Ignorance can be bliss; yes, even for some Labour activists on the matter of history of the party. Yet this reality never fails to amaze – and depress – me. On my way into Conference last year, I was handed a leaflet calling for a return to the 1948 NHS settlement by stopping all private sector involvement in health provision. When I pointed out that Aneurin Bevan only nationalised the hospitals and left all other healthcare including the entirety of primary care (GP services, pharmacy, optometry and dentistry) in the hands of private providers, it was met with a stubborn refusal to believe such heresy. And the continuing calls from groups such as Keep Our NHS Public and EveryDoctor to end all NHS/private sector contracts are difficult to square with the fact that patient care outside hospital is entirely dependent on their existence.
So often, people think and talk about the NHS as if it means the hospital estate: a collection of state owned and run buildings staffed by state employees. It is a misleading image. In truth, the NHS is a system rather than a physical entity: an idea, a brand, a complex and confusing method of translating public funding into free healthcare. In hospitals, by and large, we understand that we are experiencing care delivered direct by the state but, even then, the complex flow of commercial activity underpinning hospital finances and guaranteeing the flow of equipment, drugs and support services is lost on us. Moreover, even hospital treatment is increasingly dependent on direct care from private contractors. Take eye care waiting lists, for example; already the second longest in the entire system, the wait would be immeasurably worse were it not for the volume of cataract operations undertaken by private providers.
Outside secondary care, things get even more murky. In dentistry, we may know the difference between NHS and private healthcare – if only because of the difficulties in accessing NHS treatment – and pharmacists and optometrists work in settings which clearly double as retail environments. However, I’d argue that vanishingly few of us understand that our GP will almost certainly be employed by a private entity. Although these are most commonly the traditional model of GP-owned partnerships, the introduction in 2004 of the Alternative Provider Medical Services (APMS) model has given access to GP provision to large US companies such as Centene (via a subsidiary, Operose Health).
In this context, Wes Streeting’s stout defence of the private sector’s involvement in the NHS, coupled with a commitment to patients being able to choose who provides their care, is both utterly in tune with traditional Labour values and entirely pragmatic. The woeful record of the NHS over recent years – an average increase on funding of around 3% every year matched with a record number of operations cancelled – has shaken Ministers’ confidence in the existing structures to deliver. Add to that the insistence of many of the traditional pillars of the NHS to pursuing their own interests – doctors’ repeated demands for pay increases are but one example – and it is not hard to understand why the Health Secretary took the decision to bring a sudden end to the operational independence of NHS England.
But the Government has promised not merely to improve the NHS but to transform a service they describe as “broken.” And if it is to deliver on the programme set out in the 10 Year Health Plan, it will need not just to overcome the culture of inertia in the NHS but engage the active support of the private sector. The three shifts which are central to the Plan – from treatment to prevention, hospital to community, and analogue to digital – all critically depend on moving from a simple hospital-centric, command and control model to a more sophisticated, mixed market style of delivery.
Take the second of those shifts: that from hospital to the community, taking pressure off overcrowded hospitals and allowing patients to be treated closer to home. Such a move is long overdue: the hospital sector has been hoovering up an increasingly large slice of healthcare spending for some years: the proportion of spend going to primary and community healthcare has declined from 8.9% to 8.1% between 2015 and 2022, with the number of hospital consultants increasing by 18% compared with a 4% increase in GPs. The lack of primary care investment is “one of the most significant policy failures of the past 30 years”, one of the country’s most influential health thinktanks concluded last year. The Keep Our NHS Public campaign has inveighed against the proposed Integrated Care Systems on the basis that they may provide private providers a platform to increase their flow of funding. In truth, the past two decades have shown that the current arrangements see less and less money going to external providers, and primary and community healthcare being increasingly deprived of funding.
