News
NHS reforms likely to cost up to £3bn with no guarantee of improved
performance
21 July 2010
The radical reorganisation of the NHS in England is likely to
cost between £2bn and £3bn to implement with no guarantee that it will
improve performance or lead to better care for patients, warns an expert
in an editorial published on bmj.com.
Kieran Walshe, Professor of Health Policy and Management at
Manchester Business School says that there is very little evidence that
past NHS reorganisations have produced much, or any, improvement, and
argues that the new government “looks likely to make all these mistakes
again.”
Few NHS reorganisations have been properly evaluated, writes Walshe,
but a recent National Audit Office study of over 90 government
reorganisations found that, despite huge costs, the benefits were
unclear, the process was often poorly managed, and that its impact on
performance was often adverse.
The reorganisation, laid out in a White Paper on 12 July, includes
plans to abolish strategic health authorities and primary care trusts;
to create about 500 new general practitioner consortiums to handle
healthcare commissioning; to hand over public health responsibilities to
local authorities; to strip the Department of Health of many of its
functions and to create an independent NHS board to take them on; to
force all NHS providers to become NHS foundation trusts; and to
restructure arrangements for healthcare regulation.
Walshe argues that Andrew Lansley “seems to have learned little from
the past history of NHS reorganisation” and recommends three things that
the new government should learn.
Firstly, structural reorganisations don’t work, he says. There is
little evidence to suggest that any of the different commissioning
structures put in place over the last twenty years were particularly
better or worse than others, he writes, or that the proposed changes
will work any better than the current arrangements.
Indeed, some would argue that the perceived failures of healthcare
commissioning result not from any particular structure but from these
repeated reorganisations and the discontinuity and disruption they
produce, he adds.
Secondly, the transitional costs of large scale NHS reorganisations
are huge, and the intended or projected savings from abolishing or
downsizing organizations are rarely realised. Walshe estimates that the
proposed NHS reorganisation will cost between £2bn and £3bn to
implement, at a time of unprecedented financial austerity, and questions
whether these changes will produce higher or lower management costs.
Thirdly and most importantly, reorganisation adversely affects
service performance, he warns. It is a huge distraction from the real
mission of the NHS — delivering healthcare and improving healthcare
quality — and can absorb a massive amount of managerial and clinical
time and effort. It can also destabilise organizations or services and
result in poor performance or failure.
The government needs to produce empirical evidence, not ideological
platitudes, to justify the case for change, concludes Walshe. “The
intended costs and benefits must be made explicit and measurable … and a
systematic analysis of the impact of the reorganisation should be
produced within two years of its implementation and presented to
parliament.”
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