Select Committee on Health Minutes of Evidence

Examination of Witnesses (Questions 880 - 899)



  880. Thank you. Briefly to Mr Hassell and Mr Auld. In your submissions you both make reference to the trials in East Surry, the local initiatives there, and you mention the question of best value cost benefit. There is some confusion, is there not, between the price of procedures to an individual who is presenting as a private patient to the bulk purchase price the NHS may be able to effect and the cost that the insurance company might pick up on behalf of one of their clients covered by this. What are the comparisons for any given procedure between those three categories of cost?
  (Mr Auld) Perhaps I could attempt to answer the question. A key point to make is, as in anything else, if you are buying a product rather than a service you would expect the unit price of that product would come down if you buy half a dozen of them or if you buy 300 of them. You would not expect to just pay 300 times the single price if you only bought one. The quite proper concept of discounting against volume, repeat procedures in this case, is very much alive and well. I am sure that would not surprise the Committee. At the top of the list, and I think it probably unproductive to get into absolute prices, for reasons I could come on to, in terms of the relativities of price, therefore, a patient coming in on his or her own initiative and paying for a procedure you would expect would typically be the most expensive price you would pay for that procedure unless, of course, there are particular reasons in a hospital for wanting to attract more of that nature of patient.

  881. If there is a special offer on?
  (Mr Auld) There may be good reasons for that. For example, a mobile scanner may have come to the hospital for a complete day and the hospital has not got bookings for the whole day. It has got to pay for the scanner for the day but could actually put another three or four patients through it, it is that sort of thing. Typically a self-pay patient would be paying, relatively speaking, the most for a given procedure. The NHS price, if it was for a single procedure, is clearly going to be a lot more than if, as has been the case with Ms Bryson and her colleagues, they approach the sector and say "this is what we want to do, now we are going to negotiate very fiercely on bringing the price down because we are going to offer you X number of cataracts". The price that would be available, I imagine, for that sort of approach, which the independent sector has been urging on health authorities and other Commissioners up and down the country for years, is a price that is of the same order as the best price that insurance companies would receive because the concept of volume is there. We can plan across a period of days, weeks and months when we can call off the patients, working with the Commissioner, so our costs associated with treating these patients will come down. It does make sense, as this excellent study shows, if a Commissioner sits down with private sector operators and says "Here is my year, my six months, here are 1,000 patients I want treated", or in the case of Mr Milburn he is saying "There are 275,000-odd patients who now need treating because they are sitting for more than six months on the waiting list, how are we going to do it?", he is just kicking off that process now.

  882. So the NHS patients under the bulk purchasing arrangements get as good a deal as any major insurance company could get for them?
  (Mr Auld) Yes. If I could just say something about the price because I would suggest price over the next weeks and months is going to become one of the focuses of discussion. One of the things we do find difficult is to try to make sense of pricing, so-called, in the National Health Service. There is a suggestion that we should be pricing with reference to what are called the Reference Costs of the National Health Service, and that is a table of costs, a range of costs, by procedure. If I tell you the scale of our problem. If you take hip replacements, at one end of the range of costs there are some hospitals in the NHS who say they are charging of the order of £10,000 for a hip replacement and, believe it or not, at the other end of that range are hospitals who say that they are charging £800 for a hip replacement. Chairman, you cannot buy the prosthesis and the cement for that, far less the theatre time, the cost of employing the doctors, the nurses and all the others. What we are suggesting is that pricing ought to be with reference to the internal market pricing that there is already existing in the National Health Service.

  Chairman: Do any of my colleagues have any further questions on the Concordat? I want to move on to look at the issue of sending patients overseas.

Dr Naysmith

  883. I have just a very quick question. We have not been talking about this but General Healthcare has argued that its expertise lies in the provision of small elective surgical units. We have been looking at PFI in previous sessions, can I ask Mr Hassell if any of his members would be interested in providing clinical services under PFI schemes?
  (Mr Hassell) We are already providing clinical services as part of the Concordat.

