Saturday, 3 April 2010

Conservative Draft Manifesto on Health

Privatisation Agenda

The Conservatives have published several policy documents about the NHS and this blog post covers their Draft Manifesto on Health.

The first thing that is extremely obvious is the Conservatives intend to have a much larger involvement of private suppliers in the NHS. The manifesto is littered with terms like "any willing provider", "choose any healthcare provider", "new independent and voluntary sector providers", "allow new providers" and "encouraging hospitals to compete for patients".

Where is the commitment to existing NHS providers? There is just one mention: "set NHS providers free to innovate by ensuring they become autonomous Foundation Trusts". Foundation Trusts are a Labour innovation and the Conservative party were firmly against them, voting to block their introduction during the passage of the legislation through Parliament. The Conservative party have suddenly decided that this Labour policy has merit, but do not acknowledge that they were wrong to try to block the legislation. Other than this single mention, the "draft manifesto" gives no other support for NHS provider, in fact, quite the opposite, they openly admit that they will cut the funding to NHS providers in situations when more investment is clearly needed: "hospitals will not be paid in full for a treatment which leaves a patient with an avoidable infection".

The Conservatives say that they will "ring fence" funding for the NHS, so let us take this at face value, and assume that they are telling the truth. Since their manifesto shows no commitment at all to existing NHS providers, where is the ring-fenced NHS funding going to go? The answer is clear: it will go to the "any willing provider" that they mention time and time again in their manifesto.

The idea of "choose any healthcare provider" (not
choose any NHS healthcare provider) is the tired old Patients' Passport that was the Conservative health policy at the 2005 general election. That policy was based on an idea that somewhere in the Department of Health there is a pot of money with your name on it and if you need healthcare you should be able to take that pot to any healthcare provider you wish. The original plan was to allow patients to have their NHS pot of money and add their own funds to it to get premium private treatment. This policy was interpreted, quite rightly, that the NHS would be subsidising private care, and that the long term effect would be the reduction of NHS providers until the only providers would be private providers and most patients having to pay for treatment. The electorate were not convinced by this idea and rejected it in 2005.

The Conservatives have tweaked this idea, they now say that they will "give everyone the power to choose any healthcare provider that meets NHS standards" and "if they can deliver a service that patients want, to a high standard and within the NHS tariff". In other words, the current Conservative policy will be the Patients' Passport without the option for patients to add their own funds for the treatment. However, there is no explicit guarantee that this embargo on top-ups fees will be permanent. The likelihood is that once this policy is in place patients will be allowed and encouraged to contribute extra. Indeed, it is easy to imagine that private providers will perform the bare minimum of the requested procedure at the NHS tariff while offering the patients "additional care" at an extra cost. Such "additional care" could easily be applied to the drugs used ("this drug is not available on the NHS, so you will have to pay extra to receive it"). Look at how the dual system of NHS and private treatment works in dentistry: dentists try to persuade patients to have additional, private treatment; this is what will happen in the future with hospital treatment. The result, of this policy, like the original Patients' Passport will be to remove funding from NHS providers, and lead eventually to the closure of NHS hospitals.

The Conservatives intend to create a super-quango called the NHS Board. In their health policy document in 2009, the Conservatives specifically say that the "commissioning of NHS services will be separate from healthcare providers and overseen by the independent NHS Board." In other words, the NHS Board will dictate which providers local commissioners are allowed to use and since the Conservatives say that "we will enable any willing provider, who is able to meet NHS standards within NHS tariffs, to offer services to NHS commissioners" it is clear that they expect the NHS Board to force local commissioners to use private providers. David Cameron will ensure that the NHS Board follows his privatisation plan because although the super-quango is described as "independent" the Conservatives' 2009 policy document says that "the NHS Board members will be appointed by The Secretary of State for Health" in other words they will be political appointees, and inevitably politically aligned to the right-wing Conservative party lead by David Cameron.