If Ministers want an expanded role for primary and community providers, they cannot merely will that into existence. Two things have to happen. First, they have to find the money to pay for the new activity. In theory, that should be a simple matter. Care provided in the community can cost far less than work done in hospitals, while delivering that all important ‘convenience’ to the public. Modelling undertaken by PA Consulting last year showed that moving just four types of eye care activity from hospital to high street optometry would save nearly £100m a year and release two million GP and hospital appointments. In practice, what we see too often is a system that favours competition for funding over collaboration, incentivising hospitals to fight tooth and nail to retain the money they get, whether or not that care could and would be better delivered on the high street. I know that some hospitals are responding to the proposed shift towards neighbourhood health by trying to reposition themselves as community providers, following the same old rule: at all costs hang on to the money.
Second, Ministers will have to convince private healthcare providers – including the GPs, pharmacists, optometrists and dentists – to scale up to take on the new promised work. Sadly, the history of NHS contracting with the private sector is not a happy one and many providers have grown sceptical about undertaking NHS work. NHS dentistry is in crisis not merely because of underfunding but also because of the refusal of dentists to participate. The Pharmacy First initiative, trumpeted by the Conservatives and embraced by Labour, is working, but faces criticism about funding levels and effectiveness hampered by the refusal of some GPs to direct patients to use the scheme. In optometry, while there is an eagerness to provide more clinical services, there are fears about both the likely funding levels – providers are paid £25 for an NHS sight test which costs them something like £50 to provide – and how to persuade secondary care ophthalmology to play ball. For a GP community already at war with the NHS about the terms of their existing contract, the suggestion that they may be expected to share responsibility for the new community health centres on equal terms with their non-doctor healthcare peers sounds optimistic at best.
The NHS cannot expect providers to sign up to contracts which do not pay, or are loaded with burdensome compliance and reporting requirements, or are so short-term that they will never pay back the set-up costs. Nevertheless, the opportunity to use the private sector to fulfil Ministers’ vision of moving healthcare provision beyond the hospital wards is very real. Unlike the NHS, the sector is relatively quick to respond, unhampered by issues of staffing shortages, high wage demands and resistance to change. Moreover, rather than investing billions to create a new network of community healthcare centres – or, worse, to fund some hospitals’ ambitions to grow their own network of hubs – Government can simply make use of the pre-existing high street infrastructure provided by pharmacy, dentistry and opticians to offer the public easy access to healthcare in the communities in which they live. Get the contracting and reporting arrangements right – and the Government’s vision of seamless digital connectivity is essential here – and it is possible to show real impact on the patient experience before the date of the next election.
There of course are areas where it is right to express some concerns about the risks of increased private sector involvement in the NHS. While primary care has always been delivered by private businesses, the involvement of private hospitals in secondary care is a more recent phenomenon and its implications are perhaps more complex. Government must also be aware of the dangers of becoming over-reliant on private markets which may be prone to sudden upheaval or anticompetitive practices; the entry of those large providers into the GP arena for example raises real questions, and there are currently good reasons to be concerned about the stability of the pharmacy sector. In some areas too, we should worry about deepening the staffing shortages in the NHS by greater competition from the private sector.
Above all, we need to be sure that the move will improve the service to the public. Too often, the private/public debate is framed in ideological terms, and the result is patients lose out. Asking patients to travel miles from home to receive directly managed NHS treatment when they could access privately-provided NHS care in their local high street may be politically pure but it is hardly patient-friendly.
Of course, moves to increase the role of private providers do risk exposing patient care decisions to commercial influence. But such risks are manageable, at least if the NHS healthcare regulation is modernised to deal with them. Moving away from the pre-1948 model of regulation which focuses primarily on the individual practitioner rather than the hospital, practice or business that employees them – a move which is more than half a century overdue – is an essential first step.
But with the need to achieve rapid change with little additional resource, Ministers have only one realistic choice: to maximise what private providers have to offer. Yes – Streeting can expect the ideologues to accuse him of betrayal of the party’s principles. But he has a cast-iron, and true, defence: he is simply following the path set by Aneurin Bevan.
