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Industry accountability for public contracts. (Photo credit: Ron Knox 2001)

I was watching the Public Accounts Committee on 23 May 2011 take evidence from IT suppliers and NHS executives on the NHS IT contracts. This monstrous contract was doomed from the start, yet few seemed to be in a position of influence to alter the ‘group think’ that prevailed in government. Civil servants and ministers seemed to breath each other’s air as they pursued this pig in a poke. Worringly, the PAC exchanges shed a bit of light but more revealing was the lack of common language amongst those concerned. Frequently, answers were not relevant to the question, used jargon or introduced further obfuscation.

In the end, whether supplier or NHS exec, the PAC was faced with a sea of denial, avoidance, or sheer hubris. I say hubris as NHS executives in particular were at pains to avoid rocking their own boat by being completely candid about things, preferring warm phrases that all was well, despite the CEO of the NHS being unable to answer many questions clearly, and seemed painfully ill-informed of his brief.

Evidence of obfuscation abounded as the MPs had to ask suppliers many times to answer with yes/no to what were straightforward questions. I was impressed with the efforts of some MPs (Bacon in particular) to get clear answers to important questions.  As a rule, complex answers betray a lack of understanding of the underlying logic — there are simple answers to these questions, not ‘it depends’ or ‘you’re comparing apples and oranges, pears’; indeed, at one point, the sessions seemed more about the comparative merits of different fruits than IT procurement. As well, the lack of clarity of underlying logic also evidences people were unable to agree on what the core problems were.  Now, granted for some this is likely to be a complex problem (in the technical sense of the word, a wicked problem), but I doubt that — the NHS’s needs and responsibilities are complex, but an electronic health record is a thing, with a defined functionality.

I remember sitting in a room just as this NHS IT for heatlhwas being firmed up (2002), and hearing the Director (Granger) at the time speak glowingly of the benefits. Upon hearing this, others in the international teleconference asked, “surely you’re not serious about doing this”, to be told, “absolutely”. As is said, act in haste, repent at leisure.

An important question was, knowing what we know today, was the original decision to proceed with this central and top-down approach sensible? The answers were evasive and broadly technically wrong. In 2002, it was perfectly possible to develop distributed systems, with broadly distributed functionality using various systems integration options to enable diverse technical architectures to co-exist to deliver uniform service. No one wanted to think that way for a couple of reasons. The first is ego: grand plans appeal to people’s ego needs, to be in charge of something big. The Director at the time exhibited serious Machiavellian behaviours, and failed miserably to engage users.  The second is conceptual: at the time, Department of Health and NHS executives were still thinking the NHS was a single lumpen thing that needed single solutions to its complex problems. In the early 2000s and late 1990s, that the NHS should be seen as a complex adaptive system was understood, but not acknowledged as it flew in the face of prevailing ideology about central control, driven by the mistaken (technical) belief that a distributed system, while diverse and pluralistic, would be unable to deliver a common standard of performance.

In the end, you end up with a system that is rigid, technically obsolete as soon as it starts operating and because it fails to evolve with changing clinical needs, which will change as clinicians become familiar with the technology and comfortable with its use, and start to specify more sophisticated applications. That some PAC evidence said that clinician need had evolved is nonsense — we know then that these were the core needs. Anyway, we’re moving on to smartphone apps, and there is little evidence that the system can accommodate the wireless world of healthcare. The best selling clinical app is ePocrates, for drug information. How many clinicians have that app? How many clinicians are using smartphones? Distributed and simple systems can deliver often quite complex solutions; for instance, the Danish electronic prescribing system was built on simple secure emails.

The approach that was ignored at the time was this:

  1. specify common standards of interconnectivity and functionality, that is results;
  2. allow providers to use whatever system they wished as long as it met these requirements;
  3. allow the system to evolve over time as needs become better understood;
  4. start with the patients who are heavy users (high risk/high utilisation) and roll out from there.

That’s it.

