Choice and competition in the NHS


Is there such a thing as patient choice?

Healthcare is now so complicated that the patient would have a great deal of trouble making a choice. If they want to know what is the best treatment for their condition, they're pretty much entirely reliant on their GP. If they want to actually choose which hospital or specialist service provider to go to, then what are they going to rely on? Probably not the league tables.

Most likely, patients will choose the most convenient option, the hospital that has the monopoly on care near their home. Even if they consider changing, it will probably be based on rumour and PR. Is this an opportunity for organisations with big marketing budgets? You bet it is! And do public service organisations have big marketing budgets? Well, they certainly don't understand marketing like private health care providers do.  Does this make competition bad, and the introduction of private providers a disaster?  No, but there are issues which need addressing.

If patients are so reliant on their GP's opinion, what does their GP used to make a decision?

The GP has a menu of services provided under Choose and Book. There are currently discussions about whether Any Willing Provider (AWP) or Any Qualified Provider (AQP) will get onto the Choose and Book menu, and whether prices will be determined as tariff, or whether competition in pricing will also be allowed.

Competition – "a big opportunity for commercial healthcare" in the UK (Mark Britnellspeaking in the USA)

My last post pointed out how naive England is about private providers. Many are outstanding, excellent. But there's nothing in the system to prevent the bad apples coming and spoiling the whole bushel. They enjoy a different regulatory regime. This makes it easier for them to publicise the good PR, and to hush up the bad – to get to the patient, and persuade them to choose on the basis of advertising rather than on the basis of merit.

It's very difficult to introduce competition in the health service.

Gearing up to provide universal health care is expensive. Short-term contracts (three years, five years) represent too much of a risk. Investing tens of millions of pounds in the building and equipment to provide services to modern standards is a big risk without 10 or 20 years to spread the risk, but our current commissioning competence is woefully inadequate for signing long-term contracts.  Let’s look at where private healthcare is the main provider, and where the bulk of the population (well, 70%) actually use the healthcare provided.

The example is the USA: health care costs a whopping 15% of GDP – that's around $8000 per man, woman and child, $1 in every  $6 that circulates.  This compares with the UK: 8% of GDP, $3500. The important question, I suppose, is why are we trying to imitate them?

But if the US health service is so much more expensive, does it deliver a much better service?

This is particularly difficult to answer. We in the UK, and the US, are rich enough to kill ourselves. We can afford far too much alcohol, far too many fats and calories, we can afford to do nothing – to kill ourselves through inactivity. Life expectancy at birth in the US is around 78 years for a female; compare this with 79 in the UK, and an average across Europe of 80.5. Compare Japan's life expectancy of 83 years – on second thoughts, don't. A recent examination of pension fraud in Japan estimated that around one third of pensioners claiming pensions were in fact dead, and had been for many years. It's quite possible that life expectancy in Japan is not quite as exemplary as we've been told!  What we don’t know is whether healthcare is to blame for US having worse life expectancy than UK, or is it traffic accidents and guns.

Choice may drive up quality, or it may drive it down

Put simply, choice relies on perfect knowledge, and we definitely don't have so much of that in healthcare. It is very easy for an independent provider to distort the patient perception. Driving up quality needs a level of regulation which is not in the current health proposals.

Let’s explore quality in the next blog post.