Apart from a general plan to provide NHS resources to "any willing provider" the "draft manifesto" makes specific promises. In maternity care it says they will "allow new providers", in terms of patient records they say they will allow patients "to choose which providers they share them [their patient records] with" and worryingly when it comes to mental health services, the Conservatives will "remove the rules preventing welfare-to-work providers and employers purchasing services from Mental Health Trusts" when clearly these services should be free-at-the-point-of-delivery and not purchased at all.

In addition, the Conservative "draft manifesto" has a rather obscure statement about public health. "we will provide separate public health funding to local authorities", what does this mean? Currently public health is carried out by a variety of NHS providers: Primary Care Trusts, hospital trusts and GPs and the current budget is about £3bn a year. The Conservative plan is to take this funding from existing NHS providers and hand it to local authorities, who have no experience of providing public health. This seems very odd and a clear recipe for disaster. However, notice that most local authorities are Conservative held, so this will be £3 billion of extra funding to Conservatives councils. Furthermore, a local authority with no experience of providing public health policies, particularly a Conservative council, will be naturally inclined to purchase that expertise from a private provider. This is the real reason for this policy from the Conservatives: a whopping £3bn of cuts to NHS providers and a corresponding £3bn cash injection into the private sector.

Interestingly, the Conservative spokesman on health, Andrew Lansley has received funding from a private health supplier. CareUK is one of the country's largest private healthcare providers and contributed £21,000 to the running of Lansley's office. (Originally reported by Paul Waugh.)

This lack of commitment to NHS providers and the zeal for using private providers heralds the beginning of a wholesale privatisation of the NHS.

New Funding Arrangements

Conservatives like the carrot-and-stick approach, the problem is that the way they make the rules means that the private sector gets lots of carrots and the public sector (in this case NHS providers) get lots of stick. This is apparent in their new funding arrangements.

First, let's make something clear: all procedures have costs and if a hospital is not reimbursed for those costs it will make a loss, get into debt, and eventually become a failing hospital. It is the responsibility of the Department of Health to make sure that funding arrangements are such that hospitals are reimbursed to cover their costs while providing good quality care and keeping a control on costs. The Conservatives will, of course, franchise the responsibilities of the Department of Health to the new super-quango the NHS Board. Then the Conservatives will apply a lot of stick to NHS providers under a new payments system called payment for outcomes (or payments for results, a term which is deliberately chosen to be confused with the much fairer system already in place called payment by results, I will avoid the confusion by talking about outcomes and not results). Under the Conservative system of payments hospitals will have no guarantee that they will be paid for the treatments they provide. The "draft manifesto" gives one example of how this will work: "hospitals will not be paid in full for a treatment which leaves a patient with an avoidable infection". Note that there is no offer of help to reduce hospital infection rates, no rewards for achieving low levels of infection. In fact, no carrots at all for NHS providers, just sticks, sticks, sticks. Mr Cameron must really dislike the NHS to threaten to continually beat NHS hospitals like this.

So who will get the carrots, and how? As the last section explained the overall theme of the Conservative "draft manifesto" is to bring in wholesale privatisation of services while maintaining, and even increasing, tax payer contributions; taxpayer contributions that are earmarked for the private sector and not NHS providers. How will the Conservatives do this? First, the NHS Board will be given a mandate to increase the amount of private sector involvement. Have you noticed that the "draft manifesto" does not say "existing independent providers" instead it says "new providers" over and over again? This shows the central theme of their privatisation plan. The Conservatives intend to create a plethora of new providers in a health market with the NHS Board providing the funding. The NHS Board, a super-quango with a £120 billion budget, has a hell of a lot of carrots to throw around, and the majority of these carrots will be thrown at new private suppliers. Expect that, when the details are produced, the NHS Board will be given a target of how much private involvement there will be. The resulting Conservative health bill will be similar to the rules imposed on the BBC by Margaret Thatcher under the 1990 Broadcasting Act. The Broadcasting Act says that 25% of the TV and radio broadcast by the BBC must be from independent producers. This had the effect of creating a large number of independent television producers. The Conservative plans for the NHS will be to create a large number of private healthcare providers, this is why the "draft manifesto" uses the term "new providers" so much.

