Those who worry about the commercialisation of services for NHS patients often point to problems created by privatised utilities or the unholy mess that is the West’s banking sector.
But in both cases those problems have arisen in the light of deregulation or, at the very least, light touch regulation. It is clear from the plans being prepared by the Department of Health that regulation will play a much stronger role than competition in most areas.
A DH presentation on the “competition and procurement” regime features one slide entitled “Regulation and competition play crucial complementary roles”. It explains how “the appropriate level of regulation will vary in different circumstances”. The document highlights, for example, how there will be a “minimum level of regulation” concerning competition for “elective procedures in urban areas”, while “substantial additional regulation” will be required for areas of “natural monopoly”, such as “specialised stroke services”. But plastered across the middle of the slide is: “some regulation will always be necessary”. The very first word in the presentation is “safe”, as in “safe regulated social markets for NHS-funded services”.
There is little sign the government intends, in the next few years at least, to “let the market rip” as many feared – and a few hoped.
The appointment of ex-Barts chair Keith Palmer as a non-executive director at Monitor is another straw in the prevailing wind. Mr Palmer is a highly experienced economist, with a lifetime of experience in the commercialisation of state enterprises. His paper on the reconfiguration of hospital services for the King’s Fund carries strong warnings about letting competition issues alone decide how services should be structured.
In fact, it is another event at Monitor that points to the real difficulty posed by the government’s desire to introduce more competitive grist to the NHS mill. We reveal this week the struggles the organisation is undergoing to balance its role as steward of foundation trusts with its new responsibility as the sector regulator, particularly its task of addressing anti-competitive behaviour.
Any problems arising from increased competition – or indeed the lack of it – are much more likely to come from the complicated web of local decisions, national guidelines and regulatory structures that will govern who gets to carry out or bid for what services.
Here, there is a very real parallel with the banking meltdown in that financial institutions were involved in activity so complicated that very few, including themselves, could see the problems coming. It may also, as Royal College of GPs chair Clare Gerada points out, result in commissioners living in constant fear of challenge resulting from a misunderstanding of the regulations. She says this could mean they will err on the side of placing services out to competition. Others argue that for the same reason they will opt for the status quo.
The new, likely, emphasis on tendering work rather than making it available to any qualified provider is just the latest change in a constantly shifting debate. As, of course, is the increased emphasis placed on integration of health and social care, the latest and largest example of which emerged in Staffordshire this week.
Finally, there is also an issue of democratic legitimacy. Work is only now beginning on regulations that will govern decisions made by commissioners on the use of competition, the same is true of the “standing rules” on patient choice. The framework for regulating choice and competition will only become fully clear in the “early winter”, perhaps six months or more after the Health Bill has received Royal Assent. It is a point that will not be lost on peers as they debate the new legislation over coming weeks.