Liberating the NHS Revisited

The first wave of formal public consultation following last July’s publication of the White Paper “Equity and Excellence: Liberating the NHS” ended over a week ago. Now should be a good time to take stock and reconsider our first impressions. No detailed set of policies covering a field as large and diverse as the NHS will ever be perfect. The Government’s proposals hold out great promise but to fulfil their potential pitfalls must be avoided and improvements considered.

The White Paper represents a bold and imaginative shake-up of the NHS. I welcome the major changes in policy and NHS structure. They make good sense intellectually, economically and practically. However, a great deal of work remains to be done on the detail if a smooth transition is to be achieved and the proposed policies are to be implemented successfully. Major change requires good leadership, a strong commitment from the bottom upwards and wise but decisive day-to-day decision-taking.

My principal reason for supporting the White Paper is that it goes much further than ever before towards aligning the interests of patients, medical professionals and the Government with its overall responsibility for public spending. This point is not academic. An organisation cannot act cohesively if it is being pulled apart by conflicting forces. The NHS will benefit strongly from more power residing with the people most affected particularly patients.

The second reason for my support is the adoption of management principles with which I agree: reduced bureaucracy; less layers of management; decisions taken at the lowest appropriate level; clear and measurable goals of direct relevance to the purpose of the organisation; and independence from political meddling in operational matters.

The greatest challenges are to achieve the whole-hearted cooperation of doctors and to avoid taking too much time away from the frontline care of patients. We do not want doctors to succumb to the paperwork overload that has been suffocating the police force. Every effort must be made to ensure that enough doctors are able, willing and keen to take on the new proposed responsibilities.

The White Paper pays very little attention to ways in which the NHS could raise extra revenue by providing additional services, often not relating directly to medical care (e.g. offering office or laboratory space in hospitals to small biotechnology companies and sharing certain facilities). The range of possibilities is very extensive.

One policy fraught with potential pitfalls is the proposed move to the value-based pricing of pharmaceuticals. A system that tried to relate the price of every drug purely to its value would have some non-sensical consequences. To illustrate the point, suppose that a drug company discovered a low side-effect cure for all solid-tumour cancers by chance. Admittedly such a discovery is very unlikely. However, if it did happen, the drug would save nearly all the NHS’s direct costs in treating cancer, which amount to around £5bn per annum. The cost saving to the community would, of course, be much larger. Could you really imagine that the Government would pay the true value of the drug to the lucky discoverer? Of course not, but this far-fetched example makes the intellectual point that value is not everything.  The “winner takes all” strategy of rewarding companies purely for successful products penalises pharmaceutical companies going through a barren period in R & D, just when they need help. The discovery of future major breakthroughs could therefore be compromised. The environment for research could be harmed, undoing past work aimed at preserving the attractions of carrying out R & D in the UK. Value-based drug pricing raises other practical questions. For example, the internationally accepted patent system makes it difficult for a value-based pricing policy to value drugs appropriately both before and after patent expiry. When patents expire drug prices often fall sharply but there is no corresponding decline in the objective value of the products. The UK already has amongst the lowest drugs bill per capita in Western Europe. Changes in the system must not overlook the issue of sustaining R & D, which is quite different from rewarding recently launched R & D successes.

I authored three submissions to the Department of Health during the recently ended consultation period. These discuss my thoughts in much more detail than this blog. Links to download them can be found at www.researchideas.co.uk , which is my personal website.

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About Barbara Arzymanow

Barbara Arzymanow is a Research Fellow at 2020health and is a founding director of an independent healthcare consultancy firm. She has been an investment analyst specialising in Pharmaceuticals for 25 years, prior to which she carried out academic medical research in university laboratories. Her experience, obtained entirely from outside the pharmaceutical industry, gives her a unique, political perspective independent of commercial lobbies. She has extensive experience in financing the biotechnology industry, which is vital for the long-term standing of medical research in the UK. She has always been inspired by the scientific excellence within the UK and would like to see collaborations between industry, the NHS and academia strengthened. For more information about Barbara's research and writings including submissions to Government Departments please visit http://www.researchideas.co.uk . Barbara also tweets as @barbararesearch .
This entry was posted in Department of Health, Drugs, GPs, Hospitals, Pharma, Policy, Research, White Paper. Bookmark the permalink.

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