Where the English NHS and Department also lost the plot was failing to exploit the NHS IT project to drive innovation into the IT sector to encourage the formation of a potentially world-class health IT industry in the UK. Is it any coincidence that the main solutions are from outside the UK and the critical supplier expertise betrayed North American origins?

This is a real shame, as once again the Department has shown antipathy toward enabling a commercially successful and innovative health supplier industry, in favour of mean-spirited control. This was perhaps the greatest missed opportunity, as instead, the Department came up with false logic of needing suppliers of scale (who are now quasi-monopolists).  Indeed, one member of the PAC did question whether CSC’s corporate logic was to make itself a monopoly supplier to the NHS.

The tragedy, too, is that virtually all the functionality that the NHS needs can be downloaded for free in the form of open source software.

Finally, the best thing the NHS and the Department could do is make sure all that intellectual property that has accumulated is given away, to try again to jump-start a health IT industry. If there is a value-for-money lesson the PAC could draw it is to determine whether there is sufficient residual value in the NHS IT procurement to be translated into investment in the economy, to build new suppliers to the NHS and perhaps the world. An opportunity awaits.

UPDATE

I thought I’d add reference to this diagram on distributed clinical systems. The copyright dates from 2002, a time when the PAC was told such capability didn’t exist. The diagram is taken from the OpenEHR website, which adds “Much of the current openEHR thinking on distributed computing environments in health is based on the excellent previous works of the (then) OMG Corbamed taskforce, and the Distributed Healthcare Environment (DHE) work done in Europe in EU-funded projects such as RICHE and EDITH, and the HANSA and PICNIC implementation projects.”  In those days, the UK’s NHS was still charting a proprietary, and non-standard, approach to EHRs and clinical systems; an example of one failed programme is the ‘common basic specification’ — there is an interesting commentary here on some reasons why it failed.

 

Diagram of a distributed clinical system, ca 2002

 

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300 The Movie

Health Politics (Photo credit: Quang Minh (YILKA))

The NHS Confederation wants it all to stop, according to journalist reporting in the press (for example, here).

Over the years, there has always been this fear of the words NHS and political football being in the same sentence. Perhaps the better approach for both the government and the NHS would be for the NHS to more explicitly engage in the political debate.

Mike Farrar, the new head of the NHS Confederation (which seems to have its own problems), says that the system is a democracy. Yes, but what does that mean? It should mean empowered to participate in the machinery of democracy and political debate, and not just take orders.

By explictly engaging in the political debate, NHS actors would widen the marketplace in ideas that the political space needs to chart the future direction for the NHS. This would create greater political space between the NHS (whatever that actually means these days), the civil servants in the Department of Health, and the political machinery of government. At least at a public level, NHS actors have avoided the political dimension, thinking it a better strategy not to become ensnared in the politics. But of course, their political debates are more likely to be argued through responses to government consultation documents, presentations to the Health Commmittee, exchanges at professional conferences (but this is frequently a one-way dialogue), and closed door meetings. They are all generally well-behaved, articulate and ineffective, but importantly not engaging citizen preferences.

This stance may be past it usefulness, especially if the providers of care are supposed to really engage with their local communities.

The purchasing side of the equation is equally fraught with avoidance of too much public engagement and as a consequence, purchasers (I do like that word), seem destined for provider capture, and the protection of legacy provision (mainly to avoid any hint of private sector participation). Hardly a reform agenda. The new Agences Regionales de Sante in France may actually show how this should be done, but again that is another story. Major reform is not just a UK thing.

Providers have weak public affairs capabilities, little political nous, and less ability to galvanise public understanding of the options facing providers. They, too, may be subject to capture by their own professional staff, so disruptive changes are avoided to keep the peace.  Foundation Trusts may not exercise their autonomy well, perhaps discomfited with the notion of too much autonomy generating an unfavourable press.

Anyway, one benefit of greater engagement in the political arena would be to shift the logic internally from the NHS being a policy-taker, waiting for the politicians to decide what to do, to becoming a more active participant in the marketplace of ideas for the healthcare, in effect a policy-giver. As such, the NHS, taken together, has virtually no political capacity, no capacity to develop structural options, no formal relationship with the public to seek their views on this or that.

