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Thomas Cawston is head of health policy at Policy Exchange

Back in October The Times ran a front page story citing an unnamed Cabinet source that claimed the reorganisation of the NHS was the Government’s biggest mistake. It is undeniable that Andrew Lansley’s reforms created a headache for the Coalition at the time. It has come as no surprise that Jeremy Hunt has barely mentioned his predecessor’s reforms and has been widely praised for moving the debate forwards and pitching himself as the patients’ champion.

Of course the spectre of a reorganisation that was so “big that they can be seen from space” has not gone away. Today the Labour MP Clive Efford is bringing forward a private members Bill to reverse some of the Health and Care Act’s supposed faults. No surprise his big target is the “privatisation” of the NHS that the Health and Care Act apparently unleashed. Yet despite this obsession among various campaigners the Lansley Bill was no radical blueprint for privatisation.  The role of the “market” in healthcare today needs to be put in context.

Among the measures that are firmly in Efford’s crosshairs is the role of Monitor, the sector regulator, in promoting competition, and the now infamous “75 regulations”, that supposedly enforce competitive tendering. While these provisions are regularly decried, in many ways they mirror exiting requirements when it comes to spending public money (procurement law, NHS Constitution and the like).

The Health and Care Act created a dedicated judicator, in the shape of Monitor, that would assess matters pertaining to choice and competition, through the perspective and safeguard of patient interests. Repealing these provisions of the Act would simply mean that complaints would be addressed by the Competition and Markets Authority, or in the courts. More costly for sure, and potentially less sensitive to the complexities and subtleties of healthcare delivery.

Whatever the intricacies in the law the fact of the matter is that the role of the private sector remains infinitely small. For all the talk of “wholesale privatisation” only six pence in every pound spent by the NHS goes to the private sector. While recent investigations have highlighted that the private sector are winning a majority of tenders since 2012, the number of tenders remains small, 195 in total.

Typically NHS organisations are tendering out contracts to improve services and deliver value for money. Many public-private partnerships are to provide more joined up community services, pharmacy or home care, exactly the sort of transformation that was described by NHS England in the Five Year Forward View. In many ways the gradual increase in the private sector is not so much a consequence of legislation but of the urgent need for the NHS to change the way it does its business in the context of tighter budgets and rising demand. The Health and Care Act created a better infrastructure for the NHS to use the private sector and clear rules to ensure commissioners were acting in patients’ best interests.

Moreover the NHS has been making use of the private sector to bring down waiting lists for years. For example the last Government’s introduced Independent Sector Treatment Centres for routine operations. Patient choice was enshrined in the NHS Constitution in 2009 and is valued among patients, particularly among older and less affluent parts of society.

Another “red herring” that continues to hit the front pages is the decision to lift the cap on the amount of income NHS hospitals can earn from private providers, rising to 49 per cent. To put this in context, last year non-NHS income made up 1.6 per cent of all income for NHS hospitals. A tiny increase from the previous year. However for some specialist hospitals it is a vital income stream that allows investment in costly new innovations that benefit all patients. As a spokesperson from one hospital recently said “Growth in private income has not been generated at the expense of denying, delaying or reducing NHS service, but in order to support it.”

Where the Act did create problems was in its “redisorganiastion” of the NHS. At the time many cautioned that desire to create new Clinical Commissioning Groups resembled yet another attempt to reshuffle the deck chairs on the Titanic. What was once a simple and positive idea to put family doctors closer to commissioning decisions produced a set of reforms of bewildering complexity that have yet to lead to the improvements that were hoped for. Despite the myths that surround the Act, it rationalised as opposed to revolutionised the role of the market. While some Ministers would like to be the whole lot back into the box from whence it came, the Government should not regret putting patients in charge or giving greater freedoms for hospitals and providers to innovate.

 

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