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National Health Service History
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National Health Service History |
1998-2007 Labour's Decade
Policies, organisation, finance and quality
Quick links to the sections of the chapter
| Policy (major policy developments) | |
| Organisational change (restructuring) | |
| Finance (changes in finance and financial problems) | |
| Quality, performance and and governance | |
| Ministers/Secretaries of State for Health 1945-2008 |
| Frank Dobson 1997 - October 1999 | Hyperlinks below go to the documents
| Text link |  |
| New NHS | |||
| Alan Milburn October 1999 - June 2003 |
| NHS Plan |  |
| Shifting | |||
| Delivering the NHS Plan | |||
| Wanless | |||
| John Reid - June 2003- May 2005 | Patient Choice |  | |
| Payment by Results | |||
| A patient led NHS |
A
policy overview | For overseas readers who may not know much about NHS organisation. The organisation of the NHS is unlike that of most other western health systems, as the ultimate responsibility lies with government and the responsible minister (the Secretary of State for Health). From 1948 until 1974 the organisational structure was unchanged. Since then there has been a series of modifications every few years under both Labour and Conservative governments. Generally management systems have been hierarchical with the Department of Health at the apex, and been based upon the idea of one district hospital for each area. Hospital medicine has usually been separate from the organisation of primary care, and remains so. During the successive reorganizations senior managers have often retired - or been culled - those remaining or promoted feeling insecure, and of low morale. At the beginning of the 1990s the Conservatives introduced market features to the NHS, separating providers from purchasers and introducing an element of competition. Labour has reversed many of these changes, moved the system to something far more like managed health care, but around 2002 began to re-introduce ideas such as patient choice. |
Labour came to power in 1997. Each Secretary of State imposed (with the support of Downing Street, Tony Blair or Gordon Brown) his or her own approach so there were U-turns, for example on private health care. In summary
Frank Dobson (1997-1999) "Third way" collaboration. The internal market was brought to an end, with the elimination of fundholding and the substitution of 'commissioning' for 'contracting'. Labour's (initial) 10 year agenda was set out in The New NHS - Modern, Dependable, and during his watch NICE, a health inspectorate and national service frameworks were established.
Alan Milburn (1999-2003). Milburn arrived "as the wheels were coming off". Labour had assumed that if it reversed Tory reforms and smothered hospitals with affection, all would be fine. It now discovered that many Conservative reforms had merit. Alan Milburn provided a new and sometimes disruptive dynamism and a desire for massive change across a broad front, epitomised by his NHS Plan. There was central command and control and later an attempt at devolution but the small increases in funding were replaced by major additions projected over many years ahead and the NHS Plan. Milburn recognised that the NHS was under funded and obtained more money to expand of staff training and recruitment, an increase of 250,000 over the next 6 years. The start of a major building programme of hospitals under the Private Finance Initiative. Radical changes in organisation and funding took place. The idea of Foundation Hospitals was born. Labour sought partnership with private health care to create new capacity and to provide a challenge to complacency in the NHS. It looked to the experience of other countries such as the USA. Simon Stevens, the health advisor to the prime minister from 2001-2004 and the intellectual force behind many of Labour's reforms, wrote that the attempt to increase capacity, improve quality, and increase responsiveness while avoiding cost inflation was based on three parallel strategies.
supporting providers by increasing their number, modernizing infrastructure and supporting learning and the improvement of the system. (Capacity would be increased through staff recruitment, public-private partnership projects and new providers.
improving efficiency and reducing variation in performance by setting standards (National Service Frameworks, inspection, regulation, publishing performance information and direct intervention when necessary)
using market incentives for change and local accountability (e.g. patient choice, star ratings, reforming financial flows, and commissioning)
An alternative analysis said there would be
Speaking to the New Health Network, Tony Blair, the Prime Minister, in April 2006, later provided an insight into government thinking.
"What is true, however, is that it is only within the last two to three years that incremental change has given way to what amounts to a revolution in the way the NHS works. The NHS plan we published in the year 2000 – a 10-year plan it is worth reminding ourselves – set a new direction. We would first build up capacity and introduce new pay and conditions for staff and set strong central targets for improvement. However, the idea was then, over time, to move to a radically different type of service, abandoning the old monolithic NHS and replacing it with one devolved and decentralised with far greater power in the hands of the patient. The idea was and is to make reform self-sustaining; so that instead of relying on the necessarily crude and blunt instruments of centralised performance management and targets, there is fundamental structural change with incentives for the system and those that work within it, to respond to changing patient demand. "
John Reid (2003-2005) Deeply committed to Bevan's vision of a national health service he eased the rapid pace set by Alan Milburn. He focussed more narrowly on a few key things that might be delivered, e.g. admission waiting times and a four hour target of waiting time in A and E. At last there were improvements in waiting lists and staffing. Foundation Hospitals were a divisive issue but Reid continued to develop them. GPs and consultants fought against new contracts and then accepted them gaining far more money than the Department had predicted. He established a review of the many "arm's length bodies" and continued the 'modernisation' policies of his predecessor and placed increasing emphasis on patient choice. The new market of financial flows (payment by results) came into effect and there was increasing emphasis on chronic diseases and long term care.
Patricia Hewitt (2005-7) continued these policies with progressive introduction of private sector services, within the framework of a national service with its traditional values (see speech of 19 September 2006. A systemic change was now under way, moving to a more market based approach. The first major initiative of her own was the publication of a white paper in January 2006 on a shift of care from hospitals to the community services. By the 2006 Annual Conference of the BMA doctors made clear their opposition to a whole range of policies, patient choice, payment by results and practice based commissioning.