All this has been handled by the Department of Health which sets the tone for the political debate and defines what is and isn’t in the frame from a reform perspective. This serves the Department just fine, as it furthers the role of the Department of Health as being responsible for the publicly funded health system, which is not a bad thing given how much public money it consumes. But it also means that the Department is the only one framing the political debate, and that is not particularly good for democracy. And not all political positions need to be played out in the Commons, but can be debated vigourously in the real world as NHS organisations drive forward changes. Keeping NHS organisations on a short lead only means more work for the Department of Health, but less value being derived from all the people running hospitals and clinics.  It is time to replace notions of the NHS as a single ‘thing’, like supertanker which takes forever to change, with the concept of a school of fish, which can change direction really easily and quickly.  See my blog post on distributed systems in health care here.

But arguments are what they get because the object of their affections has weak autonomous and collective decision-making structures, and a cognitive capacity to engage in the arena of ideas except through special interest groups such as the health professions or Royal Colleges, or the Confed. These do not represent the interests of the provider side of the NHS, but only their interpretation of these interests through their own lens on the NHS.

The Confed is not sufficiently robust to act in a political capacity in this arena despite publishing various position papers and having a lobby office in Brussels (funded I believe in part by the soon to depart Strategic Health Authorities), and attracting high-profile people, all of which are worthy.  But the Confed is shot through with conflict of interest problems and may not be certain what its role is — time will tell.

Mr Farrar speaks in this article of a ‘public interest test’, for example. Well, the challenge for NHS structures is simply to introduce it as a matter of managerial autonomy and good practice. If it is such a good idea, why wait for the government to make up its mind. With all the smart people supposedly thinking grand thoughts about the future of the NHS, would it be too much to expect someone to be courageous enough simply to get on with putting these ideas into practice, to test them out.

It would also nicely balance the political realm, as the NHS actors would be demonstrating their ability to get on their job of managing the healthcare system with innovative approaches, without legislative intervention.

The problem as always is courage.

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Sticker advocating dissent: "dissent deve...

Something autocratic leaders don't understand

Another day, another perspective. The Guardian reports that another member of the select few advising the PM, Cameron, on health reform has been a bit off-message. It just goes to show that the people who held positions of power and authority in and around the NHS, when removed from that public duty, may just hold somewhat different views from they professed to hold. Did Mark Britnell think this way when we worked in the public sector? If so, why so silent?

Of course, part of the problem is the general lack of alternative perspectives within the NHS and the Department of Health, driven by the need to maintain a tight control on dissent (bad for decision-making). There is a somewhat natural and regretable tendency that when governments get into trouble, they behave like authoritarians, meaning they move to suppress dissent. Of course, the result is that they also legislate, or act in haste, and then repent at leisure, often courtesy of the courts, as decisions are progressively unpicked.

Britnell said things to please his audience, hardly unguarded, but certainly counched in language familar to Americans. Having chaired a conference on how to export American healthcare expertise to Europe, it is easy to get drawn into thinking that all things are possible when talking with Americans, something that folks familiar with the NHS would find seductive for its novelty.

Let’s look at what Britnell might have meant. There is nothing strange for the NHS to be a state insurer, since that is what it in effect is. Why were the premiums called ‘National Insurance’ anyway. The term insurance is also more easily understood in the US, and it more familar to those within the EU, as well. Perhaps the problem lies more in these shores, at not understanding the need to ‘translate’ language so people in fact can understand you. But then fog in channel, England cut off.

The NHS is highly politically polarising in the US; it is associated with rationing, queuing, and at least to many on one health discussion group, poor clinical outcomes. So the evidence, from the US side, is the NHS is not something to copy. The Canadian system is also highly politically polarising. Neither system particularly fascinates Amercians anymore, they are much more interested in the Netherlands. So it is with some courage that Britnell talked about the NHS in the first place — into the lion’s den and all that.

