Andy McKeon: why money could not unravel the NHS red tape

A change from 18 months to 18 weeks, however it has been achieved, is a notable achievement.

Could more have been bought for the money? Almost certainly, but nobody knows how much more

And it is hard now to think of an NHS without, say, NHS Direct, targets (sorry, standards) for major diseases, clinical governance, a single cash limited budget for primary care trusts, or the National Institute for Health and Clinical Excellence to set standards and judge cost-effectiveness. They were all introduced by the 1997 white paper The New NHS. The tariff and foundation trusts are also regarded as part of the furniture, although the former needs development and a significant number of trusts have not yet achieved foundation status.

Regulation was also a new kid on the block in 1997 with The New NHS’s proposal to establish the Commission for Health Improvement. Since then, regulation and the regulators have had a bumpy ride. Four incarnations later we have the Care Quality Commission. They included the National Care Standards Commission, abolished in less than three weeks. And following the Department of Health’s present review of arm’s length bodies there may be another version on the horizon.

The first change from Commission for Health Improvement to the Healthcare Commission came in response to the Bristol Inquiry. Delivering the NHS Plan in 2002 cited the need for clearer accountability and the fragmented and burdensome existing arrangements as the reasons for the change. But I think the essence of the problem was that ministers wanted to enforce a set of standards, not focus on improvement.

The change to the Care Quality Commission, with its emphasis on registration of all NHS bodies, is the final step in that direction. But there is uncertainty about what the impact of registration will be and still some confusion about which bodies set standards and for what purposes; and an unanswered question about whether the regulators can spot the signs of failure before the catastrophe happens.

The ups and downs of regulation have been part of a trend to reduce ministers’ direct involvement in managing the service. Setting quality standards and assessing performance against them has become non-ministerial business. Other areas have followed - foundation trusts, Monitor, developing NHS Employers to take responsibility for contract negotiations, the Appointments Commission, independent advice on reconfiguration proposals.

System alignment

Criticisms have been made about top-down control through targets and performance management but many of the institutional arrangements have emphasised devolution and limited ministers’ powers. Managing the NHS has become much more complicated since 1997. “System alignment” is the jargon used to describe ensuring all parts of the NHS move together in the same direction. It is what will be needed to address some long standing issues.

Productivity is the most important. Without improved productivity there will be little money to reinvest. It has been the service’s Achilles heel.

The story of the last decade is the growth in spending started by Tony Blair’s commitment to reach average EU levels. NHS spending has grown from about £35bn in 1997 to a planned £103bn in 2009-10 - a little less than doubling in real terms. Staff have of course been the main direct beneficiaries in both pay and numbers - not surprising given healthcare is a “hands-on” industry. And services have undoubtedly improved, as the deluge of statistics, reports and performance ratings prove.

The big question will always be whether the spending gave good value for money. Efficiency and quality have been linked from the start. Delivering the NHS Plan made improving productivity a specific aim, to make the most of the extra funds and capacity building started by the NHS Plan. Payment by results was introduced specifically to increase activity to reduce waiting lists and was at first only to apply to elective care. In 2002 productivity was expected to increase by 2 per cent a year, 1 per cent cost and 1 per cent quality, matching the trend in the wider economy.

But productivity has at best flatlined, although whether the measures take enough account of quality improvements is an important point. Could more have been bought for the money? Almost certainly. But nobody knows how much more and there is no denying the growth in capacity and the brighter, newer buildings bought through the private finance initiative that go with it. We are about to find out what the service can achieve. I continue confidently to predict that productivity will increase, as it is already showing signs of doing in the acute sector.

Cutting bureaucracy is a long standing theme. The relevant chapter heading in The New NHS is “How the money will flow: from red tape to patient care”. It promised £1bn from ending bureaucracy. But, rather like painting the Forth Bridge, every four years or so the DH has sought cuts in management costs. The latest is the plan to take 30 per cent out. Apparently, the Forth Bridge is getting a new coating that will end the cycle. Perhaps the most recent steps will do that for management costs, but I doubt it.

Quality is the other major area. High Quality Care for All clearly set an agenda, building on national service frameworks (another innovation from The New NHS). But improving quality while becoming more efficient will be difficult. Health secretary Andy Burnham’s 2009 white paper From Good to Great set out a vision of how that might be achieved over the next five years and how the NHS might become more responsive to the needs of individual patients. His shadows Andrew Lansley and Norman Lamb have their own approaches. But “QIPP” is something the NHS is talking about, not doing yet.

High Quality Care for All sought to recapture the spirit of the NHS Plan. It followed a period in the mid-noughties symbolised by deficits, the rise of MRSA and continual debate over reform mechanisms. That debate continues (what exactly is the role of competition and choice?) although the basics of tight control over finance and infections have been reinforced.

But High Quality Care for All concentrated on the NHS, whereas a constant theme has been better cooperation between health and social care. This has a long history. It goes alongside GP commissioning, providing more care outside hospitals, especially for those with long term conditions, and reversing the steady growth in accident and emergency attendances and urgent admissions. Those of us with long memories can think of Stephen Dorrell’s A Service with Ambitions, which was associated with phrases such as “a primary care led NHS” and “care close to home”.

International outlook

Joint work is the long standing holy grail of health service policy. But if the real Berlin Wall was demolished in 1989 there are still at least some guard towers between the NHS and social services. A&E attendances and urgent admissions have kept on rising. And GP involvement has gone through fundholding to primary care groups to practice based commissioning, only for the primary care tsar to declare it in need of resuscitation.

It may be of some comfort for whoever is health secretary after the election to know all other health systems face similar challenges. We are increasingly learning from them, and they from us. NHS Direct, cross-charging for delayed discharges, payment by results and foundation trusts are all foreign imports. NICE judgements and national service frameworks are intellectual exports. But a striking feature of the decade has been a growing convergence of approaches internationally. If you look at last year’s Commonwealth Fund survey we have more of the building blocks to address these issues than many developed countries.