Getting one step ahead of the Public Sector White Paper changes

Anyone who has pursued a career in health provision for any length of time will recognise that NHS reform and reorganisation is a regular and recurrent process, invariably promoted as a means of delivering better services more cost effectively.Anyone who has pursued a career in health provision for any length of time will recognise that NHS reform and reorganisation is a regular and recurrent process, invariably promoted as a means of delivering better services more cost effectively. The latest manifestation introduced following the 2010 election feels different and is clearly part of a widespread reorganisation of services across the public sector.

The publication by the Government of its "Open Public Services" White Paper on 11th July set out the principles of increased choice, decentralisation, diversity, fairness and accountability that will underpin its reforms of public services across the board.  The detail of how these principles are to be implemented will follow in legislation specific to each area of the public sector.  In healthcare, the legislative vehicle will be the Health and Social Care Bill.

This controversial Bill was returned to Parliament in amended form on 14th July, following a two-month "listening exercise" conducted through the NHS Future Forum.   The final  form of this legislation will not be certain until it is finally enacted in spring 2012, but  it is already clear that healthcare is to experience major structural changes:

•    Primary Care Trusts are to be abolished and replaced by "commissioning consortia", led by healthcare professionals. It is expected that the majority of commissioning consortia will be operative by April 2013 but this is no longer an absolute deadline.

•    The "NHS Commissioning Board" is to be created to oversee the introduction of commissioning consortia.  It is envisaged that the Board will provide transitional services to providers and consortia that are not able to become fully operational by April 2013. 

•    Although the role of competition has been reduced, within and between consortia, public, commercial and voluntary healthcare providers, it is clear that there will remain a degree of competition for patients and the funding they attract. 

The prevailing theme of these reforms and the Government's philosophy on public services is to hand greater responsibility and independence to those who manage service providers.  The way in which they exercise this freedom and approach the challenges and opportunities of a more competitive environment will ultimately determine whether their practices thrive or wither.

In a time of austerity the agenda for health provision is changing to meet the challenge of an ageing population on an increasingly tight budgetary framework. As Professor Steve Field reported in the summary findings of the NHS Future Forum; "We will need to move resources away from hospitals so that we can provide more care in the community". There will be significant opportunities for those who grasp them as well as major challenges.

 
Practice managers can play a crucial role in responding to these challenges and will need to consider the following issues:

•    An appropriate balance will need to be struck:  On the one hand should a practice adopt a very competitive approach on behalf of an individual practice with a view to maximising income for that practice?  Or, on the other, should it pursue the stated aspiration to shape a new more cost effective and efficient NHS through locally-driven collaborative working between providers to make best use of available resources? Across a consortium the potential to focus specialisms, eliminate obsolete facilities and premises, and encourage sharing of facilities and resources could yield significant efficiencies and service delivery improvements. This is dependent on individual practices adopting a very different approach.

•    The importance of quality in the reformed system:  It is the Government's expectation that the use of fixed tariffs will prevent competition on price, instead requiring that competition be based on quality.  Patients will no longer be restricted by where they live in choosing healthcare providers and will be able to access a wider range of data on the performance of practices.  The aim is that patients will become informed consumers, who will be drawn to those providers with the best quality provision.

•    The need to provide services efficiently:  Fixed tariffs will make minimising costs while maintaining quality a continuing challenge. It seems likely that there will be downward pressure on the levels of the tariffs in the future as has happened in other areas of public sector provision.

•    The performance of administrative and managerial functions:  With the abolition of PCTs, the burden of administration will shift to the consortia and individual practices. If significant savings are to be achieved within the NHS the administrative burden will need to be reduced and managed by far fewer people.

•    Will consortia covering largely rural sparsely populated areas be at a disadvantage compared with urban areas?

In some areas reorganisation is already well under way ahead of the legislation.  For those looking to get ahead of the enforced changes, preparatory steps that practice managers may wish to consider at this stage include:

•    Exploring opportunities to co-operate with other practices and providers:  Practices may consider specialising in treatments and services in which they have a particular expertise and reputation.  This could be backed by a system of cross-referring patients to the agreed specialist practice within a consortium where this is in the patient's best interests. On a larger scale, the Bill envisages different consortia forming relationships by which they would perform functions jointly or on behalf of the other.

•    Exploring additional sources of revenue:  There may, for example, be opportunities to lease or licence underutilised premises space to community groups, other healthcare providers or private healthcare providers and providers of ancillary services, especially outside of normal practice hours.   

•    "Pooling" of back office functions between practices:  Alternatively, the option of engaging a commercial managerial services provider may prove more cost effective than carrying out all functions at a practice level.

•    Practices will no longer be guaranteed patients purely by virtue of their location:  There will be greater demands to raise awareness of a practice.  The GMC sets out rules regarding advertising by GP practices, and specialist guidance should be sought about this if there is any uncertainty as to what is permissible.  Without engaging in outright advertising, it is nonetheless possible to engage with communities and raise awareness, for example by becoming involved in projects that attract local press attention.

•    Seek out feedback from patients to allow areas for improvement to be identified, possibly through surveys or patient forums:  At the consortia level, the Bill will require affected individuals to be involved in the development and decisions of the consortia.  Furthermore, consortia will need to hold public meetings annually to present their annual performance reports.  Developing systems for listening to and taking on board the views of patients will therefore both allow barriers to high-quality service to be identified and begin the process of consulting with the public that will soon become a statutory duty.

Whatever one's view of the reforms, practice managers cannot afford to ignore them.  Some consortia will no doubt be faced with difficult and politically sensitive decisions, such as hospital closures, which may be essential to permit structural change.  In the education sector, where the moves towards greater independence for service providers and ‘learner outcome’ based funding are further advanced than in healthcare, there are some lessons to be learnt. Those who have embraced change and applied it early generally appear to have prospered at the expense of those who have held back. The need for accurate and robust reporting and accounting systems rigorously applied to track a patient's advice and treatment from start to finish with effective use of that information will be fundamental to maximising income.  Consortia and practice managers will need additional help to support them in meeting these challenges.  Above all, practitioners need to remain alert to the changes taking place and be prepared to be flexible in response.

In my next article I will be reviewing and comparing the response of practice managers in the South West to date.
 

First published in Practice Management September 2011

Ashfords LLP is regulated by the Solicitors Regulation Authority.  The information in this note is intended to be general information about English law only and not comprehensive.  It is not to be relied on as legal advice nor as an alternative to taking professional advice relating to specific circumstances.