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Blair pitch project

Primary care is down for a shake-up and pharma may need to reintroduce itself

opinionOver the summer, when the media was quiet and we were on holiday, Sir Nigel Crisp, permanent secretary at the Department of Health (DoH), slipped out a bombshell on the NHS.

He proposes radical change in primary care land and major change in care and services outside of hospitals. We are going to see a massive cull in the number of PCOs, reducing from around 300 to 100, and the new PCOs will cover far greater populations than is currently the case.

New PCOs will focus on commissioning services for their populations and will be unable, by 2008, to provide community services of any kind. Beneath them there will be locality commissioning based on GP practices.

The Strategic Health Authorities (SHAs) are also in the midst of a cull, from around 20 to 10. Are we witnessing a blast from the past, or something new? Is `locality commissioning' a reinvention of `GP fund- holding'? The new SHAs look suspiciously like the old NHS regions, chopped in 2003, and their staff behave more like civil servants than NHS managers.

The new PCOs look strangely similar to the old district health authorities. With locality commissioning based on GP practices, we could see far greater freedom for GPs to influence the shape of the NHS at local level than was ever the case under fundholding.

The real controversy comes from the proposal that PCOs cannot provide any community services. At the moment they are the major providers of bread-and-butter services; these include district nursing, health visiting, school health, community dentistry, allied health professions like physiotherapy, and much more. They currently employ tens of thousands of staff in the NHS.

If the new PCOs are not able to provide these services, other providers will move in and the government has made clear that this will include the private sector.

The Crisp document heralds a new White Paper for this Autumn and Health Secretary Patricia Hewitt announced at the recent Labour Party conference that these ideas would be up for consultation.

The staggering thing is that the changes were announced by Crisp - but nobody had told the people who chair PCOs, who learnt of this upheaval through the media! Needless to say they were a very unhappy bunch and Hewitt had to meet them in September to placate their anger. By all accounts, it was not a happy do.

I recently had a meeting with five London PCO chief executives who were both bemused and angry. They pointed out that their staff were asking questions about their futures and they simply could not give any answers.

To an NHS that claims to value its people, this approach is pretty disastrous.

The NHS unions, including UNISON and the RCN, are apoplectic. They fear for issues of job security, pension rights, union recognition, salary protection and huge uncertainty and instability. They have written to Hewitt in very blunt terms and will oppose these changes vehemently.

This could be a real flashpoint for industrial relations in the NHS and even some in the normally genteel RCN are talking about strike action.

Getting competitive
To the sceptics, the consultation looks hollow. Although the White Paper is not yet written, the SHAs and current PCOs are moving full steam ahead to bring about the new structures.

Critics demand that this is halted until the White Paper is available, but Blair shows little sign of backing off. His mission is to bring about greater choice and better access for patients. He believes that by opening up locally-based services to real competition, he will improve things more quickly. Breaking the virtual monopoly of PCO provision and allowing many more players into NHS activity will certainly do that. Yet, the risks of chaos relating to the sheer pace of this change must be real.

At the Labour conference, Blair and Hewitt reassured the party faithful that these changes would not compromise the founding principles of the NHS - ie, services would be funded through taxation, free at the point of need and based on need, not the ability to pay.

At the Labour conference, UNISON general secretary, Dave Prentis, led an onslaught on the ideas for greater private sector involvement in the NHS and the leadership of the party was defeated.
Since then, evidence has emerged that many Labour backbenchers, including former health secretary Frank Dobson, consider the vision for the future of primary care to be deeply flawed.

Will Blair see a major revolt on his backbenches when parliament opens? The chances are that he will, on a much-reduced majority. If a sufficient number of Labour rebels - supported by the Lib Dems - kick up a fuss, he could be in murky waters. Either way, large swathes of the NHS are going to live with a lot of uncertainty and will feel like a battleground over the coming months.

Where's the money?
Why the haste? Blair can rightly claim to be spending record amounts on the NHS, with the budget rising to over £100bn by 2008. Taxpayers have paid for this through higher national insurance.

Have they seen a good return on that spend? Blair supporters would ask why so many NHS outfits are in deficit this year, despite increased funding. Others also raise questions about the failure to tackle health inequalities, pointing out that much of the NHS deficit is worse in the relatively well provided south of England.

In short, more deprived populations may effectively be bailing out the wealthier populations.

Blair supporters also know that they have promised voters greater choice, fewer waits and easier access. Waiting times and access have improved, but (some would say) not fast enough. Allowing a wider range of providers to bid for services and bringing in real competition could drive poor public sector providers to improve their game to stay in business.

They also believe that the public will be relaxed about who provides a service - as long as it's free when needed, offers a quick response, is quality assured and offers good value. Blair can rightly argue that all providers in the health sector fall under the inspection remit of the Healthcare Commission, so any provider who wants NHS business will in effect have to play on a level playing field regarding standards and quality. Blair believes the public will back him on these ideas.

Back to the future
For the pharma sector this is going to be a fascinating time - the customer base is going to change yet again! Just when companies thought they had a grip on the PCO map, it is all being thrown into the air once more.

In the recent past, GPs have not been the vital players but by next year, as locality commissioning beds in, the GPs at the vanguard of this new framework are likely to be very powerful players.

Watching the commissioning customer base emerge in each SHA patch will be a crucial task for the sector, and it is likely to move quickly.

Responding to the White Paper will also need consideration. Pharma is a legitimate stakeholder in the NHS. It is perfectly reasonable for companies to take a view on the contents of the White Paper and offer their views on it in response to the consultation process.

Companies need to be thinking now about their capacity to respond to these ideas long before the White Paper is published.

Hand in hand
It is too early to say who will win the arguments in the months ahead, but if Blair wins, we will be set to witness the most profound changes in NHS provision since 1948 when it was founded. These ideas will open up large swathes of services to open competition. Is pharma ready for this potential market?

A large component of community-based services is a chronic disease management programme. There is no reason why a pharmaceutical company with expertise in a particular disease area could not bid to run services in the primary care world of the future.

Equally, pharmaceutical companies could build partnerships with NHS Foundation Trusts, or credible voluntary or private sector partners to bid for contracts, and develop innovative and effective service models that could please patients and the future commissioners.

The possibilities for true partnerships working for the benefit of patients and a reasonable return on investment could be very real in the not too distant future.

Think about it.

The Author
Ray Rowden is a health policy analyst and an associate with the Healthcare Commission

2nd September 2008


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