Would it be such a bad thing for the health system to thought more like an insurance system? Probably not. There is some evidence, controversial to some, that Bismarckian systems (i.e. insurance-based health systems), are more productive, easier to incentivise and provide better care than Beveridgean (i.e. the NHS, tax funded) systems, which are seen as better at managing costs. When Bismarckian systems get into financial trouble, they adopt centralised or other control systems familar to tax funded systems (cue recent reforms in France or Germany), while tax funded systems when they need to improve outcomes, shift toward insurance-type approaches, cue managed care, co-payments, clinical carve-outs (disease or medicines management) and so on.

The one big issue, hospital autonomy, or state ownership, is largely a non-starter if you really think about it. There is really no need for the public sector to own the means of production (i.e. the organisations that delivery health services), unless one is an unreformed Marxist. The NHS is probably better thought of as a guarantor of quality, access, and the purchaser of the care itself, something more akin to what proactive insurers should be doing. What appears to be interesting results from the last decades of reform is that public ownership of hospitals apparently concealed poor management, weak financial controls, convoluted clinical workflow, all of which led to poor productivity and value-for-money. These types of problems are not fixed by simply throwing more public money at them, but by changing the way they operate, the incentives that drive organisational behaviour. If you want to reduce emergency 7-day readmission rates (where most of the problems really lie, not at 30 days), some disincentives are appropriate, otherwise people don’t pay attention. A type of tough love.

One good thing is there is some possibility that this closet advisory group may not be breathing each other’s air, and that some original thinking may actually be taking place. However, I remain doubtful, since the people involved built their reputations within the very system they are now being asked to reflect upon. If they were that good at thinking this way, why weren’t they doing it before? Perhaps they were too obediant and on-message.

Regretfully, this mantra appears to be more important than the problem of NHS reform.

Herd mentality

Better this than trying something new

Steve Field was asked to lead the collective rethink by another group of vested interests of proposed NHS reform.  He apparently thinks, according to the Guardian, that the English NHS reforms are not workable. Apart from the rather pointless delay in getting on with reform, in the patient’s interest, rather than the interest of providers, he overstates the challenges faced by competition.

There is a general fear of what is called ‘creative destruction’ being applied to public institutions. But governments for years (think back to Thatcher, Blair) have tried to reform Whitehall, trim the scale of the public sector, and bring needed new thinking — the New Synthesis project is one example of people trying to rethink the public domain. Most of the changes in the NHS over the past two decades have been clearly in this direction, but regretfully, the Coalition failed to signal that they were tidying things up — who suggested all this needed primary legislation anyway as the SoS has enough power to do this anyway.  The push-back from entrenched public institutions can be unnerving to governments, in particular Coalitions, who need to keep their political dance partners happy.

So what to make of the comments in this interview:

