Oliver Letwin has hit the headlines again for his “no limits” approach to privatisation of the NHS.
This isn’t exactly a huge difference from what Labour are currently doing, with “Private Treatment Centres” being given growing volumes of work, PPP putting the NHS in debt to private investor capital, and huge volumes of privatisation of non-frontline services such as finance, logistics, catering, cleaning…
We all know the problems that privatised cleaning services have caused. There are frequent, and sadly true, horror stories of dirty wards and horrific MRSA and related superbug infection rates – just this week a hospital in Patricia Hewitt’s own constituency has been hit, with tragic results for some of the unlucky patients.
Equally awareness is growing of the spiraling debts that PPP/PFI deals have caused. As more and more hospitals go to the wall there is a growing concern that the NHS has been forced into a horrendous position – NHS managers have been forced to borrow amounts that they cannot be repaid merely to meet basic safety requirements as old premises were literally collapsing around patients.
Yet scarily, Private Treatment is managing to carry the façade of social acceptability by hiding behind the banner of “Choice”. As good Liberals we should all be backing the concept of choice in public services – patients should be allowed to choose appropriate treatments that are accessible and convenient to them. Fine – I agree with all that, but what price choice?
You see the problem is that NHS funding follows the patient, which seems fine and dandy until you remember that Taxpayers money is being funneled into shareholders pockets, and far, far worse than that the very future of the NHS is being jeopardised by this.
“Your local hospital is now only paid for the patients it treats”
Your local hospital is now only paid for the patients it treats, so if patients stop going there they don’t have the cash to pay the bills. But they still need to pay staff, the private cleaners, the PFI bills, the electricity, the rates….. Sadly it costs the same to heat ½ empty wards as full ones. You can adjust your staff costs by sacking half your nursing staff and bringing them back on agency rates at twice what you should be paying them when you are busy, but that is hardly prudent use of public funds.
You cant afford to shut down your big theatres, as they are still needed for your Accident and Emergency Service – can you imagine the scene:
Ambulanceman1: Hello Sister, we have a motorcyclist here who was in a serious road traffic incident – he urgently needs surgery for compound fractures of both thighs
A&E Sister: Sorry mate, due to everyone going off to BUPA to get their artificial hip done the Trauma and Orthopaedic operating theatres are shut as we can’t afford to keep them open any more…
But this is becoming a sad truth. The overheads for running a decent Trauma and Orthopaedics service are huge. The specialist skills need from medical staff all types are varied and amongst the most challenging of clinical skills, and under payment by results you hospitals will not be able to maintain services that are making a loss. But what else are they going to do BUT make a loss when the bread and butter “elective” operations are being leeched off to private hospitals, with patients often choosing to go private for reasons that have nothing to do with clinical care but rather satellite TV and flowers in their room.
I am Liberal and pro choice, in the usual run of things, but the NHS is going to collapse completely fairly soon if something is not done. I am not sure we can afford to choose anymore.
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13 Comments
The most recent PCT tender OJEC submission has the potential of privatising all PCT spend. (July 2006)
Scary, isnt it?
The NHS has many faults but the total collapse of it is a frightening thought.
“We all know the problems that privatised cleaning services have caused. There are frequent, and sadly true, horror stories of dirty wards and horrific MRSA and related superbug infection rates – just this week a hospital in Patricia Hewitt’s own constituency has been hit, with tragic results for some of the unlucky patients.”
This implies that privatised cleaning services are necessarilly bad. That is not the case. What has happened is that the tender was poorly constructed and probably awarded on the basis of price rather than performance standards. There is no reason why a privatised cleaning service could not deliver as good a performance as a public one.
I agree with you that the PFI initiatives have also been badly constructed, with too little risk-transfer to the private sector.
“with patients often choosing to go private for reasons that have nothing to do with clinical care but rather satellite TV and flowers in their room.”
You say this as if its something bad. Up above you’ve already stated the risks associated with MRSA; is it surprising people might look at alternatives? Also, have you ever spent a night in an NHS ward? Might you want some privacy, perhaps?
We live in a totally different world in people’s expectations than when the NHS was founded. We have to realise that – and work with it, not condemn it.