Alan Johnson, (2007) a former union general secretary appointed by Gordon Brown, took a fresh look at things. In supporting roles were a high-profile surgeon Professor Lord Darzi and a former nurse Ann Keen. Within a few days yet another review of the NHS began to explore "the causes of dissatisfaction among staff and patients". In January 2008 Gordon Brown delivered a speech outlining his view of the future of the NHS and the Review High quality care for all was published in June 2008. Johnson was particularly committed to the reduction of health inequalities and published a review of the progress and next steps in reducing them.
The New NHS - Modern, Dependable
When Labour came to power in 1997 Frank Dobson (and Alan Milburn his minister) found to their dismay that in opposition the party had developed no health service policy worthy of the name that was ready for implementation. They were starting from scratch. In that December Labour issued the The new NHS - Modern, Dependable, which set out their initial vision for change to NHS structure, conceding that some of the features of the Conservatives' internal market were worth keeping. Labour wished 'to rebuild public confidence in the NHS.' In fact they built on Conservative initiatives while denouncing them. The Government wanted to get things done fast and without necessarily relying on local management bodies. Watch-dogs, systems of audit, targets, and quantified, external and retrospective methods of control proliferated, as did "zones", initiatives and 'czars' with a responsibility for improving specific service
.There were three main themes of The new NHS
better communication within the service
an accent upon quality with new national supervisory bodies
a revision of the NHS organizational structure
None was revolutionary, all building upon trends already current. GP out-of-hours services had increasingly used nurses to assess emergency calls and the new nurse-led help line and NHS Direct was a dramatic development of this, paralleling the call centres developed in the private sector. Electronic communication had been developing for twenty years, and hospitals and GPs were already being progressively connected to the NHSnet.
Second, the existing quality initiatives were disparate and it made sense to try to pull them together. Labour established a National Institute for Clinical Excellence (NICE) to look at what should be done, and a Commission for Health Improvement (later the Healthcare Commission) to see what was in fact happening.
Third, the harder edges of the internal market were softened. Fundholding was to go, co-operation replacing more extreme forms of competition. ‘Partnership’ and ‘integration’ would replace the internal market . The jargon changed to that of New Labour; 'seamless services’ became ‘joined-up thinking’. National guidance stressed the interdependence of health and social care, and joint programmes. It was a return to the attempts by Barbara Castle and David Owen in 1974 to integrate health and social services planning. The NHS Act (1998) gave legislative authority for these changes and also the basis of professional self regulation of the General Medical Council. See BMJ 1999; 318: 317
Main features: The new NHS - Modern, Dependable.
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The run-up to the NHS Plan
By autumn 1999 it was clear that the NHS needed a lot more money urgently. A Mori poll showed that public satisfaction with the NHS, normally buoyant, fell substantially between 1998 and 2000 from 72% to 58%. Alan Milburn, now Secretary of State, reversed Frank Dobson's policy and encouraged cooperation with the private sector. He insisted that the economy was stable and growing and over ten years more resources would turn the NHS around. Tony Blair, worried by the continuing problems of the NHS, was interviewed by Sir David Frost on16 January 2000. In what was described as the most expensive breakfast in British history, the PM announced that spending on the health service in the UK would rise, over 5 years, to the European average. This public commitment had neither been costed by the Department of Health nor cleared with the Chancellor of the Exchequer. Over the next few hours that Sunday the Department's Chief Economist tried to work out with a calculator at home just what the cost would be. In the March 2000 budget extra money was found for the NHS on condition that the service and the professions ‘modernised’ themselves. Burdens on GPs might be reduced by NHS Direct and walk-in clinics; GPs, dentists, opticians, pharmacists and physiotherapists might group to take on more hospital work and old people might move out of big hospitals to convalesce in smaller ones freeing the main hospitals for acute care.
The extra money was generous. In May 2000 the government accepting that the NHS was again in crisis, announced a new plan, issued millions of questionnaires to the public and established six service reviews. Richard Branson of Virgin Airways was called in to advise on how to make NHS hospitals more consumer friendly. The result was a damning report that concluded that the NHS was being undermined by poor management and abysmal patient care. Labour dumped on chief executives a flood of central initiatives, requests for returns, demands for reassurance, and circulars. Centralization was in the ascendant. Yet the NHS could not be allowed total freedom. Cost and quality varied widely. Performance indicators had long showed that unit costs varied massively even for straightforward procedures such as appendicectomy (£470 - £2,100 per case). Why?
A seminal analysis had been published the previous year by Professor Alain Enthoven, whose ideas had earlier assisted thinking about the NHS in the mid-eighties. Enthoven published an analysis of the results of the 1991 reforms (In pursuit of an improving National Health Service: 1999 Rock Carling Fellowship. London: Nuffield Trust, 1999, see also BMJ). He saw advantages in the competition and innovation that had been introduced, and thought there had been a slight rise in productivity although there had been higher ‘transaction costs’. Fundholding tilted the balance of power from secondary to primary care, and in some trusts improvements had resulted from increased locally responsibility for performance. However he thought that the information about costs and quality was often not available, and incentives were sometimes perverse, with patients following the money allocated contractually, instead of money following patients to the hospital where they wished, or needed, to be treated. He argued for far greater attention to continuous quality improvement in the NHS. Enthoven (1999) queried whether Labour could make the NHS more responsive to the public, without introducing consumer choice, competition and substantially more money. Enthoven thought more money, fundamental reform and examination of performance variation was required. He cautioned against ‘quick fixes’ and Labour’s tendency to centralize management and policy making. He argued that consumer choice - to which the Conservatives had been moving - was essential.