  1. Head to head competition is unlikely across the bulk of England as integrated Foundation Trusts tend to be the sole and dominant provider in their areas. Major cities are the exception and the high operating costs, difficulty accessing services, and duplication of services is something that needs to be dealt with through targetted commissioning. Failure to do the hard bits will simply drive costs further skyward, and reward failure.
  2. There already is competition with the private hospitals, but they have their own interests, and launching a major assault on the NHS would be largely pointless — their customers are NHS consultants who provide their services to people who have taken out private insurance in order to opt-out of the NHS.
  3. So-called cherry picking is not a bad thing — aggregating similar cases in specialist units is clinically sensible as it produces better outcomes. Now why has the NHS resisted this sort of service rationalisation? If NHS providers are unable to sort out their clinical priorities they why shouldn’t a new entrant offer this service if they can do it better? I reviewed two hospitals once that duplicated services, and seemed unable to provide a single service between them. Outcomes weren’t good either.
  4. The ‘rules’ the Department of Health works with have rigged the market anyway in favour of incumbent NHS providers, whether they are providing a high quality service or not. There is real fear here in Government, but the patients’ priorities for a high quality service they can value may be more important than ideological considerations.  Perhaps we have to wait for the Facebook generation to start consuming health services for the mandarins to ‘get it’.
  5. Unbundling hospitals is something that can be done, but understanding the complex interaction of hospital-based services also needs to take account of the general shift toward out-patient services and increased focus on primary care, meaning hospitals aren’t going out of business soon, anyway. Field is right to point to shroud-waving, but misses the point that it was this shroud-waving that caused the panic in the Coalition.
  6. He uses the term ‘free market’ when in fact it won’t be, it will be a regulated market as there are very few free markets anyway (including in the US where there isn’t really a free market in their largely publicly/federally funded system of not-for-profits and loss-making hospital chains — try getting care from an HMO that you aren’t a member of).  The only existing health market regulator in the Netherlands seems to be managing just fine.
  7. Other countries have forms of competition between hospitals (France, Germany, Netherlands, Belgium, Spain, golly, this list could go on and on) and their systems haven’t crashed into some incomprensible quagmire of service chaos. Field overstates the problems, but it may betray some degree of fear that competition will unearth further underlying challenges that provider managers may be ill-equiped to deal with. There are some incredibly well-run hospitals in countries like the Netherlands, France, Switerland, Sweden, Belgium, not to ignore some of the best US hospitals but training in hospital management in the UK is not to world standards.
  8. That some NHS hospitals are badly run seems apparent, and something needs to be done about that, so removing motivation for an executive focus on financial and service performance seems a bad idea, at least to those who would be faced with the job of actually managing a hospital, and not just taking up office space.
  9. You don’t go out to tender for a trauma centre, as you need a catchment population in the millions to justify the necessary skills. Commissioners who don’t understand this shouldn’t be allowed anywhere near the NHS.
  10. There are examples where novel solutions to challenges have been inspired, my favourite being the establishment of five world-class academic health science centres; all we need now is for them to assume a leadership role in driving excellence in management and patient care through the wider system.

I find it interesting that those who have the greatest stake in maintaining the status quo are those who are leading the listening exercise; why didn’t the Department of Health select perhaps an international panel or empanel a group of people with alternative perspectives? The vested interests run deep in the corridors of power.

As for some of the pending conclusions:

  1. no problem reserving a spot for nurses, but what about pharmacists, occupational therapists, and a host of others? Oh dear, patients and users?
  2. why hospital doctors on commissioning bodies; aren’t they part of the system that most would keep services in hospitals. There is serious risk of provider capture here. Including them because they might feel alienated is plain silly. The most alienated part of the NHS is the patient.
  3. inclusiveness is running mad here, and would make any ‘clinical cabinets’ virtually unworkable — when will they all have their group hug? I think it will just make work for consultants in organisational dynamics, who will be needed to help develop them, and keep them from constant bickering. The NHS spends too much time worrying about emotional intelligence of managers and whether their leaders are getting enough cheese. The proof is in the pudding and the leaders aren’t leading.
  4. GPs can acquire skills to commission anything they like, and to say otherwise is insulting and perhaps other words might be more applicable.  This is a lame excuse, otherwise we would never get anybody doing anything because one could always argue that they don’t know what they are doing and someone else could do a better job. The NHS Commissioning Board isn’t needed; it is just the continuing felt need for ‘national’ bodies and will hoard expertise that should be distributed around the system, to avoid the problem Field thinks exists.
  5. I doubt plans to reform medical or other professional education will be affected. This the job of the universities anyway, and they should get on with the job regardless. If that were true, then the NHS has colonised the education field inappropriately.
  6. The levy on private hospitals is unworkable. Half of nutritionists don’t work in the NHS — should Waitrose pay for the nutritionists they employ, should self-employed physiotherapists reimburse the NHS, and what about the 25% of nurses that work in the private sector.

What is clear is that listening exercise has beneficially galvanised those who didn’t have a problem with reforms to point out that this is now delaying essential service innovation — not the NHS innovates at the drop of a hat! France recently reformed its system. Anyone notice. Quick and likely to be quite effective.