I’m always in for some Tory/Labour bashing, but when it’s internal discussion let’s not fall victim to our own propaganda here.
If any of you were asked “What is the limit to private sector involvement in the NHS?” pretty much everyone apart from public health experts would answer “I haven’t got one” – Letwin did the same. So by all means let’s go for the throat in focuses, etc, but let’s not confuse it with actually being more than a political faux-pas.
The Tory policy on the NHS actually seems to be identical to the Labour policy – and highly pragmatic at that. The reforms have almost universal acclaim from experts, consultants and academic researchers – the question isn’t “At what price choice?” as it’s choice which is allowing the transition: The Labour govt isn’t in favour of choice because it wants people to choose where they go to hospital – they’re in favour of choice because they see it as a powerful market mechanism to raise standards.
As Lib Dems we could and should have a lot to offer to the NHS reform discussion, but as long as we come up with consistently uninformed and populist requests to go back to the “good old days” of the NHS from before Labour came into power, then we’ll continue to lack that credibility on the issue.
We could do worse than stealing another Blair belief – we are at our best when we are reforming.
Hospitals only paid for the patients they treat? Sounds resonable enough to me. What Grace Goodlad is missing here is that hospitals are capable of responding to this by improving their services.
Consider a scenario: a hospital suffers from poor cleanliness and MRSA becomes prevalent – measurably above the national average. Of course people are going to choose to go elsewhere, and it’s absolutely right that they should do so. End result: fewer people with MRSA. Without choice, more people would have MRSA.
Let’s take step two in this process now. With choice, the hospital management is going to start feeling the consequences where it hurts – on the balance sheets. They will have to tackle the MRSA problem, or lose more patients and money. Without choice, they’d continue receiving more funding and would have reduced incentives to tackle the problem.
As Lib Dems, which scenario are we in favour of?
If Government spent money into circulation, creating it as required for direct investment in new hospitals (or any public infrastructure project) the swindle of PFI would be dead in the water.
If the wealth that all public infrastructure adds to land values were collected via LVT, it could be recycled for the public purse, paying for additional health professionals and the drugs patients need.
If tax shifted in this direction and off the labour intensive work of the NHS (and indeed off all work) the nonsense of government taxing its own public sevices would end, with huge administrative savings.
If these savings were added to the more efficient and equitable yield of an LVT economy, together with reduced national overheads due to debt free money, a basic income could be paid to all citizens in lieu of tax allowances, tax credits and the vast myriad of social security benefits (some big admin savings there too!) – carers would get a wage, poverty would reduce and the burden on the NHS would fall.
A virtuous circle I believe. Simple really.
The whole structure of the NHS seems to be designed to not let this work, its a leviathan.
Some services are arguably not suitable for competition, acute emergency care being the obvious case, you don’t want to have to choose where you’re taken, you want to go to the closest A&E.
There’s room for choice in walk-in A&E since you’re by definition not in need of immediate treatment.
So perhaps accute A&E + paramedics should be funded out of general taxation and free at the point of use.
Then a compulsory (government backed for those who cannot afford it) tax free savings account for medical care could be held by each individual for the majority of their medical care, with a crisis insurance policy provided for extreme or long term health needs.
This gives the individual control over most of their healthcare, without disenfranchising the poorest.
The difficulty with health systems is providing everyone with a good standard of care, ensuring essential services are available and giving the individual (rather than NICE or insurance companies).
The problem with payment by results is that patient costs are calculated on a single episode basis. Therefore if less patients are treated, not enough income is gathered to pay overheads, like cleaning ,power, maintenance, the rest of that consultant’s shift when he is standing around without anyone to treat…
Tabman – you are right that there is no reason in theory why a privatised claening service couldn’t do an excellent job, but they havent. Privatised cleaning services have been as bad, if not worse than privatised rail. Many health professionals such as nurses are really angry about this as because of the external contractor relationship they do not have the power to direct stff to where they are actually needed.