  884. Particularly under Private Finance Initiative deals?
  (Mr Hassell) I think that, again, is for them individually to answer. I think their experience in recent years has not been particularly rewarding. We are concentrating much more on Public-Private Partnerships rather than PFI. As was illustrated in an earlier session, I think even some of the building companies have found the risk there is too great for them to actually survive through. As far as the majority of the Independent Healthcare Association members are concerned, Concordat arrangements, Public-Private Partnerships, are our main priority rather than PFI deals.
  (Mr Auld) PFI is too slow, too cumbersome, too expensive to operate, and we as a company do not like PFI for that reason. We tried it and it is too slow.

  Dr Taylor: May I apologise for being late.

  Chairman: Let me explain to our witnesses that there is a Health Committee Bill going on, as you are probably aware, and three of our Members are involved in that as well. It is no disrespect that they have not been here.

  Dr Taylor: I would much prefer to have been here.

  Chairman: You have missed some very interesting exchanges.

  John Austin: You can read the minutes.

  Dr Taylor: Two quick questions, forgive me if they have been asked, please just tell me. Looking at the memorandum from the Medway Trust, they give us a figure of—

  Chairman: The Medway Trust are not here unfortunately, the witness is currently in hospital, so they probably cannot answer that question.

Dr Taylor

  885. I think we should write that to them because it is quite important. If I could just go on to the sorts of elective operations that are done in the private sector. What I would like to ask is what sort of arrangements are in place when you get on to the moderate to major sort of operations? I would put hip and knee replacement operations in that sort of category. What sort of safety arrangements are in place if things go wrong?
  (Mr Hassell) I am certainly happy to make some general comments, it may be others would wish to add some specific comments. Clearly there is a risk assessment of any patient entering into the hospital and predominantly the consultant always says, and indeed all the professional bodies say, the responsibility is that of the consultant to make sure there are adequate facilities in place. Equally, of course, the sector hospital will want to make sure that they will only undertake procedures which they are geared up for in terms of equipment, experience and professional support before they undertake that work. The important thing is the risk assessment at the beginning.

  886. I ask this specifically because of the news yesterday that the new fast track Diagnostic and Treatment Centre in Surrey is going to do hip and knee replacements as a part of the fast track Diagnostic and Treatment Centre. Apart from risk assessment, if the risk assessment has said the patient can be operated on, if there is an unexpected cardiac arrest in the middle of a hip replacement, what back-up facilities would a private hospital or a Diagnostic and Treatment Centre have?
  (Mr Fieldhouse) I think the answer effectively is that the Care Standards Act provisions, which come into effect next April but are being put into place at this time, provide through the legislation a legislative framework for all the requirements to deliver appropriate quality of care for all national service frameworks and recognised Royal College of Surgeons and Physicians' frameworks for quality of care as well. Effectively the Care Standards Act provides on my reading of it, and I was on the external consultation committee that drafted the regulations, that which should provide for equal standards of care between the NHS and the independent sector in these sorts of situations.

  Dr Taylor: I find that extremely helpful because in my own neck of the woods in a Diagnostic and Treatment Centre that is being established we are told that we cannot do exactly these operations that are being done in the private sector. That is very helpful.

  Chairman: Can we move on. We have got Mr Huntley here and we want to look at the issue of sending patients overseas.