I look forward to their final report, to see what changes I need to make in my comments above.

 

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Surpluses (and deadweight loss) created by a m...

If only it were that simple!

The current debate in the UK, specifically England, on reforms of the publicly funded health service have raised the red-flag of privatisation. Hostility has centred in the main on private firms offering health services and the scope and meaning of ‘any willing provider’.  Signals from politicians are confusing given they are walzing back and forth across the dancefloor depending on criticisms. Indeed, there appears to be some risk that dance partners may change, as the Lambs, for instance, change sides to avoid slaughter in the arena of public opinion. Such self-interested face-saving aside, is there an issue to answer here?

Article 106(2) TFEU as a general interest exception: which involves invoking public interest grounds, specifically, “undertakings entrusted with the operation of services of general economic interest … shall be subject to the rules contained in this Treaty … in so far as they application of such rules does not obstruct the performance … of the particular task assigned to them. The development of trade must not be affected to such an extent as would be contrary to the needs of the Community.” [Community here referring the EU, not the local community.]

In operationalising competition arrangements, the EU approach is built on simple foundations, of equal treatment, and that firms given special treatment cannot also be protected through public measures which favour them.  There has always been some debate about public monopolies and what has been called ’emanations of the state’, and through it all a recognition that state organisations are deemed to have a dominant position that they cannot abuse — perhaps more importantly, state organisations delivering a service cannot be protected by the government engaging in abusive market practices simply to protect them. It is certainly an abuse for a government to create a monopoly that cannot deliver the services required.

From an EU perspective, can states create a monopoly situation simply because they want to avoid competition in a particular area of the economy? Well, presumably yes, if it is of general economic interest, and if the prohibition of competition is necessary for the resulting bodies to do their job.

The ‘get-out’ clause is whether restriction on competition is necessary for the NHS to do its job. What is the job of the NHS?

If it is to procure health services from any “qualified” provider, then it is a procurement body and restrictions on competition would not be appropriate as this might lead to contracting for services from a subset of qualified providers who would be preferred on other than a level playing field — that public and private firms compete on an equal basis. The interesting question underlying the assumption is also that there would be market failure otherwise. But one test of market failure is that there are no providers willing to enter the market. But an any provider situation presupposes that isn’t true, that firms would enter the market and provide health services. So prohibiting competition effectively partitions the market in favour of public providers and that doesn’t seem to sit with the general EU competition tests. There is a subtle change in terminology that may be political but may be important (hah!): between any willing provider and any qualified provider — being willing isn’t enough, being qualified is, but can the determination of being qualified act to restrict access to the provision of health services, as being qualified may preclude organisations that might provide care, i.e. they are willing, but currently aren’t.  A bit like the only way to learn glass is fragile is to break it, the only way to find out if an organisation is qualified is to let it offer services. Of course, with an onus on qualified, there could be a presumption in favour of legacy providers, as obviously they are willing and qualified. (How many angels was that again?)

Does the EU treaty permit monopolists to abuse their dominant position by providing a service to a level less than is needed? In other words, can the purchasers purchase in such a way as to ignore lower cost/higher service level providers in order to protect the legacy NHS providers? Not really, as that violates the simple test of neutrality with respect to ownership status under competition law.

Granted that the purchasers could argue that financial controls are necessary as not everything would be affordable for everyone all at once, but the ECJ healthcare rulings have established a base line test: would the person involved eventually get treated? Saying ‘no’ is not an option for a state monopoly health service as that is called rationing and the ECJ has ruled that such decisions must be made on the basis of international clinical evidence, not administrative niceties.

So we are left with the question whether the prohibition of competition is necessary for the NHS to provide care. This is where it is necessary to decide whether the providers of health services in England are really state-owned entities, or simply contracted-in subcontractors. GPs in England have always been private businesses, though they have badged themselves as within the NHS since 1948, unlike community pharmacies, who similarly have virtually monopolistic contracts with the government, but are more readily perceived as not part of the NHS. It seems that as soon as you create a distinction between the delivery of services from the purchase of those services, you create the basic conditions for a market, for contestability, and by definition have eliminated the applicability of the market failure argument.  So the NHS delivers services of general economic interest, but it is not necessary for the delivery of that service to prohibit competition.

