Published: 16/06/2005, Volume II5, No. 5960 Page 6

The health secretary has acknowledged 'a real risk' that patients who should be treated in the community would be 'sucked into hospital' because of the financial incentives under payment by results.

Patricia Hewitt said the concerns were discussed at the first meeting of the Cabinet's committee on NHS reform, chaired by the prime minister, which met for the first time last Thursday.

'There is a real risk and That is a risk that we are very alert to. We spent some time discussing it and I think because we are very alert to it we can design the system in a way so that it doesn't do that.' Ms Hewitt said the strengthening and expansion of practice-based commissioning was 'probably the best way of counteracting the risk of gaming in the system and the risk of hospitals sucking in patients who would be better treated in the community'. But she admitted the government still had a lot of work to do to finalise the design for payment by results, and to make sure people had 'confidence in the whole process'.

She added that the system needed to allow the government to 'change things quickly if unexpected problems arise'.

Ms Hewitt said it would be a 'few months yet' before the Department of Health had enough information from foundation trusts' experiences piloting PbR for emergency care to see if 'there is something in the early design. . . that we need to learn from'.

She stressed PbR was key to increasing public confidence in the value for money offered by the NHS, given that 'surveys show a high proportion of the public think a lot of money is being wasted'.