Labour's second set of proposals for the NHS were issued in July 2000 - the NHS Plan. The plan set out to achieve four things
a diagnosis of the problems - honest about under funding
an identification of priorities - increasing capacity, improving responsiveness and dealing with major killing diseases
mechanisms to achieve change
and a broad coalition of interested parties
The Conservative reforms of ten years previously had stressed organisational change and incentives. In contrast Labour consulted the public and the professions that became deeply and often enthusiastically involved. The doctors said that any Plan had to be long-term, if only because of the time it took to train staff. They could understand the political need for short-term fixes but this should not detract from the longer view. The BMA liked government's acceptance that the NHS was under funded and there were too few doctors and nurses. Of more than 100 proposals, only one was unacceptable to the BMA in principle (debarring young consultants from private practice) and only a handful were questioned, e.g. that the staffing problems of the NHS might be solved at the expense of the Third World.
The public wanted quicker access to a GP, an end to "trolley waits" in A and E, booking systems for appointments and treatment, shorter waits for inpatient surgery and better food in cleaner wards. The Times believed that it was a coherent strategy, focusing on enhancing the numbers and function of nurses, addressing the role played by consultants, and increasing the number of beds that had fallen remorselessly for two decades. There were details and targets aplenty. Initiatives varied from "bringing back matron", to the improvement of hospital food by consulting celebrity chefs. There would be guaranteed access to an Accident Department consultation within four hours, and a telephone and TV beside every hospital bed. Patients would not have to wait more than three months to see a specialist, or more than a further six to have an operation. Central pressure was exerted upon local management to meet waiting-time targets. In spite of initial cynicism, patient waiting times declined, partly the result of trusts buying extra capacity, for example by paying their consultants a premium rate to handle additional cases in the evenings or weekends.
Main features of the NHS Plan
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T
he Plan's aspirations were not costed and in the event the same money was spent on several different things storing up a future crisis. There was an assumption that there would be cash enough, or at the least if government was rough enough with the NHS and its management, aspirations would be somehow be delivered. The books did not balance because of the cumulative effects ofpay awards above inflation and poorly negotiated contracts
reducing the hours worked by junior doctors
the recommendations of NICE
the costs of National Service Frameworks for mental illness, cancer and heart disease
the costs of establishing Primary Care Trusts
Few Trusts had any chance of achieving all the targets and put finance at the top of their priorities. Chief Executives might be warned that it would be 'personally dangerous' to make a fuss. The biggest threat to Plan's objectives was shortage of skilled staff. In some hospitals the staffing level on wards was at crisis point and patients were not even being washed. Some thought that the NHS Plan raised expectations to an unsustainable level. Alan Maynard, professor of health economics at York, said it contained lots of words and good intent, but that the pearls among the manure had to be teased out. Even with enhanced budgets the new agenda could not be afforded. The previous Secretary of State Frank Dobson feared that some failing hospitals might come to be managed by private-sector organisations. David Hunter wrote that the evidence from successive reorganizations since 1974 was that altering the structure and configuration of health agencies invariably resulted in
unrealistic expectations : changing the culture - as opposed to the structure - of an organisation required stability.
costs higher than forecast, financially and in human terms, with a loss of irreplaceable skills and expertise
failure to save money
Managers were unhappy not because of the government's goals, or its diagnosis of the problems of the NHS, but because of the way policy was implemented, the obsession with organisational restructuring, micro-management, short term demands, 'must do' edicts, and a name and shame culture.
Alan Milburn drove the high profile and politically important Plan. In January 2002 he set out his vision of a health service (Redefining the NHS). Who provided the service became less important than the service provided. Within a framework of common standards, subject to common independent inspection, power would be devolved to allow local freedom to innovate and improve services. Hospitals earning more autonomy would be subject to less monitoring and inspection, have easier access to capital, and be able to establish joint venture companies.
Legislation
Key Points of Legislation
Source :HSJ 15 November 2001 Enacted as National Health Service Reform and Health Care Professions Act 2002. |
The changes in the NHS Plan and Shifting the balance of Power (August 2001) required legislation because of the alterations to the nature and duties of health authorities. Patient advisory and liaison services (PALS) would be established to provide assistance to patients, resolving complaints where possible but helping patients when a formal complaint seemed appropriate. In September 2001 the government established a Commission for Patient and Public Involvement in Health, closed in 2008.) The impetus owed much to Professor Kennedy who had chaired the Bristol report. The Commission had the responsibility for establishing, funding, staffing and managing a network to take over the function of the Community Health Councils. It was a complex structure and in 2004, under the review of Arms Length Bodies, the Commission's future was questioned. It was closed in March 2008 to be replaced by (LINks) coterminous with local authorities. 150 local involvement networks would work with NHS bodies to involve and consult local communities about changes to services. The membership of these would include youth councils, individuals, foundation trust governors, tenants’ groups and a wide range of other interests.
Delivering the NHS Plan (April 2002)
After the 2002 budget had increased the financial expectations, Alan Milburn, published Delivering the NHS Plan - next steps on investment, next steps on reform. This pulled previous policies and introduced important new ideas
A change in the pattern of financial flows in the NHS moving to payment by results (PbR) using a tariff system. "Health Resource Groups" would establish a standard tariff on regional basis for the same treatment regardless of provider.
Foundation Hospital Trusts would be identified. They would be established as independent public interest companies, outside Whitehall control, and governed only by performance contracts and inspection by the Healthcare Commission. They would have greater freedom of decision making.
