'Strategic health authorities and GPs must represent the best interests of the citizen and patient... However, they face some pretty daunting challenges'

In some quarters, private sector involvement in 'buying' healthcare seems to be more worrying than private sector provision. However, effective use of the private sector in commissioning is critical to establishing a cost-efficient, patient-led and responsive NHS.

Effective commissioning could significantly enhance the NHS reform programme. Strategic health authorities and GPs must represent the best interests of the citizen and patient and have a duty to commission the best-quality care they can while ensuring affordability and value for money. However, they face some pretty daunting challenges.

Information to make effective commissioning decisions is patchy to say the least. In addition, PCTs in particular are under pressure to develop the ability to respond to the increasingly complex commercial provider market. There are many drivers of change: financial imbalances, the move from block grants to payment by results and binding contracts, foundation trusts, the growing use of alternative provider medical service contracts, and competition from independent treatment centres, to name a few.

Commissioners must rapidly gain capabilities to address these issues within the limited resources available.

There are many aspects of this new environment which are similar to the one faced by private sector commissioners, but there are substantial differences as well. UK insurers commission around£3bn worth of healthcare a year through contracts with private sector providers and NHS trusts (the second largest provider of private healthcare in the UK). Commercial relationships extend to over 30,000 consultants and other health professionals, most of whom also work in the NHS.

These arrangements have to encompass both financial and quality measures and have to encourage innovation and competition. UK insurers have had to develop the systems and processes which are relevant to the NHS.

US-based health maintenance organisations work in a similar context, as do commissioners in many continental and Asian countries where the private sector is more integrated into end-to-end health delivery. Of course there are differences between the NHS, UK insurers, and foreign commissioners such as American HMOs or mainland European health funds. UK insurance is primarily focused on elective work. The US employer-funded system is very different from the UK tax-based system, and complex risk stratification is less effective when those at most need do not necessarily wish or have to engage with the system.

However, in many continental countries like France and Spain (where BUPA also operates) the private sector does end-to-end commissioning of services within a tax funded system so the skills are transferrable. There is also the contentious issue of 'ethical profit', although the argument that private companies are less motivated to deliver quality healthcare than the public sector is seriously flawed.

The private sector has no 'magic bullet' to deliver effective commissioning overnight, nor is it an alternative to the role of NHS commissioners who must ultimately make choices on behalf of patients and citizens. However, capable private companies can supplement the capabilities of NHS commissioners as they seek to exert their influence in an increasingly commercially savvy health system.

Dr Natalie-Jane Macdonald is director of commissioning services, BUPA.