As I write this it seems like the default attack on those who oppose the NHS bill is that we are trying to undermine the coalition government, and that we are, as a consequence, lefties.
Well, it’s good to see that government continue not to allow evidence to get in the way of their arguments.
Other can make their own arguments. I spent most of the 2000s arguing that Labour’s approach to the NHS was wrong – I was pleased additional funding had at last appeared, but depressed that they thought that, as the decade wore on, trying to create some kind of marketplace was the answer. I wrote at least an article a year on this and so hope to be able to show at least some kind of track record here.
Now I’m criticising the coalition government for making the same mistake. I think both Labour and the coalition are wrong – this direction for health reorganisation is a mistake.
Ah (the coalition, or perhaps Alan Milburn might say) – the reason you don’t like either Labour or coalition health policy is that you are a proper lefty – you don’t believe in markets, and you want the government to control everything.
The reason why I don’t believe markets work in healthcare is that I like my markets to be competitive.
For markets to work, there has to be competition. Those working in competitive environments have to fear consumers going elsewhere, with the potential loss of income being important. Those in charge need to be able to change what’s going on in their organizations to prevent their customers going elsewhere. But in the NHS as comprehensive providers of care can’t and won’t be allowed to go bust. Equally I’m not clear exactly what health managers can do to prevent patients choosing to go elsewhere. That’s down to clinicians. Clinicians are generally in short-supply, and so suggesting they are threatened by patient choice seems odd. Without competition, markets are pointless.
Equally, offering patients choice does not mean you have made a market. Offering me a choice between two local hospitals doesn’t mean they are in a competitive relationship. There might be enough patients for them both (that’s why we have waiting lists). A few might change from the referral their doctor might have given them at the margins, but that’s hard signals the outbreak of competition. Even if there were some benchmark that allowed patients to choose the ‘best’ hospital, we couldn’t allow every patient to choose it as that would drive up waiting lists and put the other one out of business. And we can’t allow comprehensive providers of care to go bust – we don’t have the capacity to survive without them. Patient choice is not the same as competition.
The reason why market don’t work in healthcare is that there isn’t enough competition, patients lack the information to be able to choose, patients may not actually want to make choices (surveys tell us they would prefer their local healthcare organizations simply to be good), and there is little incentive for comprehensive hospital providers to improve through competitive forces as they can’t be allowed to go bust.
Where we introduce market mechanisms where they cannot work, all we get is abuse. We give healthcare managers big pay rises to pretend they are running competitive business enterprises when they are not, but ask them largely to do the same job as before. We end up bailing out hospitals when they run out of money (as, for example, with the £1.5bn PFI bailout). We give private providers access to public money to the point where they depend upon it for 25% of their revenues but still pretend to be dynamic, independent companies. What nonsense.
Above all, all this nonsense distracts us from the serious business of marking healthcare better. How much money do we have to waste on the purchaser-provider split before we consider whether any real benefits are accruing from it? How much extra healthcare could we have bought with all the money poured away on pointless reorganizations since the 1980s? Making healthcare better involves time and effort and evidence. Imagining you can reorganize for it is nonsense.
Both Labour and Conservative politicians who have spent billions on trying to force markets upon healthcare should hang their heads in shame. You don’t need to be a lefty to see that markets don’t work in healthcare. Taking a couple of basic courses in economics, sociology, politics and the history of healthcare should do the job.