A new Commission for Healthcare Audit and Inspection (the Healthcare Commission) would be created by legislation, taking over the responsibilities of the Commission for Health Improvement, health audit responsibilities of the Audit Commission and also those of the National Care Standards Commission, a body concerned with the private sector that had only been in operation for three weeks. Spending increases would be linked to a strict routine of independent audits.
The wheel had turned full circle within a decade and was returning to something like the Conservatives' market reforms. Alain Enthoven described the plan as a bold wide-open market, more radical than the previous Tory version of an internal market system. Kenneth Clarke agreed that it was the internal market re-written, and it was oriented to patient choice and devolution. His reforms had faced a barrage of criticism from medical organisations; now there was little protest.
Modernisation and the Modernisation Agency
Modernisation became the mantra. Many of its concepts had a transatlantic origin and the new NHS Modernisation Agency worked on projects with the Institute for Healthcare Improvement in Boston. Changes in skill mix, including the use of nurses for triage and to replace medical staff, reflected the development in the USA of nurse practitioners in the eighties. Treatment centres were similar to US ambulatory care centres. Health Resource Groups were akin to Diagnostic Related Groups. Even national service frameworks owed much to the US guideline and health care pathway movement. The enthusiasm of those outside government who had been involved in the NHS Plan's construction was channelled into the Modernisation Agency and its task forces to encourage transformation, change, improvement and innovation.
Modernisation, a concept to which doctors might be antagonistic partly because of the fear of the increasing power of management involved
acceptance that all clinical decisions had resource consequences
recognition of the need to balance clinical decisions with accountability
support for the systematisation of clinical work
acceptance of the power sharing implications of team work (Degeling P et al, BMJ 2003; 326: 649-52)
The NHS Modernisation Board included several Trust chief executives, a professor of surgery (Professor Ara Darzi), a senior nurse, and board members of the Alzheimer's Society, the Citizens Advice Bureaux and the Commission for Racial Equality. The Board's function - to monitor and advise - resembled the NHS Management Board established in 1984 in the wake of the Griffiths Management Enquiry. The Modernisation Agency grew like Topsy, attracting quality staff from trusts and authorities. Its chief executive, David Fillingham, said that the Commission for Health Improvement (CHI) was about performance assessment and the Modernisation Agency was about performance improvement. The Agency became involved in helping failing trusts, running some 60 different programmes. It brought together the National Patients' Access Team, the Clinical Governance Support Team, the National Primary Care Development Team, the Learning Network Team and the Leadership Programme. All health authorities had to appoint their own "modernisation" teams By 2004 the Modernisation Agency employed 760 people and had a budget of £230 million but the Department, engaged in a review of quangos (NHS bodies at arm's length from the centre) decided to reign it in. Lessons learned were distilled into ten high impact changes
The bulk of its work was devolved and the Modernisation Agency was closed in 2005, parts being integrated into a new NHS Institute for Improvement and Innovation. The Institute continued the attempts to spread best practice, breakthrough innovations, ideas and proven improvements. Safer care, quality, the use of indicators and commissioning were among the topics it handled.
In 2004 John Reid published the NHS Improvement Plan, four years after the publication of the NHS Plan itself. This stressed the importance of the care of chronic diseases and of public health. It described a vision for the future -
The Improvement Plan, like the NHS Plan before it, set out a multitude of initiatives. Reid summarized the strategic direction as
Delivering more care, more quickly through investment and reform
Offering people more personalized care and a greater degree of choice
Greater concentration on prevention rather than cure
Labour had not traditionally favoured choice in public services although in 1948 Bevan had made it possible for people to be treated in any NHS hospital according to their clinical need. This freedom of choice was constrained a little by the Conservative NHS Reforms and considerably more by the Labour administration of 1997. Alan Milburn felt patient choice, important, and the ability of people to chose where they might treated and how might improve the system. Mooney H & McLellan A, HSJ 2003, 9 October, 12-3 In December 2003 the government published a strategy paper “Building on the Best; Choice, Responsiveness and Equity in the NHS” .
Proposals included:
| a bigger say in how one is treated | Within a patient's electronic medical record, a "health space" to make their personal preferences and personal details known to the health team; patients to see doctors' letters about them |
| access to a wider range of services in primary health care | New providers in areas where primary care had traditionally been weak; nurses to treat more ailments and injuries; commuters might register with a GP near their work while receiving out-of-hours services from their local PCT |
| more choice of where, when and how to get medicines | wider role for pharmacies and pharmacists, expanding over the counter remedies and easing repeat prescriptions |
| easier hospital appointment booking | People waiting over 6 months to be offered alternative provision; ultimately patient booking on-line |
| better patient information | using new technology and TV |
| source: Building on the Best; Choice, Responsiveness and Equity in the NHS December 2003 |
While there was concern about the financial consequences of patient choice and the quality of the data systems, from autumn 2004 patients waiting more than six months for elective surgery were offered the choice of faster treatment in at least one alternative hospital. Primary Care Trusts established referral management centres, sometimes bringing in clinical expertise to assess patient problems, sometimes helping to manage demand so that it stayed within financial limits. The alternative providers were often in the independent sector or new independent treatment centres, and trusts with spare capacity. By offering choice at the point of GP referral patients would be given the chance to control their own destiny and to choose the hospital that best suited their needs. The NHS Improvement Plan, told PCTs to offer patients four or five choices and that private/independent care should feature amongst these. A Patient-led NHS published in March 2005; allowed independent providers such as BUPA to be included on the list of choices, and suggested regional or national contracts with providers to reduce the transaction costs of multiple contracts. In January 2006 general implementation began, with patient information leaflets and a web site to help people. Patients might now choose private sector hospitals that many thought were cleaner, better managed, had shorter waiting times and provided better facilities. But if money followed into private hospitals, there was a substantial threat to the budget of NHS ones. Because trusts increasingly saw the need to promote their services, in November 2006 the Department consulted on a code to ensure that
From April 2008 GPs were able to refer patients to NHS hospitals and some independent treatment sector treatment centres anywhere in England for routine elective treatment. NHS trusts were able to advertise their services, advertising their waiting times, surgical results and infection rates. Testimonials and sponsorship from appropriate companies would also be permitted.
