Bernard Dowling - GPs and Purchasing in the NHS: The Internal Market and Beyond

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GPs and Purchasing in the NHS

First published 2000 by Ashgate Publishing

Reissued 2018 by Routledge

2 Park Square, Milton Park, Abingdon, Oxon OX14 4RN

711 Third Avenue, New York, NY 10017, USA

Routledge is an imprint of the Taylor & Francis Group, an informa business

Copyright Bernard Dowling 2000

All rights reserved. No part of this book may be reprinted or reproduced or utilised in any form or by any electronic, mechanical, or other means, now known or hereafter invented, including photocopying and recording, or in any information storage or retrieval system, without permission in writing from the publishers.

Notice:

Product or corporate names may be trademarks or registered trademarks, and are used only for identification and explanation without intent to infringe.

Publishers Note

The publisher has gone to great lengths to ensure the quality of this reprint but points out that some imperfections in the original copies may be apparent.

Disclaimer

The publisher has made every effort to trace copyright holders and welcomes correspondence from those they have been unable to contact.

A Library of Congress record exists under LC control number: 99075447

ISBN 13: 978-1-138-63436-7 (hbk)

ISBN 13: 978-1-315-20544-1 (ebk)

Contents

Guide

The introduction in 1991 of a quasi-market into Britains health service was commonly perceived as the most radical change to the service since it began. The reform established a system in which the purchasing function was performed by health authorities and those general practices that joined the fund-holding scheme. Yet while this change clearly altered the organisational structure of the service (the purchaser-provider split), its impact on the services received by patients was less clear. A reason for undertaking this research was to resolve this problem in the context of one service, elective surgery (though the project compared the performance of the purchasers within the quasi-market, not that system with its forerunner).

Whilst the literature (prior to this study) lacked any direct comparison of the performance of health authorities and general practice fund-holders as purchasers, there was much controversy about the equity implications of the system. Most notably this focused upon alleged differences in the waiting times for hospital services of patients registered with fund-holding and non fund-holding practices. However, such allegations were based on anecdotal evidence and open to contradiction.

The research on which this book is based moved that debate beyond a reliance on anecdotal evidence and for one service, elective surgery, redresses the lack of evaluation in the relative merits of fund-holders and health authorities as purchasers. The performance of health authorities and general practice fund-holders were tested by comparing the waiting times of patients who had their elective surgery commissioned by each purchaser type. To do this, the waits of fund-holding and non fund-holding patients for operations covered by the fund-holding scheme were compared at four public providers over a four-year period.

Another important aim was to ascertain why any tendency towards waiting time differences occurred. A series of hypotheses were tested, including the generosity of fund-holders budgets, contrasts in the surgical case mix of each population, plus variations in the way fund-holders and health authorities performed their purchasing roles. In discussing the policy implications of the study, the book then addresses how public sector quasi-markets can work in the contexts of both equity and efficiency.

This book firmly has its origins in my doctoral research at the London School of Economics. Looking back, my studies actually progressed more rapidly than I was initially expecting and for that I must pass much credit to Howard Glennerster and Julian Le Grand. I was extremely fortunate to be able to call on their guidance and expertise throughout the project and my sincere thanks go to them both for their advice, support and encouragement. I am also indebted to Calum Paton for his invaluable help towards transforming a doctoral thesis into this book.

Beyond such academic support the research was, and could only have been, completed with the crucial help of a large number of people. I must thank as a group all the general practitioners, hospital consultants, plus the trust, health authority, and practice managers who spared their time to be interviewed or partake in less formal discussions for the research. Much gratitude also goes to the practice staff who facilitated the checking of medical records against the details for some of the patients included on the computerised database that was a central element of the study. Thanks are also due to numerous managers from the West Sussex Health Authority for their assistance in providing me with the data required for the successful completion of the project.

Appreciation is also due to my employers during the whole of the research period, the Victoria Road Surgery in Worthing. My need to regularly take impromptu leave in order to undertake research was always accepted without question. The Economic and Social Research Council funded the research project (grant number: R00429534090), and I take this opportunity to thank them for that financial assistance. I also acknowledge the British Medical Journal for granting me permission to use the material from a couple of articles I had published through them as a central feature in this book. Details of these can be found in the bibliography.

Last but not least, mention must be made of my partner, Chris. In order to free my time for studying she took on a far greater proportion of domestic responsibilities during the project, including the care of our children, than could reasonably have been expected. I shall always be grateful for her help.

1
The 1991 Reforms: Questions, Background and Rationale

The reforms to the National Health Service (NHS), introduced by the government of the United Kingdom (UK) in April 1991, were widely judged as inaugurating the most radical changes to the service since its inception in 1948. Even so, they were still representative of an international trend during the last decade or more when health care reform was commonplace (Wagstaff et al., 1993). For whilst the Thatcher regime was perhaps one of the most noted advocates of market mechanisms in welfare provision, their reforms to the NHS reflected a pattern of change that can be seen to various degrees almost everywhere in Europe (Baldock, 1993; Brommels, 1995; Saltman and von Otter, 1995). Indeed, there is room for states to learn from each others experiences (Ham, 1996a; 1997a), even though the precise pattern of the changes in different countries have been specific to each individual nation (Kane, 1995).

The central characteristic of the UK reforms was a division of the organisational structure of the service, or at least the part relating to the procurement and provision of secondary care for patients, into separate purchaser and provider functions to create a more competitive climate. In brief, the treatments received by patients from service providers were to be purchased on their behalf by health authorities and those family doctor general practices which elected, and were eligible, to participate in the fund-holding scheme. An important reason, alongside concerns about cost containment and the tradition of centralisation in the NHS, why patients had the purchasing function performed for them derives from the economics of health care that stresses poor consumer knowledge. They are not generally considered to be knowledgeable enough to make appropriate clinical decisions themselves (see Strong and Robinson, 1990).

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