The other main carrot for the private sector comes under the innocuous statement "value-based pricing". In practice this means that a Conservative government intends to pay drug companies more. They are not suggesting that they will do something sensible, like encouraging competition between drug companies by making more drugs generic; instead they will reward drug companies "according to the benefits the drug brings to patients". Call me cynical, if you like, but the NHS should only be giving patients treatments that they will benefit from, the NHS should not pay for treatments that do not have benefits. This new policy seems like a new way to turn more NHS money into profits for drug companies. The example that the Conservatives' 2009 health policy document gave describes exactly why this policy is wrong: the example was for a drug that was cheap to produce but since the drug saved the sight of patients the drug company priced it according to how much they thought patients would pay to keep their sight. The Conservatives endorse the sentiment in this drug pricing policy, and in effect it means that they want to hand more NHS funds over to drug companies.

Centralisation and Political Interference

The Conservatives' policy writers say many times that they want to end "political interference". They say that the unaccountable, super-quango, the NHS Board will "make sure the NHS is funded on the basis of clinical need, not political expediency". They say that they will "set NHS providers free to innovate by ensuring they become autonomous Foundation Trusts" (this is already a Labour policy). They say they will "give GPs the power to hold patients' budgets" (a repeat of the failed GP fundholding scheme). All of this seems to indicate a hands-off approach, a devotion to devolving healthcare decisions to patients and local commissioners. But that is not the case.

The NHS Board, of course, will be a huge, centralised body and "the NHS Board members will be appointed by The Secretary of State for Health", in other words, political appointees. The NHS Board will dictate commissioning rules to NHS commissioners, and these rules will be that they should use "any willing provider". They plan to interfere in the actions of NICE (who they call "unaccountable bureaucrats" who let "Ministers off the hook"). Furthermore, the Conservatives pledge to "stop the forced closure of A&E wards" which is more interference since decisions to rationalise A&E services should be taken at a local level.

All of these are actions of an authoritarian government who do not want to let go of control.

Unachievable Aspirations

Within the manifesto there are some pledges that are frankly unachievable. Why a policy writer would include something that cannot be achieved and can be easily proven so, is inconceivable. For example:

"[we will] cut the cost of NHS administration by a third"

A cut of a third in administration costs is a huge cut and it is inconceivable that this could be achievable without huge disruption and a breakdown of the service.

"we will allow everyone – on retirement – to protect their homes from being sold to fund residential care costs by paying a one-off insurance premium of £8,000."

To understand the problems with this policy you have to look at what it is intended to cover. Residential care costs at least £1000 a month (and easily more, depending on the location and the amount of care that is needed). So an insurance payment of a mere £8000 simply cannot cover the costs, it is a policy that cannot succeed due to lack of resources. The real reason for the policy is to highlight the Conservative support for inherited wealth.

Another pledge is:

"We will end the scandal of mixed-sex accommodation and increase the number of single rooms in hospitals, as resources allow."

The Conservatives originally promised an extra 45,000 single rooms at a cost of £1.5 billion, but on the 7 January when pressed on this figure David Cameron admitted that it was not achievable and said that it was simply an "aspiration". Here was Cameron admitting that the manifesto has at least one policy that could not be achieved, a Conservative lie

If we have learnt anything from the expenses scandal it is that the public want politicians to be honest and open. The fact that the "draft manifesto" includes policies that cannot be achieved shows that it is neither honest nor open.


There is very little of worth in the Conservative "draft manifesto" on health, but there is a lot to be worried about. First it shows the natural inclination in Cameron for centralising power, next it shows his zeal for privatisation and finally it shows dishonesty by claiming Labour policies as theirs and including unobtainable policies. It is clear that the only people who will benefit from these policies are the private healthcare providers. This is not a manifesto for the NHS it is a manifesto for private healthcare.

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