04.01.11
Who pays?
Price competition in the NHS is a complex and thorny subject and recent announcements have only made things more confusing.
The Department of Health insists the widely-reported letter from NHS chief executive Sir David Nicholson last week stating that there was “no question” of introducing price competition, and that services must compete on quality, was merely a reiteration of existing policy and not a U-turn.
But in the Health and Social Care Bill, the first clause on pricing, Clause 103, reads: “If a health care service is specified in the national tariff the price payable for the provision of that service for the purposes of the NHS is a) the price specified in the national tariff for that service, or b) where the national tariff specifies a maximum price for that service, such price not exceeding that maximum as the commissioner and the provider may agree.”
The BMA suggests the word “maximum” implies it must be possible to go under that price.
In its written evidence, the BMA says: “Giving Monitor and the NHS Commissioning Board the power (Clause 103) to set a maximum national tariff (price) for the provision of some services, without appropriate safeguards, opens the way for price competition. In the current economic climate, where resources are scarce and £20 billion savings are required to be identified, there is even more potential for the focus to shift to cost rather than quality, thus damaging patient care. Price competition is also likely to increase transaction costs, as commissioners and providers spend substantial amounts of time negotiating prices. The Bill should be amended to explicitly preclude price competition.”
Is the BMA over-reacting? Health Secretary Andrew Lansley has made the same point on price competition in a number of interviews, and his department’s communication strategy has failed to stop the idea that his reforms are about introducing price competition taking hold in sections of the media and public mind.
If he and Sir David are being entirely honest about price competition, should it be explicitly precluded in the Bill?
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