Responses to Andrew Lansley’s speech last week, in which he suggested age is the “principal determinant of health need” and that clinical commissioning group funds should flow accordingly, have been predictable. Predictable and largely inconsequential.
Politicians love arguing about funding formulae. When it comes to health need, most conservative politicians see age as the mainspring, although rurality also has its advocates. Their left-leaning adversaries usually view deprivation as more important. Then you get the whispers from the right that health funding shouldn’t be used for redistributing wealth, and those who pay more taxes are entitled to expect better care.
Without growth, investing more resource in Eastbourne and Torquay means actively snatching it from Merseyside and Tyneside. Politically that’s difficult, even for the coalition. So chances are the advisory committee will make its recommendations, the formula will change, but little will happen as a consequence.
The bigger resource allocation question is this: how are the savings from the Nicholson challenge reinvested? It isn’t just about saving £20bn; the whole point is to generate enough efficiency savings to meet unavoidable costs. So how does the money flow back into the NHS?
The unavoidable costs in question are threefold. Two are demographic: the population of England is ageing, and it’s also growing. These two factors imply greater demand for healthcare. The third pressure is scientific advance: new offerings from the pharmaceutical and medical technology industries. Taken together, these broadly account for the 4 per cent annual quality, innovation, productivity and prevention gain being sought from the NHS.
The tools for extracting the cash are familiar enough. What remains opaque is how the money is channelled back to where it is needed.
Some should inevitably bolster services for older people, and we’ve known about that particular demographic pressure for decades. The secretary of state will be pleased. But the amount and spread of population growth, and its implied investment in primary care, remains more vague. Meanwhile, scientific innovation presumably calls for targeted tariff increases, or in some cases radical tariff redesign. But where, please, is the process for reinvestment?