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Health Series: Expert Comment

Bureaucracy preventing NHS from delivering on its promises

Health Economist Dr Mauro Laudicella comments on the King’s Fund report on NHS reorganisation
by George Wigmore (Senior Communications Officer)

A new report from the King's Fund has criticised the reorganisation of the NHS following the Health and Social Care Act 2012, with subsequent changes distracting from patient care according to the health think tank.

Designed to devolve decision-making when presented the bill put forward the idea of devolving powers to Clinical Commissioning Groups (CCGs), NHS organisations set up to organise the delivery of NHS services in England.  The idea was that by putting GPs in control of commissioning this would extend competition and choice. Instead, since the passing of the bill according to the King's Fund there is "less emphasis on competition and greater efforts to strengthen the regulation and quality of care and prioritise patient safety".

Commenting on the report and the bill Dr Mauro Laudicella, a Senior Lecturer in Health Economics at City University London, said:

"The Conservative NHS reform introducing the Clinical Commissioning Groups (CCGs) makes sense if we consider the point of view of the Economic theory. Previous reforms such as Patient Choice and Hospital Competition (introduced by the past Labour administration and then supported by the Conservative) have to some extent missed their target of delivering better hospital quality of care driven by patients' choice of the best provider. Many patients express strong preference for their local hospital and unwilling to change for a better one located a few miles away.  As a result, hospitals need stronger signals than patient flows before implementing expensive and long term investments into quality.

In practice, the system is lost in an intricate net of bureaucracy and regulations that are preventing it from delivering on its promises
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"The introduction of CCGs aims at filling this gap by empowering the system of incentives in the current competition arena. The CCGs are consortia of GPs who are supposed to have the best knowledge of the needs of their local population and the standards of care of the local hospital providers. Therefore, the CCGs are meant to act as "patients' agents" and make the shopping and choosing of the best care services on the behalf of their patients. The CCGs have to tender the services they intend to commission and hospitals have to compete on quality and cost to win the contracts. In theory, the CCG system should deliver value for money and putting the patient at the centre of the health care services.

"In practice, the system is lost in an intricate net of bureaucracy and regulations that are preventing it from delivering on its promises. CCGs are unfamiliar with competition regulations and therefore are investing part of their resources to get legal advice. CCGs are also unfamiliar with accountancy and management of large budgets, so other funds have been devoted to secure the appropriate support on that front. Finally, a number of different agencies have been created to overlook at the correct functioning of the system absorbing yet additional resources.

"Part of the costs of setting up the CCGs system are one off investments and these will reduce in the future. Other costs are needed for running the new system and are on-going. Whether the costs of the CCG reform are going to be outweighed by the benefits that it has promised to produce is a bit too early to say. It will take some years before the effect of the choices made by the CCGs can materialised in terms of better quality of care and better health outcomes."

Definition
Clinical Commissioning Groups (CCGs)

Clinical commissioning groups (CCGs) are NHS organisations set up by the Health and Social Care Act 2012 to organise the delivery of NHS services in England.

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