Our Health, Our Care, Our Say.Long anticipated, the publication of this White Paper by Patricia Hewitt in January 2006 proposed a shift of resources from hospitals into the community. Community hospitals in areas of high population - perhaps with a different functional content, no beds but a range of clinical specialties - would be encouraged. Major hospital development should be reviewed, and 5% of health resources should be shifted from hospital to community services over the next ten years. The White paper envisaged
Shifting expenditure from hospitals to the community and preventative services
Bringing some specialties from the hospital nearer to people, e.g. dermatology, ENT, orthopaedics and gynaecology
Encouraging community hospitals that provide diagnostics, minor surgery, outpatient facilities and access to social services in one location.
Pilot a new NHS “Life Check” (initially by questionnaire) to assess people's lifestyle risks, the right steps to take and provide referrals to specialists if needed.
Introducing incentives to GP practices to offer opening times to help patients in their area
Improving the services in deprived areas by additional money
Supporting people to self care by investment in the Expert Patient Programme
Developing an “information prescription” for people with long term health and social care needs and for their carers
Providing a Personal Health and Social Care Plan as part of an integrated health and social care record
More support for carers including improved emergency respite arrangements
A progress report in October 2006 discussed demonstration projects, GPs who were trained surgeons operating on hernias in upgraded surgery facilities, specialist nurses from hospital following up women who had been discharged early after mastectomy, and GPs with specialist interest seeing outpatients in place of consultants. The projects were worthwhile, but many required investment in premises or staff training, and did not seem likely to revolutionise health care or save much money. Indeed, within a year the £500 million suggested for a community hospital programme seemed to be disappearing.
A new Review - Our NHS - Our future and High Quality Care for All
Sir Ara Darzi, who had just completed a a review of London services for the SHA, A Framework for Action, was sucked into the Department as Minister, as a new Secretary of State, Alan Johnson, took office in 2007. Within days Johnson had set in hand a further review of the NHS which shared the characteristics of its predecessors that the centre "would listen to staff and people, the experts on what was wanted and what could be done". Darzi, immediately elevated to Lord Darzi, took charge to ensure that the review would be clinically centred on health care, rather than on organisational structure. People assumed that what he had suggested for London he would mean for the rest of the country. The timescale would be rapid, less than a year, and clinical issues were considered within the framework already set out in the London review e.g. mental illness, maternity, acute care). The discussions at a national or regional level were at a general level. A tour of "engagement sessions" set out the centre's ideas. Local discussions followed but there was no sense that these discussions modified anything; consultation was far from evident. Some cynicism greeted the commitment of yet a further review "to listen". In October 2007, at a time when the possibility of a snap election was being discussed, Lord Darzi published an interim report. He seemed to be moving into a role as a Minister rather than a clinician. Regions conducted their own mini-Darzi reviews, published in April/June 2008, on how they saw service development and followed the tone of what the centre expected but contained few surprises.
Lord Darzi's final report, High Quality Care for all, appeared in June 2008 at the time of the 60th anniversary. It was immediately followed by separate strategies on primary and community care, workforce issues (A High Quality Workforce), and informatics. As usual, there was much repetition of. achievements and policy already announced - but there were new slants. There was an emphasis on quality and a draft constitution for the NHS. The idea of a constitution had been trawled by the BMA in a report in 2007. The draft pulled together existing rights, responsibilities and pledges in one document. It included the right for patients to make choices about their NHS care, including choosing their general practice and expressing a preference for using a particular doctor. The constitution would be reviewed every 10 years and be accompanied by a handbook that sets out current guidance. This would be revised every three years. The draft constitution reaffirms that the NHS is a comprehensive service; that access should be based on clinical need, not an individual’s ability to pay; and, with a few exceptions, that the NHS should be free of charge. Other rights included the right to drugs and treatment recommended by the National Institute for Health and Clinical Excellence, if approved by the patient’s doctor, and "to expect local decisions on funding of other drugs and treatments to be made rationally following proper consideration of the evidence." See Constitution
The King's Fund summarised High quality care for all.
