The right sort of competition in healthcare is a prescription for huge gains in quality and efficiency. But while this can be encouraged partly through attractive incentives, have we been too lenient in pursuing more punitive measures?

It’s that funny time of year - attendance at meetings is patchy because people are on holiday, often with their school-age children. Some organisations relentlessly pursue August meetings, while others have given up in frustration. Apples have no flavour and people who look as though they have been somewhere exotic ‘fess up to a spray tan and a “staycation”. I use the American neologism to prove I have not yet become so jaded as to abandon reading the newspaper - though as I have had only two five-day breaks in 11 months, you will have to forgive some cynicism in my choice of news content.

Meanwhile, this is a strange transitional time for the sexagenarian NHS, which finds itself muttering about how life really could begin at 60, given that 60 seems to be the new 40. The specialist media is full of references to Lord Darzi’s next stage review, but even the mainstream media - print and radio - are littered with references to performance, outcomes and incentives. The Sunday Times included the headline on 20 July: “Surgeons set for pay bonuses if their operations are successful”. The proposal, by Imperial, is only at the discussion stage but has already gained legs.

Staying on message

Simon Stevens rightly observes that the difference from Lord Darzi is that he is both medium and message. But the other transformation and opportunity is the renewed focus on quality and outcomes - on this occasion with an army of clinical champions. This alone surely has to foster greater clinical engagement than we have experienced to date.

Surely a focus on quality and outcomes cannot fail to engage frontline clinical staff. And this also plays to the Michael Porter (he of Harvard Business School fame) concept of positive-sum competition. Porter’s thesis is that competition in healthcare systems frequently sits at the wrong level, in relation to the wrong entities and often at the wrong time. He sees competition at the level of diseases or treatments as the engine of reform. The locus of competition then shifts from “who pays?” to “who provides the best value?”. Providers need to develop clear strategies to become distinctive; there should be no restriction on nchoice - although given his US focus, Porter describes co-payments and the need for people to take financial responsibility for their choices. Another key determinant is the need for high-quality information - about pricing, outcomes and patient experience.

Sparing the rod

As I gain in experience of dealing with clinicians, and the medical profession in particular, I realise that - like any other sophisticated workforce - they can understand both carrot and stick. Have they become unused to the latter in recent years?

Doing the best for patients - put simply, delivering a high-quality patient experience and the best outcomes feasible under the circumstances - will motivate the vast majority of doctors. A small, recalcitrant element will resist change in the mistaken belief that their way of doing things has been, and always will be, the best. Whether that is about cumbersome clinical pathways or antiquated clinical practice that has long been superseded, the opportunity for some commissioning stick (evidence based, of course) is important.

And while we wait for commissioning to mature into its “world class” status, there is that other powerful stick of patient choice. The rise of competition between services within and for the NHS brings with it a growing awareness by the public of their right to exercise that choice. Couple that with better data on outcomes and performance incentives - more carrot - and we could be on our way to a more dynamic system that lives up to Michael Porter’s prescription for healthcare, where competition at the right level can deliver huge gains in quality and efficiency.