Commissioning a Patient Led NHS
(Published October 2005)

Commissioning a Patient Led NHS by Michael Sobanja

Another NHS Reorganisation was launched by the publication of the Departmental guidance issued on 28 July 2005 entitled ?Commissioning a Patient Led NHS?. The expected reconfiguration of Primary Care Trusts is now under way, with proposals to be submitted by Strategic Health Authorities by 15 October, but there were also a few surprises in the notably the separation of commissioning and providing at PCT level (see below). But what are we to make of this, and what are the implications for the pharmaceutical industry?

The first comment I would make is that this is one of the new breed of letters from the Department of Health (DH) that is short and to the point. We have become accustomed to the long, rambling type of guidance and I think the new shorter versions are to be preferred. Some do not ? where is the detail they ask, what about x or y? I think they miss the point ? if we want a DH that?s sets the direction of travel after shifting the balance of power then keep it brief ? take responsibility at the front line and develop this policy in a way that suits local needs and circumstances. Asking the DH to provide yet more guidance only encourages micro-management and should be avoided. It does mean that we have to take the principles and put some meat on the bones ourselves ? both in the NHS and outside.

Turning to the content, the following are the main proposals:

? Merger of PCTs ? probably down to something like 100 ? 150 with role of both strategic commissioner and performance manager ? welcome back District Health Authorities some would say, but this interpretation would fail to recognise the new bodies will have different roles in both ?holding the ring? and supporting practice based commissioning in the future. Indeed, if the new PCTs turn out to be old DHAs then the objective of this change will have been missed.

? The 28 Strategic Health Authorities to be reduced to about nine ? probably to match the existing Government office of the Regions. Curiously, the SHAs to continue ? but for how long? ? I wouldn?t mind putting money on their being adsorbed into the Government Offices for the Regions in the next five years.

? Practice Based Commissioning (PBC) to be 100% implemented by the end of 2006. Of course, there is some ambiguity about the definition of PBC and therefore this could be easy or hard to achieve ? and at the moment the DH won?t come clean about whether they mean real budget holding or simply information provision to a practice level. At its most extreme ? the full delegation and control of budgets to practices seems impossible to achieve and we might all expect the target to be interpreted in a less demanding way.

? PCTs to lose their provider functions by 2008. Currently some PCTs are big employers, running not only community services but also some hospitals. These services are to be separated off into new bodies (the re-emergence or community trusts?) or even the private sector. In any event, community services are to be subject to contestability which in reality means market testing. Welcome back to the internal market ? or not perhaps? This has produced perhaps the most widespread reaction with some saying that the separation of commissioner and provider functions at PCT ? but not Practice, level is intellectually incoherent. In reality ? this is about focussing PCTs on their main task ? and in any event, separation of commissioning and provision becomes increasingly nonsensical the nearer the patient the organisation is. Perhaps we should focus on what works and not intellectual neatness.

? All NHS Trusts to move to Foundation status by 2008

? Ambulance trusts to be reduced considerably ? subsequently proposals have been produced which will result in the creation of 11 merged ambulance trusts

The real driver in all of this is to make a reality of commissioning which has hardly delivered the goods after nearly fifteen years on from being introduced into the NHS lexicon. It is about time we ended provider capture, focussed on what patients and populations need and enabled commissioners to lead the NHS. The rest then follows ? and is consistent with the previous policy and results in a full-blown market for the NHS ? and I would predict that primary care is next. We shall wait for the White Paper?

Thinking about the Pharmaceutical Industry, the implications are now pretty clear in the short term, but the shake down will take some time to settle in the new customer environment. Those implications include:

? A customer environment that becomes increasingly inward looking in the short term, with individuals concern being set on personal survival. Access from, attention to, external organisations will become more difficult.

? In the longer term, the fragmentation of commissioning presents a real challenge to those who seek to influence them ? more and new customers with the potential for different requirements and policies.

? More and different types of providers, with a variety of traditional NHS and independent sector providers ? more difficult to treat as a single customer. The ability of the pharmaceutical company to enter the market as a service provider may present real opportunity.

? With greater specification of services will become more standardisation of treatment and prescribing. Great if you have an ?approved? product ? but pretty limiting if you don't.

? A customer environment which becomes more focussed on costs ? driven by tariffs and legally binding contracts with real competition. As pressure on costs bite ? some providers will go to the wall: others will increasingly look to pressurise their cost base ? including prescribing costs ? to survive.

? An increasing opportunity for the industry to bring offereings to customers that build upon their own expertise of business and business models ? information handling, supply chain management, performance management and so on ? the NHS is going to be hungry for those techniques which it has (often) previously ignored.

? A need to stay in touch with a rapidly changing environment over the next few years ? the need for customer market information and understanding has never been greater.

Here we go again?

Michael Sobanja is the Chief Executive of the NHS Alliance and a Non Executive Director of Health Direction Ltd

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