The proposals – and the pitfalls | |
Hospital and GP budgets directly linked to quality of patient care | Payments to hospitals conditional on the quality of care as well as the volume under a commissioning for quality and innovation scheme. Quality measures will include infection rates, clinical outcomes, patient experience and patient-reported outcomes But fines may penalise struggling trusts further. High cost of the proposals |
Legal rights for patients to choose a GP practice and to express a preference for a certain doctor | But availability and convenience of services are likely to determine choice as much as quality |
Legal right to access any appropriate drugs approved by the National Institute for Health and Clinical Excellence (NICE). Health trusts must “explain” their decision to refuse treatment if not approved by NICE | Patients will get new drugs more quickly but this may increase pressure on budgets and trigger lawsuits from those who go without |
Legal right to seek treatment in the rest of Europe if faced with an “undue delay” in | This is already the case in EU law, but it is uncertain how long the waiting time has to be to enact this right |
Personal care plans to 15 million patients with long-term conditions such as diabetes and asthma. A pilot scheme will give 5,000 patients the opportunity to control their own healthcare budgets | Enables more people to be treated at home and prevents repeat visits to hospital. However, it would not be workable without community nurses to support them |
Ten regional “vision” documents, published in the last two months, and local health consultations will determine specific changes | Most documents add little to current, accepted, policies. Local consultations will introduce at least 150 new GP-led health centres (also known as polyclinics). Doctors leaders say this, and plans to consolidate some hospital units such as maternity and A&E, may lead to the loss of local services |
A review of doctors’ postgraduate training, focusing on the first two years after graduation from medical school | Hopes to improve specialist training, but cuts to European working hours still threaten to limit the time junior doctors can spend training and overseas trained doctors present major competition to those trained in the UK and Europe |
| Proposal for an NHS Constitution | Details unclear |
Sources include - The Times 1 July 2008 |
Structural change was continuous throughout the decade 1998-2007 with major change in 2002 and 2006. New organisations were formed, functions were redistributed, and within a few years they might be merged with others or abolished. The New NHS - Modern, Dependable began this process. The eight regional offices of the Department of Health’s Management Executive, recently declared to be central to the system, were said now said to be redundant. In April 1999 adjustments took place, as a result of which a single region was temporarily established for London. Within their new boundaries continuing mergers and reorganisations took place.
Source - Audit Commission 2008 - Is the Treatment Working?
An organisation chart circa 1998/9 looked roughly as follows
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The decision by Labour to abolish GP fundholding led to a search for other methods of giving primary care power and influence over the use of money in the hospital sector. From this flowed the Primary Care Groups and later Primary Care Trusts. Like a pack of cards, other organisations had to change to fit in. As PCTs were given substantial control over expenditure, the function of health authorities diminished and they were abolished. The organisational structure began to unwind and the functions of the regional offices and the Department of Health came under scrutiny. Ultimately change affected every level from the GP to the Secretary of State.
Subsequently the NHS Plan (2000) set in train the largest reorganisation of the NHS for many years. Mr. Milburn said that the NHS seemed top heavy, with the NHS Executive, eight regional offices, 99 health authorities and confused lines of reporting. Power would instead move to the front-line. The regional offices were reduced in number to four; with a regional director for health and social care and a small core of staff, part of the Department of Health and co-located with other government regional functions.
The Health and Social Care Act (2001) gave Government new powers, which amongst others allowed the Secretary of State to form or give grants to companies to provide services formerly provided by the NHS, and to employ doctors, nurses and other clinical staff. It also made possible a new form of Trust. Care Trusts would provide closer integration of health and social services, have local authority members on their boards, and might have pooled budgets, commissioning arrangements spanning both health and social services and the ability to delegate functions. They would be based either on a PCT or an NHS Trust and encourage partnership and integrated provision. Areas that already had well-developed integrated services, for example Wiltshire, planned to introduce such trusts. Broadening the range of options for health and social services to deliver integrated care, they would be able to levy charges, in particular for 'personal care'. The first such trust to be approved was Northumberland, where the Northumbria Healthcare Trust would be associated with social care services, have a budget of £330m, and over 1000 staff. Three other new care trusts, in Bradford, Manchester and Camden & Islington, united mental health trusts and social care.
On 1 April 2002 ("devolution day") a substantial change in organisational structure took place. Some 20,000 staff were affected as authorities merged, disappeared or were re-formed. Responsibilities were reallocated and the absence of clear guidance gave an impression of making things up as one went along. Alongside the NHS structure were a substantial number of special health authorities, non-governmental bodies and executive agencies
The Department of Health
From
1985, when the Department of Health accepted the Griffiths Letter and created a management cadre within the NHS, it began to change its own structure. Internally the Department was divided into an NHS Management Executive, while "wider" Departmental functions e.g. international health, remained within the remit of the Permanent Secretary. Increasingly the Management Executive was staffed by people with managerial skills from the NHS or outside it, as opposed to career civil servants. The relocation of the Management Executive to Leeds in 1992/3 increased this, and progressively the running of the NHS came to seem the most important function of the Department - and one requiring great and continuing political influence.(Greer SL, Nuffield Trust 2007) In 2000 the top jobs of permanent secretary and chief executive of the NHS Executive were re-combined. The Department was now far smaller than previously, focussed on delivering political objectives, and perhaps weaker on policy research capacity. The latter role would often be filled by political advisers, often brilliant but with a particular agenda. Rudolf Klein wrote that "As of May 2006, only one of the top 32 officials in the DH was a career civil servant, whereas 18 came from the NHS and six from the private sector. The shift has been from those who saw their role as being to save ministers from themselves, to those who saw it as being to deliver results. If the pathology of the former approach was conservative obstructionism, that of the latter was a readiness to run with even the silliest ministerial initiative." BMJ 2007;335:2-3 (7 July).The Department would
set strategic direction, distribute resources and determine standards
ensure integrity of the system through information systems, staff training and support for development
develop values for the NHS through education, training and policy development
secure accountability for funding and performance, including reports to Parliament.
Four new Regional Directorates of Health and Social Care (DsHSCs) with a small staff and similar functions replaced the 8 regional offices and oversaw the NHS and the link between NHS organisations and the central department. The new directorates, North, South, Midlands and East, and London did not map the boundaries of the previous eight regional offices.
When they had only been in existence for 9 months, the Department of Health reviewed its functions yet again to shrink its staff and move jobs away from London. Regional directorates disappeared, some of their work was redistributed to the 28 SHAs (see below) or to new organisations such as CHAI and the Health Protection Agency that were being established. From 2000 onwards the Department began to appreciate the problems that centralism and micromanagement would produce, and began to disengage increasingly from the front line. Devolution, and Foundation Trusts, were one result of this.
