A year after the number of PCTs was slashed, the annual health check has found the reconfigured organisations to be the worst performers. So was the pain worth it, asks Alison Moore

Bill Clinton famously had a sign in his 1992 election campaign headquarters that read: 'It's the economy, stupid.'

Somewhere in Richmond House there must be a similar sign - 'It's the structure, stupid' - for structural change so often seems to have been the first response to the NHS's problems.

Former health secretary Patricia Hewitt's answer was to halve the number of primary care trusts. But just over a year on, has the change achieved its aims?

Chief among these was improving commissioning. With the Department of Health's vision of world class commissioning on the horizon, this may still be to come.

But the new PCTs were also meant to improve public and clinician engagement, manage their finances better, reduce management costs, and improve co-ordination with local government.

With the Healthcare Commission's annual health check reporting PCTs as the worst performers 'on the things that matter most', and the reconfigured ones coming out worst of all on quality of services, early wins are not yet in evidence. Reconfigured PCTs were meant to secure high-quality, safe services.

They are not doing too well on financial performance either, as the Audit Commission's Review of the NHS Financial Year 2006-07 made clear: 19 of the 27 organisations required to take 'urgent action' were primary care trusts.

The reconfiguration moved many areas towards coterminosity with county or unitary councils, although this led to wide variation in the size of the populations they cover - Hartlepool, with fewer than 100,000 people, has a tenth the population of Hampshire, for example.

For some PCTs, aligning boundaries with local government has been extremely successful: Marion Dinwoodie, chief executive of Medway PCT, which was already coterminous, says it allowed the PCT to drive through local area agreements and health and social care frameworks. The PCT is linking into the regeneration of the area to help achieve its aims.

Coterminosity has benefited public health through more joint appointments at senior levels, such as directors of public health, and gives PCTs a chance to influence some of the wider determinants of health inequality, although visible progress on this may take far longer than a year.

Some imaginative ideas are already coming forward: in Cumbria the countywide PCT has worked with the county council on proposals to co-locate health services and housing for the elderly.

But in other areas, councils were too big to be coterminous with PCTs. In Birmingham, GPs were concerned about the prospect of dealing with a single citywide PCT, says Birmingham East and North chief executive Sophia Christie. With three PCTs, chief executives can still remain in touch with practices and share the burden of sitting on joint committees.

Bigger PCTs risk being more distant from clinicians and communities. Former PCT chief executive and now NHS Alliance spokesman Rick Stern says: 'In the end we are in a business where relationships matter. The issue is how we maintain local relationships and how we stay close to GPs.'

In West Sussex, where five PCTs became one, deputy chief executive Sue Braysher says there was a tension between the need to save management costs and developing strong local primary care. The trust has recognised that the local structure needs more resources, she says.

'GPs have lost their single point of contact that they had for three or four years,' she says. 'We are aware that the routes into the PCT are too complex. People need to make one phone call and get to the right people immediately.'

In Cornwall, the PCT has worked hard to keep the local focus while retaining the strategic advantages of being one PCT. 'I want the best of both worlds,' says chief executive Ann James.

This has extended to not designating any of the PCT's buildings as 'headquarters' and encouraging staff to use tele- and video-conferencing.

Portsmouth City PCT ex-chair Zenna Atkins questions the 'bigger is better' approach, suggesting the real issue was not size but the lack of a 'failure regime' in the NHS.

The right atmosphere

Public engagement - which was also meant to improve under the new PCTs - has become more sophisticated. But with consultations often taking more than a year it is hard to see the effects of the reorganisation yet. Liverpool PCT's much-praised Big Debate - which started with basic principles of what people wanted from healthcare while examining the trade-offs - started before reconfiguration but only led to decisions this summer.

NHS North West chief executive Mike Farrar says the coming reorganisation probably created the right atmosphere for consultations such as this. 'It is leading to significant direction of resources in line with people's aspirations,' he says.

In some cases a change of PCT - and often a change of culture - has provided the impetus to go 'back to basics' on service planning. Cornwall PCT spent four months listening to staff, patients, clinicians and the public about what they wanted from health services and then developing a strategic framework. The PCT stages a 'roadshow' at a different location each month, including a health fair, an opportunity for the public to question the PCT, and a board meeting.