Sandra Gidley

  887. This is primarily to Mr Huntley, but feel free to chip in afterwards. In a press release you mentioned that all the pilot schemes have received "numerous requests" from patients seeking treatment abroad. I would like you to define "numerous" because it means different things to different people. What percentage of those requests have resulted in a patient going abroad to have an operation? What work is in hand to establish what factors are persuading them to take that step or deciding whether to wait in the UK for their turn to come?
  (Mr Huntley) If I could take the second point first. We have not actually sent anyone overseas yet and that is a deliberate decision not to send anyone overseas yet. I would like to go back to Mr Fieldhouse's earlier comment about ensuring quality and ensuring treatment plans. We made a positive decision that we would not go to any hospital overseas or agree to send patients to any hospital overseas until we were 100 per cent assured of the quality of treatment that can be produced within those hospitals and they abide by what are seen as the maximum standards required within the NHS. In terms of numbers that have contacted us direct, in terms of the three pilots I cannot give you a definitive number but in terms of East Kent, where my office is based, we have had 40 patients write directly to us asking to be treated overseas. That is without having the first one gone and with only the small amount of publicity, although it does not feel like it, that has gone on in terms of overseas treatment. In terms of factors, there are a multitude of factors which encourage patients either to go or not to go. In terms of wanting to go, the first is the time on the waiting list, the second is the amount of pain they are in if we are talking about hips and knees, thirdly if we talk about cataracts their quality of life is impaired because they are unable to continue with their quality of life, and the other one is about being able to have a guarantee within a certain time frame that they will be operated upon and can plan their life around it. They are the reasons they wish to go. There are as many, if not more, reasons they do not wish to go. They include leaving their family, never having travelled abroad to a strange environment, not understanding that environment and, particularly as a lot of people on the waiting lists are elderly, leaving what will be their relatives and perhaps carers.

  888. I am just curious. You said you have not sent any abroad yet, you have to make sure they are of the right standards, etc., and you are dangerously close to sounding xenophobic, I have to say. You have had four months to decide the criteria and investigate this. Why is it taking so long? Surely it is a question of setting the standards, seeing that they can be achieved and getting on with it.
  (Mr Huntley) With respect, we have only been at this for about seven weeks.

  889. The Government announced it—
  (Mr Huntley) The Government announced it on 24 August, that was when the Secretary of State made his statement. It was not until early October that we, as an organisation, were given the go-ahead to start to look. As I am sure you will be aware, trying to find sites and visit sites and discover issues around capacity and to start to negotiate a contract, which is something the NHS in terms of overseas delivery has never done in the past, does take some time. Also, I am sure Members will be aware there are legal issues, that we had to ensure we were open and fair and seen to be.

  890. What impact do you think the service will have on the local health economy? Will there be any take-up from outside the South East? I can see an attraction for people in my area where they are having to wait four years from referral from the doctor to actually having a hip operation and they could just hop over the Channel—or not, if they are waiting for a hip operation. I cannot see quite such an attraction for somebody from the North West or North East.
  (Mr Huntley) We have been contacted by a considerable number of health authorities, many of them from the North, who say that they have concerns about being able to meet their waiting list targets because their local providers cannot fulfil the capacity and as a flight to Hamburg, for example, is less than two hours from the North East why can they not send their patients there, because it is as quick as, if not quicker than, moving outside of their particular area. In terms of take-up, that is a totally separate issue. We have done some market research in terms of asking patients would they be prepared to move out of their area, and if I go back to the experience we had with fundholding many years ago, and the pros and cons of fundholding are not open for discussion in terms of this, but in terms of patients wishing to move outside their area, only one in six wanted to move outside their area. In terms of the market research we have done for overseas, that figure is going up to one in ten. To answer your first question about will this have a large impact on the NHS, the answer is it will have an impact on the NHS but in terms of large numbers, until people are happy that the quality of treatment, the speed of treatment and the ease of being moved has been sorted, I do not think patients will want to go in huge numbers, but the option is there for patient choice.

  891. So is this a gimmick really?
  (Mr Huntley) No, I do not believe it is a gimmick. I believe it is first of all the patients come first and it is patient choice first. If patients want to move then we should have the opportunity to move them in a timely manner. There is a lot for the NHS to learn from overseas and there is a lot for overseas to learn from the NHS. Certainly in some of the high quality places we have visited, their terms for their informed consent, for example, are far more detailed overseas than in this country and it is something that we should learn from.