Rob K – you say that it would encourage NHS hospitals to improve. But how would you do the managers job of improving cleanliness (a matter you would already be tearing your hair out over), dealing with an MRSA outbreak (huge costs in terms of extended patient stays, antibiotics, contagion units….), but less and less money to pay for all this. Also, MRSA is more prevalent amongst the elderly, frail and seriously ill, often the people in society who suffer most from deprivation in society, who at present don’t get treated in BUPA etc. The risk profile of infection may well change as patients move….
Um yes, I have stayed in NHS hospitals – to be honest knowing there is a full backup service on site is more important to me than flowers in my room.
Grace: “Tabman – you are right that there is no reason in theory why a privatised claening service couldn’t do an excellent job, but they havent. Privatised cleaning services have been as bad, if not worse than privatised rail. Many health professionals such as nurses are really angry about this as because of the external contractor relationship they do not have the power to direct staff to where they are actually needed.”
I stand by my point that this is because of the way the relationship has been framed, than because the services have been contracted out. Too often the Public Sector has been saddled with poorly-drafted contracts and as a result the private sector has cleaned up (sorry for the poor pun!).
Grace Goodlad wrote:
Well, first off there would be fewer operations to carry out, which would reduce costs. Secondly, no organisation really finances itself out of current revenues in the way you’re suggesting. Hospitals are large organisations which should have finances to fall back on, or the ability to borrow money to fund improvements (which should pay for themselves as patient numbers increase).
The most important point, of course, is the tremendous emphasis such incentives place on making sure the problem doesn’t happen in the first place. It’s no good a hospital getting an MRSA problem then turning around to the taxpayer and saying ‘we managed things really badly, now you’re all going to have to pay more to clean up our mess’, not least because that would deny money to other, well-run hospitals which don’t have such problems.
Rob – sorry but you are totally wrong.
By primary legislation non-Foundation Trusts are allowed no investments or savings. Hospitals are not allowed ANY reserves to fall back on, under the guise that all government funds should be invested in patient care. That’s PFI/PPP has been so popular – the NHS is NOT ALLOWED TO SAVE. There was a period in time when the NHS was allowed to place small amounmts in the money markets for short term investment of cash surplus but that has now been forbidden too.
Equally, direct costs are reduced in times of reduced activities, ie if you don’t do a hip replacement you wont need to buy a joint, blood or antibitics, but you will still pay PFI/PPP, salaries, rates, heating, cleaning contactors, medical negligence insurance…. Costs just dont disappear if they are inconvenient.
A bit like if you lose your job you don’t have your travel to work to pay for, but you do still have to pay for food, rent etc.
Equally MRSA outbreaks are not a direct result of good or bad management, but they are a clear indication. The MRSA bug exists in most hospitals and a number of factors determine if there is a full grwon out break – one factor that is a strong (but not sole) determinant in this is general hospital cleanliness. If you have heavy overcrowding of ill or weak people that is equally as hazardous. Some of our best hospitals in terms of teaching and clinical outcomes have had MRSA outbeaks.
Clearly they should be then. That hospitals have to exist with their finances controlled by the whim of the health secretary or an unelected quango is part of the problem and should be addressed.
On costs remaining when fewer operations are performed… this is true, but what would you do instead? Force people to go to a hospital because the hospital needs the money more than the patient needs good treatment?
Sorry, but MRSA is an aspect of management. It’s an infection against which steps can be taken. If they weren’t taken, then someone is to blame for that and consequences must be felt. That the hospital performs well in other areas is no consolation to the person with MRSA.
At last the nub of the debate – compulsion to attend a certain hospital?
Hmm, as I said in the original article choice is good, but what if by allowing choice we ultimately reduce it through hospitals becoming non-viable?
As for MRSA, it is a horrible infection, indeed elderly friends and relatives have dies of “hospital acquired infection” familiar words I am sure to some of you out there. Sadly there is no foolproof way of preventing MRSA infection in terms of management policy and procedure. The biggest problem is overstretched clinicians and staff. Hence I am of the opinion that as treatment of more and more vulnerable patients transfers to Private Centres the infection problem will spread to them.
MRSA infects some of the cleanest hospitals – the challenge is containing it and exterminating it quickly.
Higher staff to patient ratios are needed. More modern facilities and equipment would make a huge difference too. But these would divert funds from the oh so important target monitoring regime….. ..cant have that…..