NHS England’s Long Term Plan, published last month ends with a plea to government to repeal or amend the law to relieve commissioners of the obligation to put services out to competitive tender, and create a legal basis for the proposed “Integrated Care Systems”.
As we noted in our first pilot issue, this appears to have gone down like a lead balloon with ministers, who have not even taken the simple steps open to them to revise or scrap the regulations governing the implementation of Andrew Lansley’s Health and Social Care Act.
The Act itself had to be laboriously pushed through by Tory and Liberal MPs, but the regulations, as secondary legislation, can be changed at the stroke of a ministerial pen.
One of the many unwelcome new developments brought in by the 2012 Act was to establish a role for the CMA (no, not the Country Music Awards, but the Competition and Markets Authority) in scrutinising proposed mergers of hospital trusts to ensure that they did not eliminate competition between trusts and “patient choice” in their immediate area.
The CMA (formerly the Monopolies and Mergers Commission) is most used to dealing with mergers in the private sector – bus companies and supermarkets, etc. They clearly don’t understand the values or the workings of the NHS. But this level of ignorance has not stopped them taking up the cudgels to argue – as few have seriously attempted for the past 7 or 8 years – to argue the case FOR competition between hospitals … and therefore implicitly AGAINST NHS England’s current obsession with “integration” and collaboration.
They have just published an almost impenetrable 52-page report Does Hospital Competition reduce rates of patient harm in the English NHS? It rehashes many of the lame old arguments in favour of competition, and then invents some more, with the aid of some complex mathematical formulae and densely worded arguments, using obscure language and a proliferation of baffling acronyms.
It comes to an apparently astounding conclusion:
“Our main estimate is that a hypothetical future merger between two geographically proximate hospitals would, on average and assuming no offsetting clinical benefits are unlocked by the merger, result in a 41% increase in harm rates.” (emphasis added)
Of course the use of the percentage in this statement is somewhat misleading since the overall mean “harm rate” is calculated at 1.9% of patients suffering harm (page 14). A 41% increase in this would increase the harm rate to 2.7% (i.e. 27 patients per thousand patients treated).
While any avoidable risk to patients must be minimised, many might still regard this as evidence of a relatively safe system. We have, of course no counterfactual estimate of what the harm rate might have been had existing merged hospital trusts not merged.
But if the CMA really thought the findings were as dramatic as they appear to be in this document, surely they should be right now insisting that NHS England drop its plans for integrated care, and all outstanding hospital mergers should be blocked.
Ironically many of the hospital mergers that have been taking place have done so arguing that concentration and centralisation of specialist services was essential to ensure patient safety and safe staffing levels. It will no doubt come as a shock to many trust bosses and commissioners that the CMA has formed such a negative view of the plans they propose.
NHS England chair Lord Prior for example only a few days ago gave a speech to the neoliberal fundamentalists of Reform in which, according to The Times, he argued that “targets, competition and reliance on inspectors” had all led to “a disjointed system and demoralised staff.”
Prior laid the blame at the door of “a series of NHS reforms,” carried through since 1989 by his own Tory political colleagues (and by New Labour from 1997) that had “broken up the health service into autonomous hospitals,” making it “almost impossible” to drive an integrated strategy across the NHS.
“You could not have designed something that had at its heart more dysfunction. It’s truly remarkable.”
Many of us who opposed these changes over the years have argued precisely this same point. Who would have guessed that former Lehman Brothers banker and Conservative Party Chairman Prior would now reject competition (and by implication also privatisation) in the NHS, putting himself at odds with 30 years of government policy?
Now the CMA tells us that the more competition the better, and that integration is a threat to the quality of care.
There are many more questions to be asked about the assumptions made by the CMA. The report was published at the end of January, but appears rooted in a bizarre time warp, relying on ancient data (2013-2015) and rehearsing old arguments seldom heard this decade. It seems committed above all to the New Labour notion of competition as a way to offer patient choice.
New Labour experimented with the establishment of “Independent Sector Treatment Centres” (ISTCs) to deal only with the simplest elective cases: many of these contracts have subsequently ended, but the CMA appears to regard any private hospital treating NHS patients as an ISTC, claiming, without citing any evidence, that “their significance has grown in recent years”.
In fact most of the private providers were not ISTCs but private hospitals. In 2016/17 a total of 217 privately-run for profit and non-profit hospitals and clinics handled a total of just under 550,000 waiting list patients – (8.6% of the total of almost 6.4 million), and treated 431,000 out of 7.1 million day cases (6%).
The private share of elective work is no longer growing. Spending on “independent sector providers” in 2016/17 was just over £9 billion: but the following year this level of spending fell, both in cash terms and as a share of NHS spending.
The CMA notes consolidation of trust numbers through mergers in the late 1990s, but claims “the number has since remained fairly static,” although it does note an “uptick” in numbers considering merger as a result of recent financial pressure on the NHS.
Indeed mergers have continued. In 2014 according to the NAO there were 244 trusts (97 NHS trusts and 147 foundation trusts): but the latest lists show just 227. In 2016, an HSJ article reported that one in three acute hospital trusts were “set to merge, join chains or form alliances”: some of these are still proceeding. In many areas plans are being pushed forward to downgrade services and centralise specialist services, further reducing any possibility of competition.
Yet the CMA still talks about hospitals competing to attract more patients (p7) glibly suggesting that capacity constraints, sky high levels of occupancy of available beds, and staff shortages that bedevil so many NHS trusts can easily be addressed by “reducing length of stay and managing beds more effectively, by investing or by innovating”.
To confirm how out of touch they are, the CMA report adds outdated statistics – from a bygone age before the current financial pressures and bed shortages: “over 92% of patients … were seen within the 18 week referral to treatment target between March 2012 and March 2015.” (emphasis added)
Today’s situation is very different. The referral-to-treatment target has not been met since February 2016, and the proportion of people waiting over 18 weeks to start elective treatment reached 13.4% in December 2018 – the worst level of performance since January 2009. Hospital trusts are in no position to compete for extra patients: they are struggling to handle the workload they have.
The CMA then throws in page after page of highly technical and statistical calculations – all based on just 2 years of data (2013/14 and 2014/15). The calculations relate to that period, rather than now. The CMA appear blissfully unaware that since 2016, with the development of Sustainability and Transformation Plans the main debate has moved on: competition is yesterday’s big idea.
The CMA’s whole approach is based on outdated theories and assumptions rather than current reality. Perhaps that’s why it has published the report but coupled it with any announcement it will ban any future mergers to avoid the 41% increase in rates of harm to patients.
Tempting though it may be for some campaigners to invoke the CMA’s warnings of potential harm from hospital mergers, it’s best to steer well clear of this ill-conceived and deeply flawed report that has proved the irrelevance and ideological preoccupation of the CMA, and shown why it can never be a useful ally for those fighting for NHS values.
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