012 9:06 am
Interesting that in one paragraph the author says, "by giving clinical leaders more power and accountability for results" yet in the very next paragraph says, "As in other public services, the financial pressure on the NHS should act as a catalyst for innovation. For this to happen, NHS leaders must be held properly accountable for performance, including financial performance. "
So which is it to be? You can't have both clinical leaders and (very) senior managers being accountable because invariably that leads to nobody being held to account in the event of a problem.
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Harry Harron | 30-Nov-2012 2:53 pm
In terms of saving money in staffing costs, surely Trusts must be groaning under the enormous costs of the locum doctor workforce. It is simply not sustainable to continue to fund the locum option to the degree which we now see. The number of doctors registering with the GMC from India and Pakistan is plummeting, and the only real solution now is to recruit doctors from other EU countries. With the recession hitting Europe hard, it may just be that the UK can benefit from this "mobile medical work force", but they had better hurry as other countries such as Germany are in a similar situation and they might just beat us to the mark!
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Anonymous | 1-Dec-2012 10:31 am
Nick Seddon knows how to wind people up.
What insight he has into the Francis report I don't know but I suspect it takes a dim view of those that put patient safety and staff stability at risk in the pursuit of unobtainable financial savings.
He needs to look up monopsony in the dictionary. Monopoly purchasing is the way to secure a compromise with staff on salaries and wages costs. Ask the Germans. Ask the procurement gurus who keep trying to save the NHS billions by centralising the procurement of NHS non-pay items.
If he really believes that local pay bargaining will be introduced I and other sharper pencils in the box will set up as agents for the many skilled staff in the NHS who could exploit an NHS market defined both by inexorable demand and chronic shortages of skilled staff.
Our earning will make football agents blush.
Does he not realise that if , as in Finland, orthopaedic surgeons offered to double throughput that commissioners would order them to slow down.If he offers clinicians one year contracts how does he expect to fill the posts, except at higher costs.
Success, as in Salford, has always existed in pockets in the NHS.The trick is to spread success; but too often it is achieved by feeding on failure elsewhere. Moving the money around proves nothing and only adds risk, uncertainty and wasted effort.
As for the lessons of the South London Healthcare Trust....It seems he has not read the administrators report. It recommends the Trust receive £22-25m per annum compensation for the excess costs of PFI deals that funded its hospitals developments ten years ago.If that money had been available there wouldn't have been a South London Healthcare problem, closures of services at Sidcup or the appointment of the administrator.
How does it make NHS leaders accountable if they have no choice but to sign PFI deals whose terms are circumscribed by DH advisers and Treasury officials?.
He ends advising Jeremy Hunt to tear up national pay scales so that people can "improve care quality and outcomes and save money". I've heard that formula before- from those looking to close A&E depts, maternity units and paediatric departments and to push many local hospitals into a spiral of decline.
My advice to Jeremy Hunt is to ask whether you want to see your local hospital influenced by people who who dont know what they are talking about. There are no votes in incompetence.
Apparently Nick Seddon has written a book about healthcare. Its available for 0.01p on Amazon. Says it all...
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Blair Mcpherson | 1-Dec-2012 12:44 pm
So pay them less and we will get better services. Has that ever worked before anywhere?
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Anonymous | 5-Dec-2012 11:38 am
I love the way these proponents of market led health systems pick and choose individual examples of private provision providing more effective and efficient services.
Odd that none of them ever seem to dwell on the fact that every single one of the national health systems with their brilliantly efficient mix of public and private provision that they reference so readily costs a damned sight more as a percentage of GDP than ours does.
Almost every paragraph of this article screams "I am an ideologue with almost no grasp of the reality of healthcare provision", and I suppose I shouldn't expect anything else from a journalist and think tank wonk with no background in healthcare, other than as a spin doctor for Ali Parsa.
Anon on the 1st December makes the most telling point on this proposal. Local free collective bargaining makes savings for employers only where the available workforce outstrips the jobs on offer. And for a significant chunk of the healthcare workforce (and the most expensive chunk) the boot is very much on the other foot.
Every one of us that has ever worked at an acute trust knows damned well that if you rip up national pay and conditions then for every pound you might save on screwing a little bit out of the pittance paid to porters, cleaners and HCA's , you'll lose a tenner on the insane wage inflation you'll cause for highly skilled, difficult to recruit clinical staff.
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Anonymous | 5-Dec-2012 12:01 pm
So a big private healthcare provider funds a think tank formed by a couple of Tory insiders that promotes the "Reform" of public services, including an increase in the private sector provision of health services.
When that think tank's deputy director leaves to become a Tory MP they hire a spin doctor from another big private healthcare provider to take her place. He writes articles for newspapers and magazines that promote the ideology of his think tank and the interests of his "corporate partners".
So no suprise really that in an article ostensibly about local pay negotiations in the NHS more than half of it is filled with shameless promotion of the achievements of private healthcare providers in other health economies.
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