Strategic Health Authorities (SHAs)
SHAs were now created taking some of the work of the erstwhile Regional Offices. They would
develop a coherent strategic framework
agree annual performance agreements and performance management agreements
28 Strategic Health Authorities replaced the 96 remaining Health Authorities and managed the local NHS on behalf of the Secretary of State translating national policy into local strategy. Each had a board with five non-executive directors, a CEO, a medical director and a director of finance. There might also be directors concerned with strategy, planning and development. The CEOs were, as a group, board brush rather than detail people, charismatic, networking, political and with a clear view of what they wished to achieve. They had an average budget of £4 million each and constructed plans, annual delivery agreements and annual performance agreements. They were not be involved in operational management, or responsible for revenue allocations. They shifted from being part of the provider system to regulation, to ensure that the recommendations of bodies such as the Commission for Health Improvement were acted upon. They would lead the strategic development of the service, coordinating service level agreements that set out what PCTs would commission from trusts and at what cost. They "performance managed" PCTs and NHS Trusts on the basis of local accountability agreements. They prioritized major capital plans and might, for example, examine the pattern of family doctor, primary care, community, and hospital services and use major capital schemes to establish new and better patterns of working across PCT and hospital trust boundaries. In London there were five SHAs, not unlike the inner parts of the old Regional Health Authorities (for the shire counties had been separated) reflecting the five sector scheme of Turnberg. SHAs related to between 5 and 19 PCTs.
| Strategic Health Authorities - 2002 | |
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Workforce Confederations that planned health service manpower were integrated into the SHAs, which would develop 'clinical networks' (as the Regional Hospital Boards in 1948 had matched universities and university medicine). Should they wish, they could associate to discharge functions better fulfilled together. The five London SHAs did so, dividing certain responsibilities, for example children's services, or the Ambulance service, between themselves.
Primary Care Groups and Trusts
The organisation and management of primary care had changed comparatively little over the years. Now there were radical and progressive alterations. Before long the organisations confusingly named as "Primary Care" had expanding responsibilities that spread far wider into commissioning most hospital care, much under a tariff system..
Labour had abolished fundholding and made the formation of primary care groups a centrepiece of its reforms. The knock-on effect of this on the rest of the NHS structure was only slowly appreciated. Health service money was increasingly be disbursed through primary care groups and trusts. Only a minority of NHS managers had experience in primary care - most gravitated to the hospital service. Organisational development and training, information technology, and the resources necessary to develop primary care management had been lacking. Legislation underpinned their introduction in April 1999 when Family Health Services Authorities (FHSAs) disappeared and 481 Primary Care Groups (PCGs) were established in England and fundholding ended in England.
GPs were now brought together organizationally with community nurses within PCGs to integrate GPs, community health and social services. PCGs, initially subcommittees of health authorities, were a step for GPs into a corporate world. They had complex functions including the provision and commissioning of care, and partnership across public, private, personal and voluntary care sectors and were said to have a lead role in improving health, reducing inequalities, managing a unified budget for the health care of their registered populations, improving quality, and integrating services through closer partnerships.
PCGs ran for a while in parallel with their health authorities while evolving, often by merging with others, to become Primary Care Trusts (PCTs) with wider functions including clinical and financial responsibility for prescribing and referral decisions. The number of health authorities began to fall, driven by a progressive reduction in their responsibility for commissioning services. In the first wave in April 2000, 17 PCGs became PCTs. By 2002 there were 302 PCTs covering populations of about 170,000. There was wide variance in the number of PCTs in each SHA and in their population size. Most PCT boundaries were set with coterminosity in mind, matching the boundaries with those of local authorities. In London there was always a match with local authority boundaries.
Functions of PCTs
The advantages of being big - managing risk and economies of scale - clashed with the advantages of being small, adaptable to local needs and being close to primary care. As Trusts grew bigger their discussions were increasingly concerned with broad planning issues (for example the commissioning of complex supra-regional hospital services), and less in details of individual practices and patients. PCTs were very expensive organisations and many merged for this reduced the transaction costs of contracting. When the first chief executives were recruited there was no knowledge of the major role expansion about to happen - responsibility for the bulk of NHS funding. The pool from which the appointments were made was therefore comparatively small but because of the turmoil of change, PCT staff came from many different organisations with different types of skill. In April 2003 allocations were made directly to PCTs and the health authorities were wrapped into SHAs. The allocations to PCTs followed the earlier principals of RAWP. In 2008 four elements were used to set PCTs’ actual allocations:
PCTs placed an emphasis on planning. "Service Level Agreements" were succeeded by more complex systems of planning with "Joint Specific Needs Assessments" on the basis of which contracting was organised. Ultimately PCTs began to specify the details of what they wished to purchase, and the clinical pathways that were desired, rather than the individual procedures. They had to answer the questions "What did an area need? What did the PCT want to buy? And what was available locally?"
PCTs had to develop new and commercial commissioning skills for their decisions were open to challenge, particularly when independent contractors tendered. It was important for the PCTs to work with providers wherever possible to ensure that nobody had a nasty surprise. No more than 10% of services were commissioned regionally or nationally (because they were highly specialised), and GPs were involved through practice based commissioning, in which GPs had the right to advise the PCT on the services required.