  892. Mr Fieldhouse?
  (Mr Fieldhouse) Could I respond on the same subject. It has been suggested that in some ways consultants were contributing to the delay in this process getting off the ground, particularly in relation to quality. Mr Huntley has referred to the concept of obtaining assurances and guarantees from these sites that the quality of care is up to NHS standards as a minimum. What I would bring to your notice is that the independent sector in the UK is now subject to a legislative framework under the Care Standards Act with an entire inspectorate that goes into ensuring standards that are legislative UK requirements, and that is a very different kettle of fish from an assurance that is obtained.
  (Mr Huntley) If I may come back on that. What we are talking about is going to different countries to look at what their health services assure us in terms of ranking. For example, in France they have published a list of the top 50 hospitals and one in France I visited yesterday was the sixth best hospital for delivery of health care within France. If European countries can grade their hospitals to that degree based on quality and outcome then that is the sort of area that I think we ought to be looking at.
  (Mr Hassell) Could I just follow up on that point? I agree entirely with what Mr Fieldhouse said in that the independent sector is, of course, already heavily regulated and there will be stronger regulation from 1st April next year. To bring that into context, I would like to refer to the Medical Director's Bulletin of October of this year where there is a quote which says "... Mr Milburn has stressed that authorities will be expected to apply the same principles to European providers as to private providers in this country...", not the NHS, "...including patients' safety, quality, aftercare arrangements and complaints". I would like to think that whatever consultation is being published today it will not be the maximum standards in the NHS but the maximum standards in the independent sector which will be applied to European placements.

Dr Naysmith

  893. In evidence to this Committee which you will not be aware of yet—although it went on the internet—Alan Milburn indicated that it was likely that the Commission for Health Improvement could be involved in the vetting practice of overseas placements.
  (Mr Hassell) Yes.

  894. How do you think that might work in practice?
  (Mr Hassell) Some Members of this Committee will be well aware of the debate we had several years ago over the need for regulation in the independent sector. I think a number of us, and correct me if I am wrong, including this Committee felt that there should be one single regulatory system in this country with a preference for CHI being that body. That was not accepted by the Government and it was stated that CHI would only apply to the independent sector and that the National Commission for Care Standards was created to regulate and inspect the independent sector. Actually I think that CHI looking at services in Europe would be inadequate because, as has clearly been said in the quote I gave a moment ago, they are predominately private providers in Europe so it is the standards which apply to private providers in this country which should be the test for them.

John Austin

  895. It raises a whole range of issues about patient representation as well and the rights of successor bodies. Commenting on what Sandra Gidley was saying, we recognise that as a result of the court decision it would be unlawful to deny a person access to services just because they are elsewhere in Europe. Really at the end of the day is this going to make very much impact or is it a minor issue in terms of numbers which will be dealt with in this country?
  (Mr Huntley) I think that is difficult to answer at the moment in terms of we have identified sufficient capacity within the near continent to be able to deliver what is required of us by next April.

  896. What sort of numbers are we talking about?
  (Mr Huntley) In terms of the near continent we could deliver for the three pilot sites several hundred patients moved in a couple of months. We have done that fairly easily. In terms of—and I have not read it in detail yet—the consultation document released by Mr Milburn today, where he talks of requiring to move several thousand or tens of thousands, the issue is, as I am sure Members are aware, the capacity within Europe is considerably higher because of the 20 years of over-investment and they are looking to downsize in Europe because they have too much capacity.

  Chairman: You have not met Mr Wanless in your travels around Europe.

John Austin

  897. Are you suggesting that we spend up to their proportion of GDP?
  (Mr Huntley) No, I am not. That decision, of course, is for ministers and the Government not me. They have got converse problems. They have got as many problems in Europe as we have got for different reasons.


  898. Absolutely.
  (Mr Huntley) There are issues around ensuring that if we have to move patients overseas I do not believe we will be able to move more than 10-20,000 maximum, certainly from what we have seen now. If we start looking further afield, apart from the near continent, then perhaps issues will be different but it takes a lot of work.

John Austin

  899. Leaving aside the difficult issues that Doug Naysmith raised about indemnity and negligence and when things go wrong, what estimates have you made of the cost of sending NHS patients abroad relative to (a) treatment in NHS hospitals or (b) the independent sector?
  (Mr Huntley) I would like to just put a point before that. One of the points that we were asked to consider when looking at overseas treatment was to ensure that no additional workload was put upon the NHS. Therefore it is slightly difficult for us to do —

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