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Dawn of the new world

What the new NHS means for pharma and healthcare comms

Dawn of a new world

On the face of it, there was little that didn't change about the NHS in April 2013. Old organisations were abolished and new ones created. Tens of thousands of managers were displaced. For many in pharmaland, this meant new 'customers' working for new organisations. Relationships that had been carefully cultivated over many years were rendered worthless. 

It is easy to characterise the reforms as a moment where the pieces of the NHS jigsaw were ripped up and thrown in the air. Yet in truth, when they landed, many look very similar to what went before. There is as much continuity as there is change.

Millions of words have been written about the rights and wrongs of the reforms. Now we are nearing a year in the new world, what has been the actual impact of the reforms? Have they (or perhaps should they) changed the model of pharma engagement?

New structures
The most visible aspect of the reforms was the number of organisations abolished and replaced by – well – a similar number of new organisations. Out went SHAs, PCTs and any number of ALBs. In came NHSE, PHE and CCGs. 

Quite what this alphabet soup means for any particular business will depend upon its portfolio. For example, if you manufacture cancer drugs, then you will have moved from having 151 PCTs to engage with to a single commissioner – NHS England. However, if you market anti-depressants then you will now have to engage with 211 CCG commissioners. 

There are also parts of the system where the pieces may have fallen but they have yet to form a discernible pattern. Commissioning Support Units – designed to house the commissioners displaced from PCTs and not taken on by CCGs – represent a fluid (and seemingly shrinking) part of the landscape. Where commissioning support ends up is an open question and is likely to vary from area to area. Given that many CSUs still house medicines management functions, their potential importance is beyond doubt.

We have also yet to see the full impact of strategic clinical networks and senates. Introduced very much as part of the infamous 'pause' efforts to reassure those concerned about fragmentation and loss of clinical leadership, it is fair to say that many of these organisations are still only just getting going. However, to dismiss their potential impact would be foolhardy. 

Remember, these organisations are not statutory and their development was always likely to lag behind those that are. The old cancer networks are often held up as an example of what can be achieved through clinical leadership and coordination that spans organisational boundaries. Yet cancer networks developed at variable speeds. The new networks may be their successors, but they are not their replicas. The lengthy reform process meant that many of the old networks – which relied on the goodwill that is only possible due to personal relationships – haemorrhaged personnel. It will take some time to replace this and will be challenging to do so given the resource constraints upon them.

Same customers
The structures may have changed, but the actual customers are the same. It is easy to get lost in the alphabet soup, but ultimately it is prescribers that will still make or break your business. Understanding what keeps them awake at night and how to influence their thinking is as important as ever, and remains more important than anything else.

By and large providers have been left untouched by the reforms, which focused on commissioning side reform. However, this is not to say that the pressures on them have not changed and are not greater than before.

New pressures
Of course changes to commissioning also impact upon providers. If your customer changes, then you should change with them. For many hospitals the most significant change will not be the transition from PCTs to CCGs, but instead the advent of one specialised commissioner whose commissioning responsibilities go far beyond those which might have in the past been considered 'specialist'. 

For many hospitals, NHS England is now by far their largest customer. A commissioning decision by an organisation that controls sometimes upwards of 50 per cent of income can make or break your business in a way that PCTs never could. It stands to reason that hospitals will become increasingly responsive to the needs of such a significant customer. If commissioning cannot be a powerful force on provider behaviour in these circumstances, then it never will.

Here comes the inspector
The second force on providers is regulation. If former health secretary Andrew Lansley had a relentless focus on commissioning, then his successor Jeremy Hunt's obsession is regulation. Ofsted might be his model, but the secretary of state should be under no illusions that regulation in healthcare is a more complex, challenging and expensive process. The events of recent years mean that the Care Quality Commission starts from a very low base. Yet the recruitment of high profile and well-respected chief inspectors, together with a new management team, demonstrates how seriously the Department of Heath is taking efforts to strengthen quality regulation.

Anyone who has observed the reaction to the 'Keogh 14' reviews or the early Richards inspections will be under no illusion about the impact that a positive or negative inspection can have on an organisation's fortunes and self-worth. You just have to follow a chief executive or medical director on Twitter to see how seriously preparations for an inspection are taken.

The impact of austerity
There is little doubt that providers will respond to inspection priorities. The challenge will be to ensure that the inspection process provides a balanced reflection of what healthcare actually means.

Both commissioning and regulation have the potential to have a more significant impact on provider (and ultimately prescriber) behaviour. However the overriding pressure on all parts of the system will remain money. The NHS may have fared somewhat better than other parts of the public sector, but increases to funding are at historically low levels. With a service used to historic growth of 4 per cent in real terms (and considerably more in recent years), 0.1 per cent increases will seem like a cut. If they seem like a cut, it is probably because they are. As with any other organisation, the NHS is rarely able to spend every last penny of its budget. Furthermore the £3.8bn allocated to the Integration Fund may be necessary, but it is in fact a transfer of expenditure to social care and therefore a cut in money available to the NHS. Austerity – rather than reform – will be the most powerful driver of behaviour in the NHS.

Top tips for working successfully in the new NHS

  • Know your genuine customers and what is keeping them awake at night
  • Know your customers' customers and help the former understand the latter's priorities
  • Understand how the pressures on the system will shape behaviour and design engagement programmes accordingly 

The political wildcard
Remember that the reforms were meant to take the politics out of the NHS? That was never likely to happen. In a system funded by general taxation of which the electorate is very proud, it is impossible to divorce decisions on health services from politics. 

How will this impact upon your business? The current secretary of state has already proven himself to be interventionist in nature. For better or worse, political whims still matter. The service is continuing to respond to the preferences of its political masters.

It will have hardly escaped your attention that the reforms to health and social care have proven to be noisy and controversial. The Government needs to show it can be trusted with health (after all, this was a key part of decontaminating the Conservative 'brand') and Labour needs to show the opposite is the case.

Labour undoubtedly sees health as one of its strengths. It has retained its historic lead as the 'best party' on the issue but it needs the salience of health (the extent to which people think it is the most significant issue facing the country and will vote accordingly) to rise. Compared to the 1990s, the salience of health is relatively low, with the economy (an issue on which voters perceive Labour to be weaker) still dominating.

So it is in Labour's interests to create or encourage as much noise on the NHS as it can. The Coalition parties will want to keep it quiet. Expect plenty of interventions on both sides.

Three forces
The new world has been created and is beginning to settle down. We have a better idea of which parts of the system are flourishing and what the impact of each might be. Three forces will shape the NHS in 2014 and beyond: new structures; austerity; and politics. Pharma marketers will need to assess how each could impact on their business and design strategies to either magnify or mitigate their impacts.

Article by
Mike Birtwistle, Bill Morgan and Sarah Winstone

founding partners of Incisive Health. Email info@incisivehealth.com

19th March 2014

From: Healthcare

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