NHS Trusts
Hospital trusts were least affected by devolution day, although they were expected to encourage the growth of clinical networks across NHS organisations and work with local authorities. Their lines of accountability changed repeatedly as the organisations around them shifted their functions. High performing Trusts would earn greater freedom and autonomy in recognition of their achievements. They were accountable upwards to regional officers and later SHAs for their statutory duties, and to health authorities and later primary care trusts for the services they delivered. The separation of planning from provision and decentralization of hospital management was maintained. Trusts had new and major tasks, from the provision of family friendly employment policies, to networks of clinicians within the NHS, and with social services. The number of Trusts fell through merger; 22 trusts merged in 1998 and a further 49 in 1999. Like PCTs, Trusts were responsible for minor capital works, receiving block capital allocations for the purpose. As employers they were represented on the Workforce Confederations. Strategic Health Authorities would control further capital allocations to aid strategic change and modernisation.
The concept of foundation hospitals and trusts is said to have emerged in 2001 when Alan Milburn visited a Madrid hospital freed from detailed bureaucratic control and able to borrow money from big banks, rather than using funds under tight public control. Perhaps government, having attempted to micromanage the NHS, had realized that with control went responsibility when things went wrong and this had political fallout. The idea was trawled in a speech to the New Health Network in January 2002, and several trusts soon expressed an interest in piloting the proposals. In July 2002 acute hospital trusts were told they could apply to be "NHS foundation trusts". Legislation would be necessary and details appeared in December in the circular The guide to NHS Foundation Trusts. Two central ideas were
a new form of social ownership with services owned by and accountable to local people rather than to central government
decentralization and devolution
Each NHS Foundation Trust would have a Board of Governors representing the interests of patients, staff, local partner organisations, local authorities and the local community. The Secretary of State for Health would not have the power to direct, nor be involved in appointing their Board members. The Trust's Management Board would be accountable to the Governors, who would elect the chair and non-executive directors. It was a complex model - perhaps over complex - and not entirely to the liking of some managers.
Foundation Trusts were part of the NHS but had greater financial and managerial autonomy including freedom to retain surplus finances, to invest in delivery of new services and the flexibility to manage and reward their staff. The Department of Health wanted trusts to be free to borrow money off the public balance sheet; the Treasury did not, fearful that trusts would run up debts that they could not handle and would need to be bailed out at public expense.
The idea split the Labour Party. Some MPs feared that foundation status would fragment the NHS and create a two-tier system in which the best hospitals could get more cash and poach staff, that it would effectively denationalise the NHS and allow back-door privatisation. Conservative, Labour and Liberal Democrat MPs all had objections. As a result Trusts' freedom was progressively constrained. NHS foundation trusts would be able to borrow to improve services, but borrowing would be on the government's balance sheet and come off the departmental expenditure limits that the Treasury had agreed. Pay and conditions of service would be within The Agenda for Change, a national personnel policy. They would be accountable (through contracts) to PCTs. Contracts with PCTs would last several years to provide some financial stability and would be legally binding. There would be an independent regulator (Monitor) tosupervise them and decide what services should be provided and if necessary dissolve Trusts. There would be safeguards to prevent the sale of hospitals or their assets and limit the extent to which NHS foundation trusts could undertake private practice, a huge problem for some hospitals such as Great Ormond Street that had a massive international practice. Nevertheless foundation trusts would be able to redevelop and reequip themselves more easily and carry over surplus money year on year. Just as, ten years previously, hospitals had been invited to apply for Trust status and this had become the norm, it was now expected that the norm would be NHS Foundation Trusts.
In March 2003 the Health and Social Care (Community Health and Standards) Bill was introduced to provide the legislative framework for foundation trusts (and other new organisations such as CHAI). John Reid took the Bill through the House and many Labour MPs voted against it; indeed it was the votes of Scottish MPs, whose constituencies were unaffected by the legislation, which saved the government when the Bill first passed the Commons in July 2003. From then until November 2003 the Bill was passed acrimoniously from the Commons to the Lords and back again. To allay concern on Labour backbenches, John Reid asked the Healthcare Commission to carry out a review of the first 20 Foundation Trusts.
Foundation trusts remained divisive. To the proponents they would set the NHS free from the yoke of central government. To opponents they were a backdoor privatisation that would destabilise the NHS and introduce a two tier service. Some claimed that they were in the teeth of Bevan's vision for the NHS and destroyed concepts of equity and universality. Others believed that a varying quality of service from place to place was inevitable within such an immense health care system, that patient choice was required and that more freedom encouraged development and improvement of the NHS to the benefit of all. The Bill appeared the most controversial piece of legislation to come out of the government's 10 year strategy for the NHS in England. It eventually passed in November 2003. At the same time it was a ministerial objective to offer all trusts the opportunity of foundation status within five years and John Reed gave a further twenty the green light to apply for foundation status in July 2004. Monitor made it clear that the level of financial and managerial expertise required would not be lowered..
NHS Foundation Trusts differed from existing NHS Trusts in three key ways:
| The Board of Governors Foundation hospitals have a board or council of governors that is separate from the board of directors. It is made up of governors elected by staff, patients and the public, along with representatives from the local PCT, (university) and local authority. At least half the members must come from public or patient constituencies. The governors are not responsible for the day to day management of the organisation, budgets, pay or other operational matters - executive power lies with the directors. But the governors appoint the chair and non-executive directors and determine their pay. |
Monitor, an independent regulatory body, was appointed under the Health and Social Care (Community Health and Standards) Act 2003 to assess, authorise and regulate NHS Foundation Trusts. Chaired by Bill Moyes, previously the Director-General of the British Retail Consortium from 2000 to 2004, it considered the applicants. One of the first Foundation Trusts, Bradford Teaching Hospitals, moved rapidly into a large and unpredicted deficit. The governors had were denied key financial documents by the directors and wrote to Monitor. Monitor called in auditors and replaced the chairman and management team to achieve fin