That means that the competition rules apply.

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Cork

There's a reason the French call a traffic jam, 'bouchon" or cork.

The English NHS is in such a confused process of change that its CEO, David Nicholson wrote a letter of clarification to ‘everyone’ on 17 February 2011.

In this letter he sets out key challenges and issues. My mind for a moment flashed to autocrats championing their own view of the world, as though one were speaking to children. I have said often enough that the NHS has to learn to be an adult organisation. It doesn’t help with letters from ‘daddy’.

But something in this letter caught my eye, on page 5: “Support consortia to achieve authorisation, and will operate a rules-based intervention
regime to ensure consortia remain fit for purpose”. This is very interesting considering the underlying complexity of healthcare and being ‘fit for purpose’ might work for a toaster, but organisations don’t work like this in quite the way this linear mode of thinking suggests. It is worth keeping in mind that the fit-for-purpose mantra has been around in the public sector in the UK for quite some time, and yet the taxpayer continues to fund many dysfunctional organisations. So it is hardly a decisive criterion that organisational survival might depend on.

There is an active debate between rules-based and principles-based regulatory processes, and for a good reason, one of which had to do with the recent crisis in financial markets. What are these two?

  • Principles-based regulation focuses on outcomes, rather than processes.
  • Rules-based regulation requires the regulator to foresee every possible area of activity. This is often characterised as ‘tick box’ regulation.

In comparison to principles, the rules-based approach removes considerable discretion in behaviour, and to some extent simplifies the oversight process as you pay less attention to outcomes.

Let’s consider an example from something I did once. In the regulation of nursing homes, a document of over 60 pages of detailed inspection standards was prepared by an academic group (no surprise there, I guess): this is a set of rules.  What was missing was any statement of what purpose these inspection standards served; this document was silent on outcomes nursing home care should achieve.  So we had lots of rules on inputs and processes and nothing on outcomes (Donabedian would hardly approve). With a group of people, I helped them replace this 60-odd-page document with a single sheet of paper with 5 outcome criteria against which nursing home care could be assessed. These are principles.

The difference between the two can be looked at from a human perspective. If I work in a nursing home, do I carry around in my head 60 pages of inspection standards? No. I am trying to manage care processes. Could, instead, I carry around in my head 5 quality outcome criteria? Most likely.

Since we are talking of processes managed by humans, human frailty needs to be taken into account, and outcomes are a better guide to personal conduct than 60 pages.

I am now worried that an intrusive, pedantic system of compliance management is being put in place which will frustrate clinical service staff, drive management  crazy, and in the end probably provide far too many sources of tension between the two, to say nothing of the regulatory and inspection overhang from the NHS executive suite which will simply get in the way. It is just a useful reminder that the greatest barrier to change lies at the top — that why we say that the bottleneck is at the top of the bottle.

Anyway, healthcare is sufficiently complex that we can’t really create sensible rules.  I wonder why people keep acting as though this weren’t true.

One step forward, at least two back.

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M16 The Eagle Nebula

The truth is out there

So things are heating up in the English NHS. Reforms are rushed, reckless, at a time of crisis, many are warning. Is that strictly true? Reform to those who have to implement it can always seem rushed, especially when driven by a reforming coalition government and a mounting debt burden. The past, oh, say 20 years, have not been easy for the NHS, but what is becoming evident is that a reforming mindset has not set in.