Liz Kendall, former special adviser to Patricia Hewitt, is sceptical about progress towards public and clinician engagement, where there are variations between NHS organisations. 'How do you reach out to groups of people who don't present to user services?' she asks. 'How do you ask people about services they don't know exist?' She also thinks the NHS will have to tackle the question of local accountability at some point.

Persuading local communities of the need for change to their local district general hospital has remained as hard as ever. However, bigger PCTs may have led to boards which are less tied to one local hospital and opened the way for difficult decisions to be made.

For many, the success or failure of reorganisation will hang on whether commissioning has been strengthened. Mike Farrar describes it as being on an 'upward trajectory' but the real take-off may be to come, especially with world class commissioning still in development. That is also the perspective from acute trusts.

United Lincolnshire Hospitals trust chief executive Gary Walker says his contracts are still based on schedules of activity rather than the more outcome-based measures or pathway protocols. But he says this lack of immediate change is misleading and PCTs have been spending the last year working out their plans to buy better - the evidence is likely to be seen in contracting for 2008-09 and beyond. The quality of commissioning teams has also improved, he says.

East and North Hertfordshire trust chief executive Nick Carver says dealing with one PCT rather than four is simpler. As the area is going through an acute services review, the trust has been working closely with the PCT, and consultants and GPs - as well as managers from both organisations - have been appearing together on public platforms to talk about the future of services. The quality of commissioning is improving and the review has focused attention on care pathways.

Upping the pace

The West Sussex philosophy is that commissioning is part of everyone's job and the PCT has looked at everywhere it is spending money, rather than just at what to spend additional funds on. Sue Braysher says the organisation is now big enough to look ahead: 'Some organisations did not have the capability and capacity to focus on anything but the current.'

Bigger PCTs are inevitably stronger players in negotiations with acute trusts - bigger budgets give more leverage, as several PCT chief executives point out.

Larger PCTs can become monopoly buyers, just as large acute trusts are monopoly suppliers. With each side dependent on the other, this can sometimes lead to greater co-operation and a shared vision.

Some PCTs have faced a financial imperative to commission better: in Birmingham East and North PCT, where money needed to be saved, the PCT had to 'get into some pretty sophisticated commissioning around referral management, demand management, coding and commissioning new styles of service', says chief executive Sophia Christie. 'We had to up the pace of change.'

Many PCTs feel they still lack skills and capabilities in commissioning, although these are being developed. The importance of information analysis also seems to be higher on the agenda than ever before - with the prospect that commissioning will be based on good evidence.

Many chief executives also admit that commissioning used to be just contracting. Quality and pathways are creeping in but that may be due more to a change of culture than of structure.

PCTs say they are reducing management costs, often by using economies of scale. The recent concentration on financial balance has made a difference - PCTs can no longer plan to end the year in debt. 'Probably for the first time we have chief executives and chairs who will deliver on the money, but I don't know that we have ones who understand commissioning,' says Zenna Atkins.

But in the short-term, the NHS has had to meet the costs of laying off staff. And there is the loss of momentum for a year and of skills and knowledge of those who have left which can have their own incalculable cost.

Shuffled out

Some of the strongest PCTs are those that have remained stable. Ms Atkins says Portsmouth was able to get on with improving services while other PCT managers were wondering whether they would keep their jobs. 'The solution is not about organisational structure. Only the NHS does this - it does not exist in the business world.'

Even PCTs that did not change geographically often had significant internal change. Rick Stern talks of the '18 months where it feels like it was lost time and dead space'.

He says in some cases it was as if the espoused values of the NHS were being ignored as people were hastily shuffled out. 'It felt like they disappeared in some Third World regime,' he says.

NHS Alliance chief officer Mike Sobanja says there has been a loss of organisational memory - and much effort put into reinventing wheels.

Ultimately the success of the reorganisation may be judged on how quickly PCTs have overcome this hiatus and started to reap the benefits through better joint working with councils and improved commissioning.

Does a change of structure lead to success? Many chief executives mentioned a change in culture and focus as being important rather than simply being bigger or fitting in with local authority boundaries.

Mr Sobanja says: 'Personality and culture are much more important than structure. Good people will make bad structures work and bad people will make good structures fail.'