What do I mean by a reforming mindset? I mean a willingness for clinicians, managers and all the other staff to engage with the challenge of improving the quality of the healthcare patients receive — indeed, of justifying the public expenditure by providing a service that patients and the taxpayers more generally will value and use with confidence. With an obviously too broad a brush, this means that opportunities to innovate are missed, opportunities to try something new are avoided. It means that the ‘top’ has failed to manage, preferring perhaps to be stewards of their NHS organisations, adopting an inclusive approach that avoids confrontation, never upsets a particular stakeholder group too much, and in general avoids making waves. Apart from the day-to-day challenges of clinicians, we see, despite the McKinsey report on managerial excellence, weak strategic execution. Now the chips are down, decisions need to be made that will upset people — see my earlier post on shroud-waving. Each profession seems to be taking turns highlighting how their specific interests will be threatened.

Rather than coming forward with innovative and creative solutions, minds are retreating into denial and avoidance of the challenges ahead.

As any regular reader of this blog will know, I quite like disruptive innovations. Healthcare hasn’t had much of it really, just a sustained litany of top down reform pressure, but the real reforms, which need to come from those who are in daily contact with patients cannot be best served by organisations parachuted in to ‘encourage innovation’. This has to be embedded in people’s daily approach to work. Having run an internal consultancy in a very big academic health science centre, I appreciate the fundamental importance of using internal capabilities and building internal capacity.

But what might act as an incentive? We now know that being publicly owned and funded does not guarantee that organisations will be kind and caring toward patients. There are just too many instances where NHS or social care organisations have been able to abuse the public’s trust behind a veil of public ownership. The challenge facing Monitor and the Care Quality Commission isn’t just to regulate, but to disinfect.

My thoughts, though, turn to patients as a force for change. I have always felt that patient involvement is the most disruptive force in healthcare, and we have had years of this or that programme to engage patients in their healthcare to uneven effect. The one thing, though, that might actually make a difference would be to introduce a substantial co-payment which patients would pay, as part of the funding of the system. Now, the health economists will jump up here and call such a proposal a ‘policy zombie’, a term for an idea that should stay dead. However, co-payments are used in such advanced health systems as France and Spain.  Indeed, I think the best thing the NHS could learn from these other systems is the use of co-payments to align patients’ and clinicians’ interests. The old adage ‘fog in Channel, Europe cut off’, can also mean that good ideas ‘out there’ never get ‘in here’. If you don’t look, you don’t see, and won’t find.

Paying for this is offers an interesting option. A huge amount of money is raised every year through National Insurance ‘tax’, which is a broadly hypothecated (but regressive) tax for health, social care, unemployment, that sort of thing; its original purpose as a form of ‘insurance’ has now been lost. In 2007-8 it raised some £98 billion.  My proposal is this. Abolish NI and return the money to individual taxpayers and employers. In turn, individuals will use this money for a variety of purposes such as the healthcare co-payment, investing in pensions, funding ‘retirement’ social care insurance, and probably a lot of other things I can’t think of, and which are currently paid for out of public coffers — isn’t one issue facing the coalition government how to shrink the public side of the balance sheet and shift funds into spending from individuals based on choice?

The NHS funding side looks like this. Over the next few years, the NHS has to find around £20 bn of its current £110 bn or so annual cost as savings.  The NHS continues to make these savings. In time, annual NHS spend (ceteris paribus) of around £90 bn would now be composed of £70 bn in central state funding and £20 bn in income from patient co-payments. The effect of this is liberating more generally, but achieves an important social benefit as it broadly aligns the interests of all parties, and engages patients in the actual cost of their healthcare — a tax-funded system with no co-payment insulates patients from the financial consequences of their healthcare decisions. Of course, I know that some design features are needed to take account of people with no income, fraud, and so on, but nothing that is a deal-breaker as other countries have managed this so presumably it can be done.

Removing probably the bulk of NI income from the public revenues has enormous consequences, and it does require comparable reinvestment in those services currently funded by the NI system, but by individual taxpayers instead. Most of the discussion on the abolition of NI has focused on the government continuing to be responsible for the items NI pays for (e.g. the apparent position of the Institute of Directors in the UK). My proposal shifts this burden entirely to an insurance model and has the effect of shrinking the state by building up individuals — goodness, a big society.

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